YTL Power International (YTLP) has announced that it will be among the first companies in Southeast Asia (SEA) to deploy the NVIDIA GB200 NVL72. The company will adopt and manage one of the world’s most advanced supercomputers on NVIDIA Grace Blackwellpowered DGX Cloud – for accelerating the development of generative AI.
According to NVIDIA, the GB200 NVL72 provides up to a 30x performance increase compared to the same number of NVIDIA H100 Tensor Core GPUs for large language model (LLM) inference workloads and 4x faster training performance at scale.
This new liquid cooled GB200 NVL72 rack reduces a data centre’s carbon footprint and energy consumption, as it delivers 25X more performance at the same power while reducing water consumption, vs. its predecessor the H100 air-cooled infrastructure.
Progress update on Data Centre operations
CGS International (CGS), in its Company Flash Note said today (Mar 20), to recap, in Dec 2023, YTLP announced a collaboration with NVIDIA to build an AI data centre (DC) with an earmarked capacity of 100MW, giving the group access to the much sought after H100 AI chip, within its planned 500MW YTL Green DC Park in Johor which is expected to be ultimately powered by renewable energy via an onsite solar farm.
The balance capacity is expected to be operated on a colocation basis, based on initial plans.
YTLP expects its customer for the first 8MW (out of the 32MW firm capacity) of its colocation data centre (DC) in Kulai, Johor to move in very soon, and earnings contributions to start from 4QCY24F.
The company is currently in the process of onboarding another new customer for an additional 16MW within this colocation facility.
Rollout plans for the NVIDIA DC in Johor remain on track, with planned commissioning by end-2024, according to management.
While finer details on the DC projects are still lacking, CGS’s initial calculations suggest that these planned DC investments can contribute as much as RM1.2bn-1.4bn in net profit to YTLP once fully ramped up in FY27F.
CGS: Still an Add
CGS believes the potential value accretion of its new assets has yet to be fully priced in by the market despite YTLP’s strong share price performance of 361% over the past 12months. As such, CGS reiterated their Add rating on YTLP with an unchanged SOP-based TP of RM4.50.
Current share price implies a P/E of c.10-11x on an earnings base that reflects a normalisation of PowerSeraya earnings by FY26F.
Downside risks could come from execution failure for its DCs. Securing off-takers for the NVIDIA DC and colocation facilities at attractive rates could re-rate the stock.
