Telekom Malaysia Bhd (TM) fell 4.07% to RM7.77 as at 4.08pm on Friday, extending its retreat after opening at RM8.00 and touching an intraday high of RM8.05. The stock traded as low as RM7.73, with 5.88 million shares changing hands.
The decline came despite continued expectations for TM’s data centre business to emerge as a stronger earnings contributor. RHB Investment Bank Bhd (RHB Research) previously maintained its BUY call with a RM9.30 target price, citing the group’s expanding data centre operations, resilient wholesale business and ongoing cost optimisation.
TM’s data centre capacity in Cyberjaya and Iskandar Puteri has doubled to around 40MW following expansion completed in 2025, with utilisation already exceeding 60%. RHB expects occupancy to rise above 90% by the end of 2026.
The research house also highlighted TM Nxera, its AI-focused data centre joint venture with Singtel, with the first phase providing 64MW of capacity and targeted for commissioning in the second half of 2026. More than 60% of the capacity has reportedly been pre-sold.
Meanwhile, TM’s wholesale business continues to benefit from demand for 5G fibre backhaul, data centre co-location and connectivity services, while retail internet revenue has also been supported by higher average revenue per user.
Despite Friday’s decline, RHB previously noted that TM traded at around five times FY2026 enterprise value-to-EBITDA, below the sector’s historical average of 9.5 times, with an estimated FY2026 dividend yield of about 5%.
