KUALA LUMPUR (Jan 26): Rakuten Trade has valued ACE Market-bound KJTS Group Bhd at 30 sen based on discounted cash flow valuation, translating into a price-earnings ratio of 17 times for the financial year ending Dec 31, 2024 (FY2024), a slight discount to industry peers due to its smaller market capitalisation.
KJTS specialises in providing cooling energy, cleaning, and facility management services, primarily to the property industry.
In a note on Friday, Rakuten said that for the cooling energy segment, the company offers comprehensive services, including energy management, energy management, engineering, procurement, construction and commissioning (EPCC), and the installation, retrofitting, or upgrading of cooling systems.
The research house said KJTS is strategically positioned for Malaysia’s rapidly growing data centre (DC) sector.
It said the company is actively pursuing DC projects in key regions.
“According to [market research firm] TechNavio, the Southeast Asian DC construction market expected to grow by around RM4 billion from 2021 to 2025, indicating a favourable environment for KJTS.
“In addition, we believe KJTS as a certified Esco (energy service company) is well placed for government retrofitting initiatives, such as the National Energy Transition Roadmap to enhance energy efficiency.
“As such, we forecast a strong FY2022-FY2025 earnings compound annual growth rate of 22%, driven by the strategic ability to cross-sell a comprehensive suite of services, increased demand from data centres and industrial facilities for cooling solutions, as well as growing awareness of ESG (environmental, social and governance) principles related to energy efficiency,” Rakuten said.