UUE to gain from fast-track DC requirements

By the Editorial Team · Friday, October 9, 2026

UUE Holdings Bhd is expected to achieve stronger project wins and earnings growth due to increased demand for underground power infrastructure in Malaysia and Singapore, supported by a record RM700 million tender pipeline and ongoing contracts with major players like TNB and data centres. This growing opportunity pipeline, along with strategic shifts in subcontracting and intensified project activity in the coming fiscal years, positions UUE for sustained order-book expansion and improved profit margins.

UUE Holdings Bhd is poised for stronger project wins and earnings growth amid rising demand for underground power infrastructure across Malaysia and Singapore, according to a recent analysis by Hong Leong Investment Bank (HLIB) Research. The company’s expanding tender pipeline is expected to benefit from opportunities related to data centres, Tenaga Nasional Bhd (TNB), and solar projects.

HLIB Research has increased its annual project win projections for UUE from financial year 2027 (FY27) through FY29, raising estimates to RM200 million each year—up from previous forecasts of RM160 million for FY27, and RM180 million for both FY28 and FY29. Correspondingly, earnings forecasts were lifted by 3%, 7%, and 4% over the same period.

The research house noted that UUE’s financial year-to-date wins have already reached RM120 million, representing 75% of its prior full-year target, with five months remaining in the fiscal year. This performance closely aligns with FY26’s one-off project wins of approximately RM196 million, excluding an estimated RM337 million from SP Group and TNB long-term contracts.

HLIB maintained its “buy” recommendation on UUE, increasing its target share price to RM1 from RM0.85, and raising the target price-to-earnings ratio from 20 times to 22 times on FY28 earnings per share. The adjustments reflect Malaysia’s accelerated investment in power infrastructure.

The company’s tender book has reached a record RM700 million, while the order book stands at RM515 million—equivalent to 2.4 times its FY26 revenue. Discussions with mechanical and electrical contractors, along with TNB, suggest further project opportunities will emerge throughout 2027 and 2028. Given a historical tender conversion rate of 20% to 30%, this expanding pipeline is expected to contribute to continued order-book growth.

HLIB highlighted a trend where leading mechanical and electrical contractors are increasingly concentrating on higher-value substation contracts. This shift is anticipated to channel more specialized, smaller-scale high-density polyethylene pipe laying work to UUE.

In the near term, HLIB expects UUE’s earnings to strengthen quarter-on-quarter, driven by improved output from both Malaysia and Singapore operations. The Singapore unit benefits from the deployment of 10 teams since June—up from seven teams in the first quarter of 2026.

Looking ahead, one-off project calls are likely to intensify in the second half of FY26 as TNB activates new jobs and as projects under the recently approved five-gigawatt Data Centre Task Force advance toward securing energy supply agreements. These developments are expected to generate increased job volume and larger contracts for UUE, with fast-tracked data centre requirements supporting improved profit margins, according to HLIB Research.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.