DPS jumps on data centre wave

WITH Malaysia continuing to play the data centre hub game, it is not surprising that many listed companies want a slice of the action.

Take DPS Resources Bhd, for instance. The company says this week that it is exploring a tie-up with an Alibaba Group Holding Ltd-linked firm for a massive US$1.1b artificial intelligence data centre in Melaka.

DPS, which has a market capitalisation of just RM158.11mil, has also been seeking to venture into another related business that is currently in vogue: renewable energy.

Last April, it announced a partnership to develop solar farms in Melaka.

DPS was listed back in 2004 and has struggled to show any decent profits in recent years, falling into losses in some of its last few financial years.

Originally a furniture company before pivoting into property development in 2015, the group mainly builds residential and mixed-use townships, as well as commercial and industrial buildings.

In 2023, DPS acquired seven parcels of freehold land measuring 253.31 acres in Alor Gajah, Melaka, for RM45.6mil.

At the time, the company said the land would be developed into mixed properties, including affordable homes, terrace houses, bungalows, townhouses and apartments.

In its latest filing on the AI data centre venture, DPS says the collaboration marks a step towards unlocking the value of its landbank and infrastructure capabilities in Melaka, amid rising global demand for high-performance computing capacity.

However, DC operators require highly strategic pieces of land before committing to development.

Such sites must have good access to powerful data lines, reliable electricity supply, and adequate water sources.

The plan is for DPS to provide the land, power supply, and supporting infrastructure, while overseeing regulatory approvals, government liaison, and overall project management.

The China-based partner, meanwhile, will bring in global computing demand and potential customers, and handle market development, technical operations, and day-to-day management.

Investors appear to have welcomed the announcement, with DPS’ share price rising 12% this week.

Interestingly, the stock had already begun rallying even before the announcement was made.