A net-cash Malaysian power-EPC specialist shifting from semiconductors to hyperscale data centers—set up for a 2026–2027 billing inflection if it converts its RM850m tender book.
Overview
HE Group Berhad (0296.KL) is a Malaysian electrical engineering EPC specialist operating through Hexatech Engineering, focused on end-to-end power distribution systems: design, supply, installation, testing, and commissioning across HV/MV/LV/ELV environments. Historically, it built its reputation as a critical contractor to semiconductor and advanced manufacturing facilities in Penang and Kulim, where power stability and redundancy requirements create high barriers to entry. The company has broadened into turnkey ‘building systems and works’ (via specialist partners) and niche retrofitting/hook-up services that upgrade live facilities without disrupting operations. A major corporate milestone was its move from the ACE Market to Bursa Malaysia’s Main Market in Nov-2025, elevating credibility and expanding access to institutional capital and multinational tender pools—particularly relevant for hyperscale data-center counterparties. The core narrative is a deliberate revenue mix shift: until early-2025, semiconductors were as much as ~80% of the pipeline, but geopolitical uncertainty and delayed semiconductor CapEx pushed management to pivot hard into data centers and renewables. By 3Q25, data centers represented >80% of a ~RM850m tender book, transforming HE Group into an infrastructure proxy for Malaysia’s digital economy. Financially, 2025 is framed as a transition trough: legacy projects rolled off before new data-center billings ramped, producing a sharp revenue decline but resilient (even expanding) margins and a fortress net-cash balance sheet. The investment case centers on whether the replenished order book and tender pipeline convert into a billing ramp beginning in 1H/2H 2026.