IJM Corp Sees Share Price Boost Following Strong Data Centre Construction Gains

IJM Corporation has received a wave of positive momentum from major research houses, with RHB Research, HLIB, and CIMB Securities maintaining BUY calls on the construction and property giant following its 1QFY27 financial results.

The updated analyst consensus reflects a significant appreciation in market sentiment, driven primarily by robust earnings performance within the group’s construction division. The surge in profitability is being attributed directly to the company’s increasing involvement in large-scale data centre projects, a sector that has become a key engine for Malaysia’s infrastructure growth.

RHB Research led the sentiment shift, raising its target price for IJM Corp significantly from RM3.05 to RM3.50, representing a potential 22% upside. Meanwhile, HLIB adjusted its target price to RM3.40, and CIMB Securities pegged its target at RM3.25. These adjustments follow a 1QFY27 reporting period where construction margins benefited from high-intensity project execution, according to the original publisher.

The mechanics of this growth lie in the rapid deployment of digital infrastructure across Malaysia. As international tech firms scramble to establish a presence in the country, contractors like IJM Corp are positioned to capture a substantial share of the engineering, procurement, and construction (EPC) contracts required to house high-density AI and cloud computing servers.

For the average Malaysian investor, these upgrades highlight a clear shift in how domestic construction stocks are being valued. While the sector was once defined purely by highway and residential property cycles, the current data centre demand offers a more stable and high-margin revenue stream. For SMEs operating in the construction supply chain, this suggests that Tier 1 contractors will likely continue to look for local partners to meet the accelerated timelines required by multinational data centre clients.

This trend is also encouraging for the Malaysian labour market. With the national unemployment rate hovering at 3.0% as of May 2026, the sustained demand for skilled engineering and technical labour in high-tech construction projects supports ongoing job security. However, it also places pressure on wage growth and resource allocation, as the construction industry competes for talent with the wider tech and services sectors.

The performance of IJM Corp comes at a time when the broader Malaysian economy is demonstrating resilience, with real GDP growth recorded at 6.0% year-on-year in the most recent quarter. A robust construction sector serves as a vital multiplier for this growth, particularly as data centre investments often trigger secondary developments in electricity grid infrastructure and telecommunications connectivity.

Furthermore, these developments unfold against a backdrop of stable inflation, which stood at 1.8% in July 2026. While infrastructure projects are energy-intensive, the current fuel pricing environment—with RON95 currently pegged at RM1.99 or RM2.05 depending on the subsidy scheme, and diesel at RM4.72—adds a complex layer to project logistics costs. For investors, the long-term question remains how effectively IJM Corp can manage rising operational costs against the scale of these massive infrastructure contracts.

What remains unconfirmed is the full extent of the order book backlog and the timeline for upcoming data centre tenders. While analysts are optimistic about the current margins, the market is still awaiting further details on how the group plans to manage resource constraints as the demand for rapid infrastructure build-outs reaches a nationwide peak.