Yamato: World Data - SW (09698) sales target doubled to maintain “buy” rating target price of HK$47

The Zhitong Finance App learned that Yamato released a research report saying that GW (09698) performed well in the second quarter. Management doubled the 2026 sales target from 500 megawatts to 1 gigawatt, and the backlog of orders is expected to reach about 1.2 gigawatts by the end of 2026. Coupled with a clear delivery schedule, it provides strong visibility into the results until 2028. Yamato raised its 2026-2027 EBITDA forecast by 11% to 49% to reflect strong demand and delivery progress. The target price remains at HK$47, maintaining a “buy” rating based on the average forecast EBITDA value of the Chinese business from 2026 to 2027, and the valuation of holding about 20% of DayOne's shares.

According to the report, GDS revenue for the second quarter increased 7% year on year to 3.1 billion yuan, adjusted EBITDA increased 3% year on year to 1.4 billion yuan, and profit margin 45.5%. The year-on-year decline was mainly due to rising utility costs. Operating indicators were stronger than expected. The net delivery area reached 21,307 square meters, and the utilization rate rose to 79.2%. New orders in the first half of the year reached a record high of 471 megawatts, up from 317 megawatts in 2025, mainly from the three major customers.

According to Yamato, management expects deliveries in 2027 to triple the 2026 level, and estimates that the 2027 and 2028 deliveries will be around 700 megawatts and 950 megawatts, respectively. Since most of the new orders recently signed are greenfield projects, the delivery cycle is four seasons long. 2027 will mainly be a deployment year, and the profit contribution is expected to be reflected in 2028.