Sunway Construction Group Bhd (SunCon) has strengthened its position in Malaysia’s fast-growing data centre construction sector after securing additional change orders worth RM664.4 million for two data centre projects in Johor. The latest awards increase the total contract value of the projects to RM865.6 million.
The contracts were awarded to SunCon’s wholly owned subsidiary, Sunway Construction Sdn Bhd (SCSB), by a United States-based multinational technology company. The additional works were accepted on June 17, 2026, following the initial project service requests secured on April 21, 2026.
Construction for both projects commenced in April 2026. One data centre facility is scheduled for completion in the fourth quarter of 2027, while the second project is expected to be completed in the second quarter of 2028.
The projects form part of the ongoing expansion of data centre infrastructure in Johor, which has emerged as one of Southeast Asia’s key destinations for hyperscale data centre investments due to its strategic location, connectivity and growing digital economy ecosystem.
SunCon stated that while the projects are exposed to common construction risks such as fluctuations in material costs, these risks are expected to be managed through the company's extensive experience and expertise in delivering large-scale infrastructure and specialised construction projects.
With the latest contract additions, SunCon has secured RM4.2 billion worth of new orders year-to-date. The group's outstanding order book now stands at RM8.8 billion, providing a strong pipeline of projects and earnings visibility over the coming years.
The data centre contracts are expected to contribute positively to the group's financial performance beginning in 2026 and continuing throughout the construction period.
The growing order book also reflects increasing demand for specialised construction services, particularly within Malaysia's expanding digital infrastructure sector.
For the first quarter ended March 31, 2026, SunCon reported a net profit of RM118.41 million, representing a 56.4% increase compared to RM75.72 million recorded during the corresponding period in the previous year.
The stronger profitability was attributed to improved contributions across all business segments.
However, quarterly revenue declined by 27% to RM1.02 billion from RM1.4 billion previously. The lower revenue was mainly due to reduced construction contributions compared to the exceptionally high base recorded a year earlier, when accelerated work progress on the Rapid Transit System Link and several data centre projects boosted earnings.
Despite the revenue decline, the group's ability to generate higher profits demonstrates improved operational efficiency and stronger project margins.
The latest contract awards highlight the increasing importance of data centre developments as a major growth segment for construction companies in Malaysia.
As global technology companies continue expanding cloud computing, artificial intelligence (AI) and digital services infrastructure, demand for purpose-built data centres has accelerated significantly. Johor has become one of the primary beneficiaries of this trend, attracting substantial investments from international technology firms and hyperscale operators.
For SunCon, participation in these projects strengthens its track record in specialised construction and positions the company to capture additional opportunities arising from Malaysia's expanding digital infrastructure ecosystem.
SunCon's additional RM664.4 million contract awards demonstrate the strong momentum in Malaysia's data centre sector and reinforce the company's growing presence in this high-value construction segment. The enlarged contract value of RM865.6 million, together with an outstanding order book of RM8.8 billion, provides a solid foundation for future earnings growth.
As data centre investments continue to flow into Johor and other strategic locations, construction companies with proven expertise in delivering complex digital infrastructure projects are likely to benefit from sustained demand over the coming years.
This article highlights the growing significance of data centres as a key driver of Malaysia's construction and digital infrastructure sectors. I learned that SunCon's success is not only supported by traditional construction projects but increasingly by specialised data centre developments commissioned by global technology companies. The company's expanding order book and strong profit growth demonstrate how the rapid expansion of cloud computing, AI and digital services is creating new opportunities for construction firms. Additionally, Johor continues to strengthen its position as a major regional data centre hub, attracting significant foreign investment and supporting long-term economic growth.
Yao Mu Realty, based in Kuala Lumpur, Malaysia, specializes in industrial real estate for factories and land, delivering professional and efficient solutions.
Posted by Yao Mu Realty Sdn Bhd on 18 Jun 26
Malaysia