GULF – Data center to be new S-curve for long term

Key takeaway from GULF’s data center site visit. We visited the GSA01 data center, located on Thepharak Road in Samut Prakan. It is a 25MW IT capacity (35MW total facility power) hyperscale facility developed by GSA Data Center, JV of GULF (40% holding), the regional data center expertise of Singtel (via Nxera) (35% stake), and ADVANC (25% stake). Designed to TIA-942 Rated 3 standards with a design PUE below 1.35, the facility features four data halls split equally between air-cooled systems (12.8MW IT) and Thailand's first fully operationalized direct-to-chip liquid cooling infrastructure (12.8MW IT), engineered with high floor-load capacity (2-3 tons/sqm) to support ultra-dense AI racks exceeding 120kW+ to 132kW per rack, such as the NVIDIA GB200 NVL72 rack systems. GSA01 ensures high operational resiliency through dual 115kV MEA substation feeders, 3+1 redundant generators with 30-second rapid start, 2N underground fuel storage, 6-minute thermal buffer tanks, and robust natural disaster preparedness including an elevated the building floor elevated +1.5 meters above the main road (+4.5m above Mean Sea Level) and IBC Category D seismic structural design. Supported by a Bt7.3bn green loan from UOB and ADB along with renewable power options. Regarding capacity usage, management highlighted during the site visit that the facility is currently 100% fully contracted and utilized across its capacity.

Data center and AI businesses are key focus areas for GULF.  The plans for the Data Center Park in the EEC have become clearer after securing land to support a target capacity of 2,500MW, up from the current developing capacity of 95MWe IT. Negotiations with potential clients are underway, supported by power readiness and comprehensive fiber optic coverage from AIS. In parallel, Gulf Edge AI is executing its 7-layer AI stack strategy:   Foundations (Layers 1–2): Supported by GULF’s core power security and IT Data Center portfolio.   Current Focus (Layers 5–6): Entering the market through Tools & Orchestration and Field Deployment/Services to deliver AI transformation solutions. Next Phase (Layers 3–4): Expanding into GPUs and Models to build a sovereign AI platform and ultimately deliver a full-stack sovereign AI offering. To accelerate adoption, Gulf Edge AI has partnered with global leaders like Kore.ai (agentic customer service) and Cognizant (AI engineering and integration), while actively exploring partnerships in coding agents and cybersecurity to serve enterprise clients across telecommunications, banking & finance, and the public sector. These should support medium to long-term earnings growth for GULF.

Valuation & recommendation. We maintain our OUTPERFORM rating with a mid-2027 target price of Bt78, based on DCF valuation (6% WACC and 3% LT growth). We expect GULF is well-Leading market positioning to capture growth opportunity.

Key risks: Lower return on new investments and regulatory changes. Key ESG risk is the environmental impact from its exposure to fossil fuels.