Bualuang Securities (BLS) has released an analysis on Gulf Development Public Company Limited (SET: GULF), drawing comparisons with three global giants—Reliance, SK Group, and NTT—while highlighting the data center business as a significant new growth engine for the company.
Bualuang notes that GULF is following a proven model used by these international corporations: leveraging stable cash flows from high-capital, legacy infrastructure businesses to invest in new, higher-margin sectors such as compute, data, and financial services.
Reliance, SK Group, and NTT each started from infrastructure-heavy, regulated utility sectors like oil refining, telecommunications, or phone networks. They subsequently used cash flows generated from these traditional operations to expand into higher-margin businesses.
For example, Reliance funded the expansion of Jio’s 4G network using cash flows from its oil and petrochemical business, creating a clear blueprint for integrating energy, telecom, and fintech operations. SK Group established an ‘AI Co.’ structure worth KRW 2,100 trillion ($1.36 trillion), connecting chip, energy, and telecom businesses. NTT, meanwhile, moved its stable-income data center assets into a REIT, freeing up capital for further investment while reducing reliance on its balance sheet.
GULF appears to be on a similar trajectory, using steady cash flow from its gas-fired power plants, which are backed by Power Purchase Agreements (PPAs), to drive its expansion into data centers and digital infrastructure.
The three international precedents suggest tangible pathways for GULF’s potential. Reliance provides an example of successful transformation over a decade, SK Group offers a business structure closely aligned to GULF/ADVANC/THCOM, and NTT provides a relevant financing model.
Bualuang highlights immediate value creation from linking green power businesses to computing services. Of the four synergies outlined by GULF—Power-to-Compute, leveraging the ADVANC customer base into financial services, green power sales, and utilizing THCOM for system continuity—the analyst sees the strongest and fastest potential from the first and third.
GULF is shifting its data center model from a 40% stake in joint ventures to acting as a project developer with a 70% stake in GEDC01, targeting capacity expansion to 1,000 MW in 3-5 years and 1-2 GW in the long run. These plans are backed by Thailand’s low construction costs and confirmed hyperscaler demand from Google, Microsoft, and AWS.
Additionally, GULF’s renewable energy portfolio, including hydropower in Laos and hybrid renewables in Oman, can be structured into long-term Green PPAs to serve its own data center clients, converting ESG-related costs into added value and higher-margin revenue streams.
Key factors for investors to monitor include financial signals of a successful transition. If GULF mirrors the SK Inc. model, its financial results will reflect not only higher EBITDA but also a structural shift toward digital and AI-related earnings, particularly as its share in the data center business increases.
Company-wide EBITDA and revenue will rise significantly as GULF transitions from minority stakes to majority or full ownership of new data center projects. While premium pricing in the AI and data center power sector will likely improve margins, short-term capex will outpace profit growth, and debt levels will rise but remain manageable.
Investors are also recommended to watch for announcements of new investments in AI-related businesses or funds, further capital deployments, and possible slower dividend growth as more cash flow is reinvested for business expansion.
Bualuang’s sum-of-the-parts valuation already reflects the clear value of GULF’s core businesses—power plants, ADVANC, THCOM, data centers, and digital asset exchanges. Consequently, the brokerage maintains its ‘Buy’ rating with a target price of THB 78.00 and continues to select GULF as its top pick among stocks in the power plant sector.
