SKS Technologies Rides A Data Centre Pipeline To A 40-Fold Return

Fund managers track a hyperscale data centre contracting boom that turned a small electrical contractor into a market darling

30 Jun 2026 · 7 min read

Naos Asset Management's June 2026 quarterly report said SKS Technologies has re-rated materially over the past 12 to 18 months, in several cases more than doubling in value, on the back of order books sitting at multi-year highs and a project mix shifting toward higher-margin work. Centennial Asset Management, describing its own continued exposure to the data centre, electrification and defence spending themes through the stock, said all three trade at premium valuations, but argued that at this stage in the cycle the story is about earnings momentum and trajectory rather than valuation multiples.

One of the things you learn over time is it's not so much about the valuation, it's about the trajectory of the company.

— Centennial Asset Management, Article, June 2026

A pipeline that kept resetting expectations

The scale of the re-rating shows up clearly in how quickly SKS Technologies' contracted pipeline has grown. Ellerston Capital said the stock was the top contributor across multiple of its funds in May 2026, rising 36.2 per cent for the month after a $22 million contract win for a major retailer's new headquarters lifted total work-in-hand to $355 million and FY27 secured revenue to $270 million, 35 per cent higher than where FY26 secured revenue stood at the start of July 2025. The manager said its tender pipeline had grown from $572 million in February 2026 to $1.25 billion by early May, describing SKS as a critical delivery partner for major Australian hyperscale data centre providers.

That step-change traces back to an $80 million scope expansion on the MEL02A hyperscale data centre contract with Stack Infrastructure, announced in April 2026. Ellerston Capital said the expansion lifted total work on that single project to $210 million, alongside a smaller maiden New South Wales data centre win from the recently acquired Delta Elcom business, and said the more consequential detail was the step-change in forward visibility, with total work on hand rising to $350 million and the FY27 component climbing to $240 million.

More consequential than the headline contract value was the step-change in forward visibility, with total work on hand rising to $350m and the FY27 component increasing to $240m.

— Ellerston Capital, Monthly Report, April 2026

A ten-bagger that prompted an exit

Not every early holder rode the stock all the way up. Merewether Capital exited its position entirely in May 2026 after the same $22 million Coles head office contract sent the tender pipeline up 120 per cent from what had been disclosed at the February half-year result, driven by an additional $600 million in data centre tenders. The manager described SKS as a frankly outstanding investment, purchased between March and August 2022 for roughly 20 cents and exited at $8.70 four years later, but said that with multiple brokers now covering the stock, many large funds now owning it and the shares trading around 50 times earnings, the expected returns equation had changed enough that it preferred to look for the next unloved microcap rather than continue holding.

SKS has been a frankly outstanding investment for the Fund — purchased between March and August 2022 for roughly 20c, with a final exit price of $8.70 only four years later.

— Merewether Capital, Monthly Report, May 2026

A founder-led business that got there early

Balmoral Investors traced the roots of that success back to SKS's history as a small electrical cabling business founded in 1981 by Peter and Greg Jinks, who remain on the board alongside current CEO Matthew Jinks, with the family retaining 36 per cent combined ownership. The manager noted the company had 12 per cent more shares on issue in 2025 than in 2020 despite its rapid growth trajectory, and remains debt-free, attributes it said typically safeguard prudent capital management. 1851 Capital, describing the stock as still a buy in September 2025, said over 70 per cent of the order book then came from data centres, up from zero four years earlier, positioning SKS early on a trend that has continued to build.

What managers are watching next

With Naos Asset Management's June 2026 update noting pricing power has improved as bid lists have shortened, the key questions for managers still holding SKS are whether execution risk, which Merewether Capital flagged as far back as February 2026 given the gap between half-year results and full-year guidance, remains manageable as the contracted backlog continues to scale, and whether the roughly $1.25 billion tender pipeline Ellerston Capital reported converts into further contract wins at the pace the market now appears to expect.