KUALA LUMPUR: The technology sector’s shipment deferrals and new orders from launches of new products, models and innovations will flow into the second half of 2024 (H2’24) and beyond, said AmInvestment Bank Bhd.
In a research note today, the bank said that the sector is still recovering at a slow pace, and shipments have been requested to be deferred to a later period.
“Hence, more deliveries are expected to be seen in H2’24. With the gradual uptick in semiconductor sentiments and sales, we anticipate newer products, models, and introductions to be launched in H2’24. This bodes well for an improvement in semiconductor sales in H2’24 with higher revenue anticipated to be recognised by companies in the sector,” it said.
AmInvestment reported that UWC Bhd, the metal fabrication and value-added assembly services provider to the semiconductor industry, indicated some orders were deferred to a later period, and the company anticipated a more significant improvement in earnings in Q4’24, driven by contributions from the back-end semiconductor segment.
Another semiconductor player, Inari Amertron Bhd, continued to remain positive on the volume loading of products dedicated to the next-generation smartphone, it noted.
The bank maintained its “overweight” call on the sector based on positive revenue recovery prospects of semiconductor players this year and on more ongoing business activities in the front-end semiconductor space amid inventory corrections.
“The adoption of advanced technologies for the automotive and consumer electronics segments with leading-edge chips and new features for equipment and machines are expected to drive sales in the semiconductor sector.
“Increase in demand for artificial intelligence-related products to support the boom in the AI sector, and trade diversion strategy to leverage on the strength and production of multiple hubs and more cost-effective supply chains, benefiting local players as multinational companies divert their production to Malaysia,” it added. – Bernama
