MONEY MASTER

RHB Investment Bank is staying bullish on Malaysia’s tech sector , maintaining its  OVERWEIGHT rating  as recovery momentum builds and valuations remain attractive. The sector is now trading at  below 20x forward P/E , well under its 5-year average—opening the door for a potential  re-rating . Why RHB Is Optimistic: Earnings Strength : Across the supply chain, companies are showing stronger revenue and giving  positive forward guidance . Engineering Support Services  report robust  order books , often a leading signal for  automated test equipment (ATE)  and  OSAT providers . EMS players  (Electronics Manufacturing Services) see  healthy visibility , backed by new project wins and customer interest. New tech rollouts, product launches, and demand recovery  are expected to boost the sector through 2H25. Malaysia’s Strategic Advantage: Short-term boost from  order diversion  and long-term gain from  manufactur...

The Trump administration is moving to  tighten export controls on advanced AI chips , with Malaysia and Thailand identified as potential rerouting hubs. According to Bloomberg sources, the proposed policy—still in draft stage—would require US chipmakers such as  Nvidia Corp  to obtain licenses before shipping high-performance AI processors to these two Southeast Asian nations. While exemptions are reportedly under consideration for US allies and to maintain supply chain continuity, the proposal signals a  broadening of US semiconductor restrictions —one that may introduce  new volatility for chip-related businesses and infrastructure players in the region. Strategic Implications for Southeast Asia Malaysia and Thailand play a  critical role in the global chip supply chain , especially in  packaging, testing, and assembly . Any policy that introduces compliance uncertainty or additional licensing hurdles could prompt: Delays in chip delivery schedules R...

Malaysian semiconductor companies are expected to face near-term earnings pressure due to the recent strengthening of the ringgit against the US dollar , according to TA Securities . The research house estimates that a 1% drop in the US dollar could reduce the earnings of Inari Amertron Bhd by 1.3% and Unisem (M) Bhd by nearly 4% . Despite this, TA Securities maintains a positive outlook on the sector's medium- to long-term prospects . The firm noted that the ongoing global recovery in demand for semiconductors and rising trade diversion should continue to support Malaysian semiconductor firms. TA Securities kept its ‘overweight’ call on the sector and views the recent market correction as an opportunity for investors to accumulate oversold semiconductor stocks . The US dollar recently declined by 11% to a three-year low against the ringgit before rebounding sharply. Given that semiconductor sales and costs are largely denominated in the US dollar, currency fluctuations h...

  Key Takeaways: Profit Decline : Unisem (M) Bhd's net profit fell 29% to RM16.76 million in Q2FY2024 from RM24 million a year earlier. Revenue Increase : Despite the profit drop, revenue rose 4% to RM394.59 million due to higher sales volume and favorable USD to ringgit exchange rates. Dividend Announcement : Unisem declared a second interim dividend of two sen per share, payable on October 4. Earnings Per Share : EPS decreased to 1.04 sen from 1.48 sen. Six-Month Performance : For the first half of 2024, net profit decreased to RM25.22 million from RM33.79 million, while revenue grew to RM759.36 million from RM732.70 million. Industry Outlook : The semiconductor industry remains cautious, but Malaysia could benefit from global trade shifts and the National Semiconductor Strategy (NSS). Despite the profit decline, Unisem's share price increased by eight sen to RM4.20 at midday, valuing the company at RM6.77 billion.