KUALA LUMPUR: MIDF Equities Research said Malaysia’s exports of semiconductor products remain healthy, despite the slowdown in global semiconductor sales.
“We believe that the outperformance, as compared to global semiconductor sales, was mainly attributable to the focus on niche growing segment especially those related to the Internet of Things (IoT) and a favourable foreign currency exchange,” it said.
Based on three-month-moving average sales figures, it said semiconductor exports amounted to RM11.5bil, an increase of 12.3% on-year in July 2015.
Between January and July 2015, exports increased by 8.8% on-year to RM77.4bil as compared to only RM71.1bil in 2014.
The research house maintained its Positive call on the semiconductor sector, stating that the demand for communication devices would continue to be supported by low-to-middle class consumers seeking to stay connected and to be at the forefront of the latest technological product offerings.
It said this would be in favour of electronic companies, which are able to offer end-products at competitive prices, thus, advocating a high volume business strategy.
“Semiconductor companies that positioned themselves in the right production value chain will in-turn benefit from the high volume orders.
“In the near term, new smartphones line-up this 2H15 is going to further excite the industry.
“On another note, given the high correlation between the semiconductor industry and global economy, we are expecting uninterrupted growth in the semiconductor industry for as long as the global economy continues to grow,” it said in a statement on Monday.
Global sales amounted to US$27.9bil in July 2015, a marginal decrease of 0.7% on-year.
“In our previous report dated Aug 6, 2015, we cautioned that there could be speedbumps in the upcoming months due to macroeconomic headwinds and softening demand.
“For the month-in-review, China was the main outperformer while in comparison sales in the Americas grew at a slower pace,” it said.
Semiconductor Industry Association (SIA) said global semiconductor sales had slowed partly due to softening demand, normal market cyclicality and currency devaluation in some regional markets.
