Malaysia vital to global semiconductor industry
PETALING JAYA: CIMB Research believes Malaysia remains an attractive destination for semiconductor manufacturing globally given the country's committed investments and a neutral party amid global trade tensions.
'With RM63bil in committed investments, an increase in local champions, and stronger Asean alignment, Malaysia is positioning itself as a neutral, indispensable node in the global chip supply chain,' the research house said.
It added that Malaysia's transition from a back-end assembly base to a design-to-packaging semiconductor hub remains a work in progress.
However, it said it was encouraged to see that the National Semiconductor Strategy (NSS) is gaining investor traction, institutional support, and regional momentum.
CIMB Research said the NSS, launched in May 2024, aims to shift Malaysia beyond a 'Made in Malaysia' model to a 'Made by Malaysia' one by strengthening local capabilities in integrated circuit (IC) design, research and development, advanced packaging, and nurturing homegrown champions across the value chain.
The research house said, since its launch, the NSS has attracted RM63bil in investments, of which RM58bil was foreign direct investment and RM5.2bil domestic direct investment.
'These investments underscore rising investor confidence in Malaysia's semiconductor ecosystem,' it added.
The research house said Malaysia aims to develop 10 local semiconductor firms with revenues exceeding US$1bil and 100 companies with revenues exceeding RM1bil.
'The government has identified 13 Malaysian-based companies across the semiconductor value chain as key beneficiaries, including Carsem (M) Sdn Bhd, Malaysian Pacific Industries Bhd (MPI), Inari Amertron Bhd , Pentamaster Corp Bhd , Vitrox Corp Bhd , and Kellington Group Bhd.
'In addition, promising IC design and services firms like Oppstar Bhd , SkyeChip Bhd, Infinecs Systems Sdn Bhd, and Experior Technology Sdn Bhd are also being nurtured to spearhead Malaysia's next phase of semiconductor growth,' the research house said, adding that more than RM2bil has been committed by government-linked investment companies and development banks via the GEAR-uP initiative.
CIMB Research's top picks in the Malaysian outsourced semiconductor assembly and test sector are Inari Amertron Bhd and MPI.
It also likes ViTrox for exposure to the automated test equipment sector.
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