Latest news with #Frencken
Business Times
5 days ago
- Business
- Business Times
Singapore semiconductor firms exposed to planned US tariff, but impact may vary: analysts
[SINGAPORE] Semiconductor-related firms in Singapore are under the spotlight after President Donald Trump's threat of a US semiconductor tariff. However, the impact of the levy will vary based on each company's exposure levels, said analysts on Friday (Aug 8). On Thursday, Trump announced that he will impose a 100 per cent levy on imports that include semiconductors, though companies that have 'committed to build' in the US will be exempted. Frencken Group , which is a supplier to the semiconductor industry, will be indirectly exposed through its largest customers ASML and Applied Materials, said CGS International Singapore analyst William Tng. Frencken in June announced plans to invest S$63 million in a new and larger manufacturing facility in Singapore. ' AEM is more directly impacted as it ships to Intel, and Intel's main test and assembly is outside the US,' noted Tng. 'At the same time, Intel has invested in the US, so there seems to be room to negotiate.' On Thursday, Trump also urged Intel chief executive Tan Lip-Bu to resign immediately in a social media post due to so-called conflicts of interest, further intensifying pressure on the semiconductor giant. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up The shares of a slew of semiconductor companies in Singapore fell on Friday . UMS Integration was down 2.6 per cent, Frencken declined 2.4 per cent and AEM lost 3.2 per cent. It is not all negative news, however. Tng said that the impact could be mitigated by the tiered or gradual implementation of the semiconductor levy. He added that Frencken remains a 'top pick' in Singapore's tech rally. Frencken was also retained in UOB Kay Hian's alpha picks portfolio for August. The brokerage firm's portfolio in July had considerably outperformed the Straits Times Index, even with the looming announcement of the sectoral tariffs. Morningstar analyst Phelix Lee said that the firm is 'net bullish' on GlobalFoundries, as it already has manufacturing capabilities in the US. The semiconductor company has multiple facilities in Singapore as well. The case for United Microelectronics Corp is 'a bit more nuanced as (its) partnership with Intel will not begin production at least until 2027', added Lee. In response to a query from The Business Times, Ang Wee Seng, executive director of the Singapore Semiconductor Industry Association, said: 'Any significant trade action involving semiconductors will inevitably have far-reaching impact.' He added: 'This is a highly globalised industry, with complex and interdependent supply chains spanning across Asia and the world. Such a proposal, if enacted, could influence cost structures, supply strategies and long-term investment flows globally.' However, Ang said that it was too early to determine the specific impact on semiconductor firms in Singapore, saying that the industry will need to wait for the full details of the announcement to understand its scope and potential implications. Another industry insider, who declined to be named, pointed out that the impact of the tariff on the sector may not be uniform across the different Singapore-based semiconductor companies, which may be involved in making chips, performing assembly and test services, or supplying capital equipment. 'As result of the tariff, the cost of semiconductors may go up globally, and that may also increase (the) cost of equipment as highly automated machines use (a) very significant amount of semiconductors,' he said, using motion control systems as an example. Share of companies that already have facilities or investments in the US or plan to, went up shortly after market open on Friday. In South Korea, shares of Samsung and SK Hynix rose 2.6 and 1.5 per cent, respectively. At the end of the trading day, Samsung was 1.8 per cent up, while SK Hynix had declined 2.1 per cent. SK Hynix had last year announced a chip packaging facility in the US, while Samsung has chipmaking facilities in the country and has committed to investments. Shares of TSMC, the world's biggest chipmaker, advanced to a record high on Thursday. A Taiwanese official said that the firm is exempted from the chip tariff because it has set up plants in the US, according to Bloomberg. Lee posited that the semiconductor tariff could be negotiated, in line with Trump's strategy of 'open high, negotiate down', and that the final figures could be similar to reciprocal tariffs to limit inflation in consumer goods. The worst-case scenario of the levy could be some destruction of demand, added Tng, which will result in a need for further technological innovation demand. Ang noted: 'At a broader level, this underlines the growing need for stronger regional and global partnerships, supply chain resilience, and forward-looking strategies.'
Business Times
5 days ago
- Business
- Business Times
STI, semiconductor stocks fall, as Genting, Sembcorp, SGX decline
[SINGAPORE] Shares of some Straits Times Index (STI) constituents and semiconductor firms fell on Friday (Aug 8), on the impact of earnings reports as well as the US-imposed tariffs kicking in. Sembcorp suffered the steepest decline of close to 14 per cent on Friday morning, down to S$6.65 as at 9.04 am from its open price of S$7.05. The group before the market opened had reported earnings that fell 1 per cent to S$536 million for the first half ended Jun 30, on the back of lower turnover from its gas business. The counter closed 13.9 per cent or S$1.08 lower at S$6.72 at the end of Friday. Genting Singapore was down as much as nearly 4 per cent, but subsequently declined 3.31 per cent to S$0.73 at 9.29 am. It fell to an intra-day low of S$0.725 at 10.01 am. The company had reported on Thursday after market close a H1 profit that fell 34 per cent to S$234.7 million, on weaker gaming and room revenue. It closed on Friday at S$0.745, down S$0.010 or 1.3 per cent. The shares of national carrier Singapore Airlines (SIA) fell by more than 4 per cent to S$6.52 at 9.06 am, while OCBC fell 2.46 per cent to S$16.67. Both companies went ex-dividend on Friday. Shares of SIA closed the day at S$6.53, down 4.4 per cent or S$0.30, while the local bank's shares ended 1.8 per cent or S$0.30 lower at S$16.79. SGX rose to S$16.58 at 9.05 am, but declined to S$16.26 by 10.37 am and closed 2 per cent or S$0.32 down at S$16.02. The Singapore bourse posted a 2.6 per cent decline in H2 net profit on Friday, although it reported its highest-ever full-year revenue and net profit since listing. The STI was down 0.61 per cent on Friday morning, and ended the day 0.4 per cent or 18.32 points lower at 4,239.83. Losers outnumbered gainers 344 to 190, after 1.3 billion securities valued at around S$2 billion changed hands. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The counters of a slew of semiconductor companies in Singapore also fell following US President Donald Trump's announcement on Thursday that he would slap a 100 per cent tax on imports of semiconductors produced outside the US. Overall higher US tariffs came into effect on Thursday, with duties at a baseline rate of 10 per cent for many countries, and between 15 and 41 per cent for others. UMS declined by more than 5 per cent, but pared those losses to stand at about 2 per cent down at S$1.49. The counter closed Friday 2.6 per cent lower at S$1.48. Frencken earlier also tumbled by over 5 per cent, but ended Friday 2.4 per cent to S$1.63. AEM lost as much as 4.5 per cent, and closed the day 3.2 per cent lower at S$1.52. Analysts had earlier predicted that Trump's announcement might affect semiconductor-related companies in Singapore and Malaysia. CGS International (CGSI) said in a Friday report that Frencken would be indirectly exposed through Dutch semiconductor giant ASML and US company Applied Materials, which supply equipment to the semiconductor industry. AEM is more directly affected because it ships to Intel – and Intel's main test and assembly is outside the US, CGSI noted. But it added that Intel might have room to negotiate as it has invested in the US. CGSI said: 'Eventually, the worst-case scenario over time is likely some demand destruction as customers, suppliers and consumers in the US all bear part of the higher tariff, so further tech innovation demand (resulting in new exciting tech products) is needed.' It added: 'The outlook for tech in H2 2025 remains muted as tariffs continue to render cautious and slow decision-making.' The Straits Times reported that the proposed tariff would weigh heavily on companies in Singapore that package semiconductors, and potentially those producing components and intermediate products that are part of the chip-supply chain. The semiconductor industry accounts for nearly 6 per cent of Singapore's gross domestic product, based on the Economic Development Board's 2025 data. Tech stocks in Malaysia already fell on Thursday when the news broke. It triggered declines in 71 technology counters on Bursa Malaysia. Last year, Malaysia exported nearly RM120 billion (S$36.4 billion) in electrical and electronics products to the US, accounting for a fifth of its total electrical and electronics exports. Semiconductor exports alone amounted to RM60.6 billion or about 20 per cent of Malaysia's total chip shipments.
Business Times
5 days ago
- Business
- Business Times
Singapore semiconductor firms are exposed to planned US tariff, but impact may vary: analysts
[SINGAPORE] Semiconductor-related firms in Singapore are under the spotlight after President Donald Trump's threat of a US semiconductor tariff. However, the impact of the levy will vary based on each company's exposure levels, said analysts on Friday (Aug 8). On Thursday, Trump announced that he will impose a 100 per cent levy on imports that include semiconductors, though companies that have 'committed to build' in the US will be exempted. Frencken Group , which is a supplier to the semiconductor industry, will be indirectly exposed through its largest customers ASML and Applied Materials, said CGS International Singapore analyst William Tng. Frencken, in June, announced plans to invest S$63 million in a new and larger manufacturing facility in Singapore. ' AEM is more directly impacted as it ships to Intel, and Intel's main test and assembly is outside the US,' noted Tng. 'At the same time, Intel has invested in the US, so there seems to be room to negotiate.' On Thursday, Trump also urged Intel chief executive Tan Lip-Bu to resign immediately in a social media post due to so-called conflicts of interest, further intensifying pressure on the semiconductor giant. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up The shares of a slew of semiconductor companies in Singapore fell on Friday . UMS Integration and Frencken both declined more than 5 per cent, while AEM lost 4.5 per cent shortly after market open. It is not all negative news, however. Tng said that the impact could be mitigated by the tiered or gradual implementation of the semiconductor levy. He added that Frencken remained a 'top pick' in Singapore's tech rally. Frencken was also retained in UOB Kay Hian's alpha picks portfolio for August. The brokerage firm's portfolio in July had considerably outperformed the Straits Times Index, even with the looming announcement of the sectoral tariffs. Morningstar analyst Phelix Lee said that the firm is 'net bullish' on GlobalFoundries as it already has manufacturing capabilities in the US. The semiconductor company has multiple facilities in Singapore as well. The case for United Microelectronics Corp is 'a bit more nuanced as (its) partnership with Intel will not begin production at least until 2027', added Lee. In a response a query from The Business Times, Ang Wee Seng, executive director of the Singapore Semiconductor Industry Association, said: 'Any significant trade action involving semiconductors will inevitably have far-reaching impact.' He added: 'This is a highly globalised industry, with complex and interdependent supply chains spanning across Asia and the world. Such a proposal, if enacted, could influence cost structures, supply strategies, and long-term investment flows globally.' However, Ang said that it was too early to determine the specific impact on semiconductor firms in Singapore, saying that the industry will need to wait for the full details of the announcement to understand its scope and potential implications. Another industry insider, who declined to be named, pointed out that the impact of tariffs on the sector may not be uniform across the different Singapore-based semiconductor companies, which may be involved in making chips, performing assembly and test services, or supplying capital equipment. 'As result of tariffs, the cost of semiconductors may go up globally and that may also increase (the) cost of equipment as highly automated machines use (a) very significant amount of semiconductors,' he said, using motion control systems as an example. Companies that already have facilities or investments in the US, or plan to, went up shortly after market open on Friday. In South Korea, shares of Samsung and SK Hynix rose 2.6 and 1.5 per cent, respectively. At the end of the trading day, Samsung was 1.8 per cent up, while SK Hynix had declined 2.1 per cent. SK Hynix had last year announced a chip packaging facility in the US, while Samsung also has chipmaking facilities there and has committed to investments in the United States. Shares of TSMC, the world's biggest chipmaker, advanced to a record high on Thursday. A Taiwanese official said that the firm is exempted from the chip tariffs because it has set up plants in the US, according to Bloomberg. Lee posited that the semiconductor tariff could be negotiated, in line with Trump's strategy of 'open high, negotiate down', and that the final figures could be similar to reciprocal tariffs to limit inflation in consumer goods. The 'worst-case scenario' of the levy could be some destruction of demand, added Tng, which will result in a need for further technological innovation demand. Ang noted: 'At a broader level, this underlines the growing need for stronger regional and global partnerships, supply chain resilience, and forward-looking strategies.'
Business Times
5 days ago
- Business
- Business Times
Singapore semiconductor firms are exposed to planned US tariffs, but impact may vary: analysts
[SINGAPORE] Semiconductor-related firms in Singapore are under the spotlight after President Donald Trump's threat of US semiconductor tariffs. However, the impact of the levy will vary based on each company's exposure levels, said analysts on Friday (Aug 8). On Thursday, Trump announced that he will impose a 100 per cent levy on imports that include semiconductors, though companies that have 'committed to build' in the US will be exempted. Frencken Group , which is a supplier to the semiconductor industry, will be indirectly exposed through its largest customers ASML and Applied Materials, said CGS International Singapore analyst William Tng. Frencken, in June, announced plans to invest S$63 million in a new and larger manufacturing facility in Singapore. ' AEM is more directly impacted as it ships to Intel, and Intel's main test and assembly is outside the US,' noted Tng. 'At the same time, Intel has invested in the US, so there seems to be room to negotiate.' On Thursday, Trump also urged Intel chief executive Tan Lip-Bu to resign immediately in a social media post due to so-called conflicts of interest, further intensifying pressure on the semiconductor giant. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up The shares of a slew of semiconductor companies in Singapore fell on Friday . UMS Integration and Frencken both declined more than 5 per cent, while AEM lost 4.5 per cent shortly after market open. It is not all negative news, however. Tng said that the impact could be mitigated by the tiered or gradual implementation of the semiconductor levy. He added that Frencken remained a 'top pick' in Singapore's tech rally. Frencken was also kept in UOB Kay Hian's alpha picks portfolio for August, which considerably outperformed the Straits Times Index in July, even with the looming announcement of the sectoral tariffs. Morningstar analyst Phelix Lee said that the firm is 'net bullish' on GlobalFoundries as it already has manufacturing capabilities in the US. The semiconductor company has multiple facilities in Singapore as well. The case for United Microelectronics Corp is 'a bit more nuanced as (its) partnership with Intel will not begin production at least until 2027', added Lee. In a response a query from The Business Times, Ang Wee Seng, executive director of the Singapore Semiconductor Industry Association, said: 'Any significant trade action involving semiconductors will inevitably have far-reaching impact.' He added: 'This is a highly globalised industry, with complex and interdependent supply chains spanning across Asia and the world. Such a proposal, if enacted, could influence cost structures, supply strategies, and long-term investment flows globally.' However, Ang said that it was too early to determine the specific impact on semiconductor firms in Singapore, saying that the industry will need to wait for the full details of the announcement to understand its scope and potential implications. Another industry insider, who declined to be named, pointed out that the impact of tariffs on the sector may not be uniform across the different Singapore-based semiconductor companies, which may be involved in making chips, performing assembly and test services, or supplying capital equipment. 'As result of tariffs, the cost of semiconductors may go up globally and that may also increase (the) cost of equipment as highly automated machines use (a) very significant amount of semiconductors,' he said, using motion control systems as an example. Companies that already have facilities or investments in the US, or plan to, went up shortly after market open on Friday. In South Korea, shares of Samsung and SK Hynix rose 2.6 and 1.5 per cent, respectively. At the end of the trading day, Samsung was 1.8 per cent up, while SK Hynix had declined 2.1 per cent. SK Hynix had last year announced a chip packaging facility in the US, while Samsung also has chipmaking facilities there and has committed to investments in the United States. Shares of TSMC, the world's biggest chipmaker, advanced to a record high on Thursday. A Taiwanese official said that the firm is exempted from the chip tariffs because it has set up plants in the US, according to Bloomberg. Lee posited that the semiconductor tariff could be negotiated, in line with Trump's strategy of 'open high, negotiate down', and that the final figures could be similar to reciprocal tariffs to limit inflation in consumer goods. The 'worst-case scenario' of the levy could be some destruction of demand, added Tng, which will result in a need for further technological innovation demand. Ang noted: 'At a broader level, this underlines the growing need for stronger regional and global partnerships, supply chain resilience, and forward-looking strategies.'
Business Times
5 days ago
- Business
- Business Times
STI stocks fall, as SIA, Genting, Sembcorp, OCBC tumble
[SINGAPORE] Shares of several Straits Times Index (STI) constituents fell in early trade on Friday (Aug 8), on the impact of earnings and amid tariffs kicking in. Sembcorp suffered the steepest decline, as it dived more than 13 per cent. It was last down 13.1 per cent at S$6.78. On Friday, before the market opened, it reported earnings that fell 1 per cent to S$536 million for the first half ended Jun 30, on the back of lower turnover from its gas business. Genting Singapore was down nearly 4 per cent to S$0.725. On Thursday, after market close, it reported H1 profit that fell 34 per cent to S$234.7 million on weaker gaming and room revenue. Singapore Airlines were more than 4 per cent to trade at S$6.55, while OCBC fell 2.3 per cent to S$16.69. Both companies went ex-dividend on Friday. The STI was down 0.4 per cent. Higher US tariffs came into effect on Thursday, with duties at a baseline rate of 10 per cent for many countries and between 15 and 41 per cent for some. The counters of a slew of semiconductor companies in Singapore also fell as US President Donald Trump announced on Thursday that he would slap a 100 per cent tax on imports that include semiconductors produced outside the US. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up UMS declined more than 5 per cent to S$1.44, while Frencken tumbled more than 5 per cent to S$1.59. AEM lost 4.5 per cent to trade at S$1.50. Analysts had earlier said that it might affect semiconductor-related companies in Singapore and Malaysia. In a Friday note, CGSI said Frencken will get indirect exposure via Dutch semiconductor giant ASML and US company Applied Materials, which supplies equipment to the semiconductor industry. Frencken supplies to both companies. The current situation is bullish for TSMC as it already has manufacturing capacity in the US, Morningstar said. TSMC shares soared nearly 5 per cent on Thursday. As for AEM, it is more directly affected as it ships to Intel – and Intel's main test and assembly is outside of the US, CGSI noted. But it also added that Intel might have room to negotiate as it has invested in the US. 'Eventually, the worst-case scenario over time is likely some demand destruction as customers, suppliers and consumers in the US all bear part of the higher tariff, so further tech innovation demand (resulting in new exciting tech products) is needed,' said CGSI. 'The outlook for tech in H2 2025 remains muted as tariffs continue to render cautious and slow decision-making,' it added. According to a Straits Times report, the proposed tariff would weigh heavily on companies in Singapore that package semiconductors, and potentially also to components and intermediate products that are part of the chip supply chain. The semiconductor industry accounts for nearly 6 per cent of Singapore's gross domestic product, based on Economic Development Board data as at 2025. Tech stocks in Malaysia already fell on Thursday on the news. It triggered declines in 71 technology counters on Bursa Malaysia. Last year, Malaysia exported nearly RM120 billion (S$36.4 billion) in electrical and electronics products to the US, accounting for a fifth of its total electrical and electronics exports. Semiconductor exports alone amounted to RM60.6 billion or about 20 per cent of Malaysia's total chip shipments.
