Latest news with #US-imposed
Focus Malaysia
5 hours ago
- Business
- Focus Malaysia
Local tech sector holds steady with stronger growth expected in 2Q
COLLECTIVELY, the tech sector result was largely in line with expectations, with five companies meeting projections and one outperforming estimates. However, three players had numbers that missed expectations, due to slower order recognition, margin compression, and FX impact. Most players booked declining earnings, except for Coraza Integrated Technology (Coraza), which maintained its revenue despite margin pressures from ASP erosion, pre-opening expenses, and higher costs. Engineering support players continue to book robust revenue growth, seen as a precursor to growth in automated test equipment or ATE manufacturers as well as outsourced semiconductor assembly and test. 'Hence, we expect stronger numbers heading into quarter two (2Q) and the second half (2H), supported by a broader recovery across the semiconductor supply chain,' said RHB. Order and revenue trends remain constructive, supported by a sector recovery and potential front-loading activities, despite the ongoing uncertainty from US tariffs. Most management teams have adopted an optimistic tone, on stronger loadings with the replacement cycle, new product introductions, a demand recovery, and technology advancements. These trends are further bolstered by new opportunities emerging from China Plus One and Taiwan Plus One strategies. 'Our outlook still leans towards the positive, that Malaysia stands to benefit from US-imposed tariffs, via short-term rushed orders and long-term manufacturing reallocation activities,' said RHB. The country's robust ecosystem, talent pool, and infrastructure provide a competitive advantage. While excessive inventory build-up could raise demand uncertainties, the sector remains in an upcycle, showing minimal signs of major disruptions so far. Malaysian Pacific Industries and UNI are key beneficiaries of the chip sector recovery, China's demand rebound, and the commencement of new programmes and customers. On the domestic front, CTOS Integrated Technology is a standout, as it leverages on the digitalisation trend and has exposure to the fintech segment. Among the smaller-cap stocks, Coraza should see a sterling earnings rebound, supported by robust revenue growth. Tariff concerns slowing end demand, slower-than-expected orders, technology obsolescence, and unfavourable FX movements. —June 20, 2025 Main image: New Straits Times
The Star
17 hours ago
- Business
- The Star
Tech sector on the upswing as recovery emerges
RHB Research said it believes Malaysia stands to benefit from US-imposed tariffs via short-term rushed orders and long-term manufacturing reallocation activity. PETALING JAYA: RHB Research remains positive on the local technology sector despite muted earnings in the first quarter of the year (1Q25), as stronger revenue trends and optimistic guidance from many companies point to a continued recovery. 'Engineering support players continue to book robust revenue growth – seen as a precursor to growth for automated test equipment manufacturers as well as outsourced semiconductor assembly and test players,' the research house said. RHB Research expects stronger numbers in the second quarter and second half of the year, supported by a broader recovery across the semiconductor supply chain. It forecast earnings growth for the sector at 2% year-on-year (y-o-y) for this year and 40% y-o-y next year. 'Order and revenue trends remain constructive, supported by a sector recovery and potential front-loading activities, despite the ongoing trade uncertainty. 'Most management teams have adopted an optimistic tone due to stronger loadings with the replacement cycle, new product introductions, demand recovery, and technology advancements. These trends are further bolstered by new opportunities emerging from the China Plus One and Taiwan Plus One strategies to diversify supply chains,' RHB Research added. The research house said it believes Malaysia stands to benefit from US-imposed tariffs via short-term rushed orders and long-term manufacturing reallocation activity. 'The country's robust ecosystem, talent pool, and infrastructure provide a competitive advantage. While excessive inventory build-up could raise demand uncertainty, the sector remains in an upcycle, showing minimal signs of major disruptions so far,' RHB Research said. It pointed out that after the industry's sell-down, the sector's valuations have become compelling, offering an attractive risk reward ratio. The research house said the sector is trading at 20 times its forward price-earnings ratio and expects a re-rating as earnings strengthen and global uncertainties ease. Reviewing the sector's 1Q25 results, RHB Research said the results were largely in line with expectations, with five companies under its coverage meeting projections and one outperforming estimates. However, three companies had numbers that missed expectations, due to slower order recognition, margin compression, and foreign exchange impacts. It pointed out that most players booked declining earnings, except for Coraza Integrated Technology Bhd , which maintained its revenue despite margin pressures from average selling price erosion, pre-opening expenses, and higher costs. RHB Research's top picks for the sector are Malaysian Pacific Industries Bhd and Unisem (M) Bhd which are key beneficiaries of the chip sector's recovery, China's demand rebound, and the commencement of new programmes and customers. It added that CTOS Digital Bhd was a standout as it leveraged the digitalisation trend and has exposure to the fintech segment.
New Straits Times
2 days ago
- Business
- New Straits Times
Malaysia poised to benefit from US-China tech decoupling
KUALA LUMPUR: Malaysia's technology sector is well-positioned to benefit from ongoing United States-China trade tensions as global manufacturers seek to diversify their supply chains, according to RHB Investment Bank Bhd (RHB Research). The firm said the country's established semiconductor ecosystem, strong infrastructure and skilled talent base give it a competitive edge amid shifting production strategies, particularly under the "China Plus One" and "Taiwan Plus One" frameworks. "Malaysia stands to benefit from US-imposed tariffs via short-term rushed orders and long-term manufacturing reallocation activities," said analysts Lee Meng Horng and Miza Izaimi in a research note today. They said companies are increasingly mitigating geopolitical risks by relocating part of their operations to alternative locations in Asia, and Malaysia remains a top choice due to its track record and capacity. "The country's robust ecosystem, talent pool and infrastructure provide a competitive advantage," they added. RHB Research maintained a positive outlook for the technology sector despite near-term demand uncertainties stemming from excessive inventory build-up. It said the technology upcycle remains intact, with little evidence so far of major disruptions from global trade frictions. It also noted that Malaysia's position in the global semiconductor supply chain is expected to strengthen as multinational firms seek more resilient and diversified manufacturing bases. "The sector remains in an upcycle, showing minimal signs of major disruptions so far," the firm said. Despite macroeconomic uncertainties and ongoing trade challenges, RHB Research expects structural shifts in global supply chains to support Malaysia's long-term growth in high-tech manufacturing.
Canada Standard
2 days ago
- Business
- Canada Standard
South Korea strengthens economic ties with US to have China-free supply chain
Seoul [South Korea], June 18 (ANI): South Korea is actively pursuing 'China-free' supply chains by strengthening its economic ties and making new investments in the United States. This strategic shift comes amid ongoing trade tensions between the US and China, creating both opportunities and risks for global economies, including Korea. As reported by the Korea Herald, President Lee Jae Myung's administration is prioritizing economic cooperation with Washington, particularly in shipbuilding, energy, and critical minerals. While a planned meeting between President Lee and US President Donald Trump at the G7 summit didn't occur, a summit is anticipated at the upcoming NATO summit. Both US and South Korea are working on to strengthen their economic ties, since President Lee's took charge earlier this month. The two countries are expecting to look for cooperation in shipbuilding, energy and critical minerals, as well as negotiate the US-imposed tariffs on Korean exports. Korean businesses are quickly adapting to this new economic landscape. Korea Herald reports that SK Group Chairman Chey Tae-won has discussed with President Lee strategies for Korean industries to collaborate with the US in areas like AI, semiconductors, and mobility, demonstrating how Korean companies can support the US's goal of reducing reliance on China in supply chains. A significant move in this direction was Korea Zinc's USD 85 million investment to acquire a 5 per cent stake in The Metals Company, a Canadian deep-sea mining firm focused on EV and low-carbon energy metals. Korea Zinc stated this investment positions them as a crucial player in non-China supply chains due to The Metals Company's China-independent assets and technologies. Additionally, Korea Zinc recently made its first export of antimony, a strategic element used in electronics and military products, to the US, signaling its expansion into the American market. Korean Industry officials anticipate that,' Once allied economies such as Korea and the US begin discussing specific areas of cooperation through summits, companies are projected to be in step with them and move quickly.' (ANI)
Mint
2 days ago
- Business
- Mint
Gold prices poised for a 6-month winning run — first time in 23 years: Should you invest amid this historic rally?
Gold prices have been caught in a strong bull run this year, supported by multiple factors—including a weaker US dollar, expectations of rate cuts by the Federal Reserve, and recession fears triggered by US-imposed global tariffs. In India, where gold has crossed the ₹ 1,00,000 per 10 grams mark, the rally gained fresh momentum amid renewed geopolitical tensions between Iran and Israel. Although prices have eased slightly from record highs, they remain elevated and are poised to close higher for a sixth consecutive month. The US market shows a similar trend. Spot gold prices in the US closed higher for the fifth month straight in May, a streak last seen in May 2017. The yellow metal is already up over 3% in June, and here's where it gets interesting: if gold ends positive in June, it would mark a rare six-month winning streak, last witnessed 23 years ago, in May 2002, according to a report by Axis Securities. In the past 75 years, such a streak has occurred only 13 times, and history suggests this bodes well for long-term investors. Data shows that over the next 12 months, gold prices rose about 85% of the time, delivering an average return of nearly 50%. Looking ahead two years, the win rate remained strong, with average gains nearing 100%. "The takeaway here is that the six-month winning streak has been a solid signal for long-term investors to allocate more of their wealth to Gold as the purchasing power of the dollar erodes, in turn triggering the slow but evident process of global de-dollarization," Axis Securities said. Apart from historical, the fundamental backdrop for gold also remains favourable. Carsten Menke, Head Next Generation Research, Julius Baer, said barring a significant economic impact or a spreading in the region, the gold market is likely to lose its interest in the conflict sooner or later, as suggested by similar events in the past. Nonetheless, Menke sees the conflict as an element that is supporting the prevailing bullish mood in the gold market, while fundamentals remain favourable. "Demand from safe-haven seekers should stay strong amid prevailing economic and political uncertainties. Buying from central banks should stay strong as well, considering their desire to be less dependent on the US dollar as a reserve currency. We reiterate our Constructive view on gold against this backdrop," he added. In the short term, US gold prices are primed to reach the $3,600-$3,800 zone, where Axis Securities said it would advise swing traders to book profits since it believes the dollar is close to reversing its decline. On the downside, $3,245 is critical – anything under that, and a bigger drop below $3,000 becomes a real risk, it added. In summary, all eyes are on $3,289 for between now and month-end. The current trading range for gold is seen between ₹ 98,500 to ₹ 1,00,500 in the near term, according to Jateen Trivedi, VP Research Analyst - Commodity and Currency, LKP Securities. US Fed's interest rate decision, geopolitical tensions between Iran and Israel and progress in global trade negotiations are expected to drive volatility and set the directional tone for gold, he opined. Disclaimer: This story is for educational purposes only. The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
