iFAST Research Team
5G is the 5th generation global wireless standard after 1G, 2G, 3G, and 4G, which brings more capacity, faster speeds, and lower latency than previous generations of cellular network technologies.
5G enables us to connect virtually everything together including machines, objects, and devices, and will undoubtedly enhance the consumer’s experience to another new level.
For instance, 5G will enable the consumer to experience boundless Extended Reality (XR), seamless Internet of Things (IoT) capabilities, new enterprise applications, local interactive content, instant cloud access and so on.
On the other hand, businesses also will benefit from the adoption of 5G, as the high speed and reliable network of 5G technology are expected to boost the productivity and efficiency of businesses.
The 5G rollout is now in full swing globally with countries like the US, China and South Korea leading the way. 5G is expected to roll out widely across Malaysia from the end of 2021. As the 5G supercycle arrives, the Malaysian technology sector has emerged as a hotspot for investors seeking to gain exposure to the up-and-coming technology.
Below are the five Malaysian companies that could benefit from the 5G supercycle:
Inari Amertron Bhd
Inari Amertron Bhd is an 0utsourced semiconductor assembly and test (OSAT) service provider for radio frequency (RF), fiber-optics transceivers, optoelectronics, sensors, and custom integrated circuit (IC) technologies. Among the business segments of Inari, the radio frequency division contributed the most to the company’s revenue, about 45% of total revenue.
With the rollout of 5G’s deployment, higher demand on RF components would likely continue to generate robust earnings to Inari. In its 10th annual general meeting (AGM), the company revealed that they are expecting the RF segments would contribute up to 50% of the total revenue in FY 2021.
In addition, Inari stated in their latest quarterly report that they would continue to ramp up their production capacity in order to cater to the strong demand from the continued growth of 5G devices.
Unisem (M) Bhd
Unisem (M) Bhd provides semiconductor assembly and test services in Malaysia. Unisem’s assembly and test services include wafer bumping, wafer probing, wafer grinding, a range of lead frame and substrate integrated circuits packaging, wafer-level CSP (chip scale packaging), flip chip and radio frequency, analogue, digital and mixed-signal testing services.
With the growing commercialization of the 5G technology, most of Unisem’s operations are running at full capacity in order to cater for the greater chip demand for power management, radiofrequency automotive, and consumer electronics.
Looking ahead, the growing demand for RF and power management components going into 5G network base station solutions and 5G mobile devices would still be the major catalyst driven the performance of the company. The group has also stated that it will continue to focus on building its strength in RF, analogue and micro-electro-mechanical systems (MEMs) in order to fulfil the higher demand of 5G.
Malaysian Pacific Industries Bhd
Malaysian Pacific Industries Bhd is engaged in manufacturing, assembling, testing and selling integrated circuits, semiconductor devices, electronic components, and lead frames.
With greater demand for higher bandwidth and operating frequency under the revolution of 5G, the demand for power semiconductors is expected to surge at a promising rate and thus benefitting MPI in both the short and long run.
Other than that, MPI also foresees the demand for lead frames will continue its growth trend in the segment that is related to the 5G market power management chip. Catering for the growing demand, MPI has equipped themselves by acquiring an additional 121,000 sqft of production floor space in Ipoh as well as scouting for a new site to set up another factory by end of the year 2022.
JF Technology Bhd
JF Technology Bhd (JFTECH) engages in the manufacturing, packaging, marketing, trading, and distribution of electronic products and components. Its products include rigid style contact technology, high-current cantilever style, and manual actuator solutions. In addition, the firm engages in the design, development, custom manufacture, and sale of integrated circuit test sockets, interconnect, and test solutions and equipment for the semiconductor and electronics assembly markets.
As a leading innovator and manufacturer of high-performance test contacting solutions for globally integrated circuit makers, JFTECH continues to place utmost emphasis on their production lines in order to fit and capitalize on the existing 5G trend.
In FY2020, JFTECH was granted with additional 11 patents related to the invention of a high-frequency IC test contacting solution used mainly in 5G/RF/mmWave applications, making the company stand out among the industry players.
With the advent of the 5G network, the board of directors also foresee that the chips demand will be continued to increase and lead to greater demand for high-performance test contacting solutions.
Frontken Corp Bhd
Frontken Corp Bhd provides surface and mechanical engineering solutions, serving a wide range of heavy industries such as oil & gas, power generation, semiconductors, and the marine industry. It also provides various specialized engineering services, such as thermal spray coating, cold build-up coating, plating and conversion coating, specialized welding, precision cleaning, abrasive blasting, machining and grinding.
In addition, the company provides surface treatment and precision cleaning for the thin film transistor liquid crystal display and semiconductor industries.
Along with the gradual rollout of the 5G network not only in Malaysia but worldwide, Frontken – being the largest part treatment and cleaning service provider in Malaysia – is likely to be benefitted from the need for more maintenance services for machinery given the greater demand for semiconductors and chips under the advent of 5G technology. – July 4
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The views expressed are solely of the author and do not necessarily reflect those of Focus Malaysia.
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