PETALING JAYA: A firmer year is expected for the local technology sector, driven by the demand for artificial intelligence (AI) particularly as strength in logic and memory chips broaden into other sub sectors.
RHB Research said in a recent report the sector’s improving growth momentum is being supported by more optimistic guidance from most companies despite seasonal softness into the fourth quarter of last year, and the first quarter of this year.
“We see greater upside asymmetry in the second-line players, where improving fundamentals are yet to be fully reflected in share prices. The sector’s 22 times forward price-earnings ratio is positive versus more than 50% for earnings growth forecast this year,” RHB Research said.
The Semiconductor Industry Association (SIA) revised its projection on global semiconductor sales growth to 26% year-on-year, while industry body SEMI also raised its forecast on semiconductor equipment sales to US$145bil this year, with growth across both front-end and back-end segments.
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