Malaysia poised to gain from AI chip upcycle

KUALA LUMPUR: Malaysia is well-positioned to benefit from the global artificial intelligence (AI)-driven semiconductor upcycle through advanced packaging, AI infrastructure, semiconductor equipment demand and ongoing supply-chain diversification, said Apex Securities Bhd. In a note today, the research house said this was already evident in the country’s strong growth in electrical and electronics (E&E) exports. It said, E&E exports rose 39.5 per cent year-on-year in January 2026, supported by "rising semiconductor investments under the National Semiconductor Strategy and favourable exposure across our coverage, including Frontken, Mi Technovation, ViTrox, EG Industries , Inari, QES Group and Wentel." Apex Securities said Malaysia currently handles an estimated 13 per cent of global semiconductor assembly, testing and packaging activity. "The National Semiconductor Strategy has attracted more than RM63 billion in approved semiconductor-related investments, with the aim of doubling Malaysia’s share of the global semiconductor market from about seven per cent to 14 per cent by 2029," it said. The research house maintained its "overweight" call on the Malaysian technology sector. "However, following the sector’s strong re-rating, we believe investors should become increasingly selective. "The remaining upside is likely to be concentrated in companies with clear earnings catalysts, robust order visibility and proven execution, rather than being broadly available across the sector," it said.