KUALA LUMPUR, July 2 — CIMB Securities Sdn Bhd expects further US dollar depreciation to weigh on the technology sector’s recovery in the second half of 2025.
In a research note, the brokerage said the impact is likely to be minimal for electronics manufacturing service players.
“Despite currency headwinds, we expect low single-digit quarter-on-quarter (q-o-q) sector sales growth in second quarter 2025 (2Q 2025) results, underpinned by stronger contributions from the automated test equipment segment,” it said.
Meanwhile, it said the outsourced semiconductor assembly and test (OSAT) segment is expected to post modest q-o-q sales growth, supported by resilient domestic demand in China and steady orders from the general-purpose server segment.
This is broadly in line with leading global semiconductor companies’ average sales growth forecast of 3.8 per cent q-o-q.
CIMB Securities has maintained its “Neutral” stance on the Malaysian technology sector, adding that its recovery remains elusive owing to a lack of momentum outside the AI space.
Near-term headwinds include the upcoming electricity tariff hike, new Employees’ Provident Fund (EPF) contributions for foreign workers, and potential demand volatility after July as the US tariff grace period expires.
“While valuations are below historical averages, sluggish demand visibility continues to weigh on earnings prospects,” it said.
