Potential beneficiaries of Lam’s Malaysia push - Maybank KimEng report.

Can't download the full report, so just gonna extract a page from the report. Malaysian mentioned companies are $UWC / 5292 (UWC BERHAD) $FRONTKN / 0128 (FRONTKEN CORPORATION BERHAD) $GREATEC / 0208 (GREATECH TECHNOLOGY BERHAD) PENTA

However, personally as mentioned before, I believe $KOBAY / 6971 (KOBAY TECHNOLOGY BERHAD) and even $KGB / 0151 (KELINGTON GROUP BERHAD) may be a beneficiary.

Other key point: Lam Research’s Malaysia footprint will account for 37% of its enlarged 342,100 sf of manufacturing space globally.

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Lam Research a leading manufacturer of WFE equipment which are primarily used in deposition, etch and cleaning. Lam is based in California, and was founded in 1980. Lam’s manufacturing facilities span across the US, Austria, Korea, Taiwan and Malaysia. Lam’s closest competitors include Applied Materials and Tokyo Electron.

Recognising the tremendous long-term growth potential of semiconductor opportunities in Asia, Lam has made Malaysia a manufacturing centre of excellence. Its Batu Kawan (Penang) plant began production May-21, and should achieve USD3b of output by mid-2022 (FactSet consensus FYJun22E revenue: USD16.6b). SEMI expects 29 high volume fabs to break ground by 2022 (2021: 19, 2022: 10), which will spur equipment spend above USD140b in the coming years, and should begin in earnest in 2023. Of this, 20 fabs will be in Asia. Lam needs to localize and aid in upskilling of the local supply chain as this is a critical success factor to satisfy customers’ demand (i.e. scalability, timeliness and quality).

We attended Lam Research’s suppliers briefing and believe that Lam’s Asia expansion and push for localization could create interesting growth opportunities for some SG/MY-listed suppliers in the coming years. In our universe, we believe UMS/ Frencken/ Venture may be a good fit for Lam (i.e. either currently already a supplier/ may have the potential to do so
in the future). Among non-rated names, we do not rule out that JEP (UMS’ subsidiary), Grand Venture Technology and UWC may have opportunities to supply Lam in some way.

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