Sales Slowdown in July 2022
The global semiconductor sales slowed down to a 7% YoY growth in July 2022 (the first time since December 2020) to USD49.0bn primarily due to a decline in sales from the Chinese market (-2% YoY). On a MoM basis, sales eased to 2% dragged by the drop in sales from the US, China, Asia Pacific/Others markets, offsetting the improvement in Europe and Japan. We believe the cool down in semiconductor sales are due to 1) global inflationary pressure which have been affecting consumer spending, 2) continuous lockdowns in China and therefore, a decline global manufacturing production, 3) prolonged supply chain disruption (unresolved chips shortage issue), and 4) labour shortage.
All Eyes on the Launch of iPhone 14
Though the global smartphone shipments fell by 9% YoY in 2Q22, yet iPhone manage to achieve a higher market share at 17%, up by 3% YoY, in the second place after Samsung (21% market share in 2Q22), according to Canalys – the global technology analyst firm. Meanwhile, all Chinese smartphone vendors; Xiaomi, Oppo, and Vivo market share dropped or to 14% (-3% YoY), 10% (-1% YoY), and 9% (-1% YoY) respectively. Similarly, Counterpoint’s Global Monthly Handset Sales Tracker for April 2022 reported that Apple’s iPhone 13 models captured the top three spots (a total of 12% market share) (Chart 3), and maintained a lead every month since its launch. We foresee the launch of iPhone 14 during the slowdown in the global economy amid the inflationary environment would test the worldwide demand for smartphone.
Remain Optimistic on Malaysia OSAT Despite the Challenging Environment
We remain optimistic on Malaysia Outsourced Semiconductor and Testing (OSAT) despite the challenging environment within the semiconductor industry. The sector’s outlook will be driven by aggressive network migration to 5G, increase components for 5G smartphone, adoption of internet of Things (IoT), recovery in automotive segment and growing demand for electrical vehicles (EV), and data centre.
OVERWEIGHT Call on the
Sector We maintain an OVERWEIGHT call on the semiconductor, Technology sub-sector with a BUY call on Inari (TP: RM3.75) and MPI (TP: RM40.20).
Source: BIMB Securities Research - 8 Sept 2022
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Created by kltrader | Mar 18, 2024
Created by kltrader | Mar 13, 2024