Gerard Lam

GillianTan78 | Joined since 2020-10-20

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1 week ago | Report Abuse

Key facts:
1. ICPS has not been issued by DNeX Semi, so CGP has no right to subscribe for additional ordinary shares
2. SilTerra is and must always be 55% Malaysian owned, dispute will not result in favorable outcome for foreign parties trying to wrestle controlling stake purely for economic purposes
3. Last resort, CGP is more than welcomed to sell their 40% stake in SilTerra. Many others especially Foxconn waiting desperately in queue.
4. Most sellers today were retailers, institutions pop up to acquire DNeX shares at attractive prices
5. Cancelling LTA by CGP may result in huge penalties payable by CGP, but more than welcome if they do so. Free money for SilTerra + capacity can be better used for Foxconn for EV ambitions

Stock

1 week ago | Report Abuse

Key facts:
1. ICPS has not been issued by DNeX Semi, so CGP has no right to subscribe for additional ordinary shares
2. SilTerra is and must always be 55% Malaysian owned, dispute will not result in favorable outcome for foreign parties trying to wrestle controlling stake purely for economic purposes
3. Last resort, CGP is more than welcomed to sell their 40% stake in SilTerra. Many others especially Foxconn waiting desperately in queue.
4. Most sellers today were retailers, institutions pop up to acquire DNeX shares at attractive prices
5. Cancelling LTA by CGP may result in huge penalties payable by CGP, but more than welcome if they do so. Free money for SilTerra + capacity can be better used for Foxconn for EV ambitions

Stock

1 week ago | Report Abuse

DNeX's 2 large cash generating engines - SilTerra and Ping is widely expected to double it's profits in FY23.

Overall

SilTerra:

Secured agreement to supply wafers to World's Number 1 Low Energy Bluetooth company - Nordic Semiconductor ~ Cash upfront is 1.4x of current 8 inch wafer prices due to shortage of such specialty design.

Secured agreement to supply MEMS wafers to Number 1 Semiconductor company in the Middle East ~ Pearl Semiconductor ~ Cash upfront 3x of current 8 inch wafer prices due to 1st in the world design of such MEMS specialty design.

Cash upfront deposit of 40% from existing LTA covering 60% of existing capacity + re-opening of China economy spurring demand for Driver IC's

Ping Petroleum:

Completion of repair of a key component of Anasuria Cluster to boost productivity by 50%, resulting in Ping profit to potentially double provided oil is at current prices ~US$80-90/bbl.



Surprises

Much to our surprise, SilTerra is moving up the global SIlicon Photonics and MEMS value chain at a rapid pace, due to its early investments in such technology and collaboration with global semiconductor R&D giant iMEC.

As global chip company scramble due to high inventory levels for conventional PC chips, SilTerra is insulated from such oversupply due to its superior inbuilt technology to supply these next generation chips that are expected to be mass adopted beginning from the end of FY23.



Expectations

EPF accumulated a stake of up to 3.8% based on latest Annual Report filed ~ While this was widely expected by us, it is still a very positive news given large local ongoing institutional support.

Foreign institutional funds begin to upstake DNeX due to their better understanding of the widely positive financial impact from mass adoption of MEMS and Silicon Photonics by global conglomerates, especially in the use of low powered / battery enhancement products.

Stock

1 month ago | Report Abuse

We view the recent sell off of Dagang Nexchange ("DNeX") share unwarranted, given the ability of its 5 year LTA with China and Taiwan Display Driver IC fabless companies Chipone Technology and Ilitek to cushion the impact of any potential decline in IC demand.

Note that the LTA makes up of 70% of SilTerra's current wafer capacity and guarantees a load or pay, thus SilTerra will benefit regardless of whether the economy falls into a recession in the 1H23.

Separately, Nordic Semiconductor (key Bluetooth supplier of tech giant A), the world's leading Bluetooth wireless IC drive has locked SilTerra's loading for next 1H23 (In line with the expansion of SilTerra's 20% additional capacity).

While shares in global chip giants falter, SilTerra remains in a good position by virtue of it being the a handful of 200mm fab in the world having the capabilities to fabricate Silicon Photonics and MEMS IC (with various patents) having invested years in R&D with IMEC.

ASP for 200mm remains elevated due to shortage for automobile and data centre IC chips, two areas of focus for SilTerra's near future loading.

As for Ping Petroleum, oil prices remains elevated and undersupplied, despite prices falling from US$100 highs, Ping Petroleum's average actual cost per barrel is only US$25/bbl. At current prices of US$87/bbl, Ping is still able to make significant profits.

Under the guidanceship of Tan Sri Syed Zainal Abidin Tahir, DNeX is able to weather the potential economic downturn and continue to record profits due to the LTA.

We believe that the market has underappreciated the positive impact of the LTA signed by DNeX and will be positively surprised when DNeX's quarter earnings is announced.

Stock

2022-02-15 11:30 | Report Abuse

Note that all 3 of Success Transformers products has been receiving myriads of orders in recent months.

This is due to:
1. The replenishment exercise by major Municipals due to damages to street lights.
2. Air purifier product being sold like hot cake since end of last year.
3. Potential moving into EV segment via electric charging of batteries

At RM0.755 per share, the company is highly undervalued.

Expect Q4 results to show significant improvement due to factors 1 & 2 above.

Share price is expected to further propel once factor 3 is finalized.

Stock

2022-02-15 11:26 | Report Abuse

Note that SMIC had announced a leap in earnings growth few days back.

The main contributors were due to ASP hike in 200mm/8 inch wafer chips.

Based on channel checks, SilTerra's GaN and Silicon Photonics that are patented are receiving myriads of orders up from 1.5 years ahead due to its technological superiority and years of investment in R&D by SilTerra.

Expect DNeX's share price to continue to rise to reflect full value of SilTerra and Ping Petroleum.

Most foreign institutional investors had taken notice and began to purchase DNeX shares since last month.

On a channel check, an American fund has prescribed an intrinsic value based on SOTP DCF of RM5 / share based on beginning 2025 valuation, factoring in the highly valuable GaN, Silicon Photonics and MEMS.

Stock

2022-01-25 09:38 | Report Abuse

Note that DNeX will not require further material fund raising exercise as they have more than RM700mil in cash and bank balances as at December 2021.

The price action today is merely a panic selloff after a major dip in US indices (before recovery) yesterday.

Note that DNeX's expansion is to cater for high technology and high demand wafer chips built on 200mm wafers, including the revolutionary 180nm BCD Automotive Grade 0 chip that will be used in Foxconn's EV.

Based on trade statistics, during the second half session yesterday were local and foreign institutional investors while net sellers remained retailers.

Stock

2022-01-24 14:11 | Report Abuse

Note that Foxconn completed a deal with Indonesian Battery Corporation, together with PT Indika Energy and Taiwanese electric bike company - Gogoro to jointly develop battery manufacturing and electrical vehicle ecosystem in the country.

Late last year, Foxconn made its mark into Thailand with a partnership with Thai giants PTT to explore EV opportunities in the country.

This coincided with the time of completion of SilTerra's 180nm BCD Automotive grade 0 wafer chip that is used in Electric Vehicles.

In Tan Sri Syed Zainal's interview earlier this year, he mentioned that there is additional land and capacity in SilTerra's Kulim manufacturing plant and DNeX had initiated discussions with Foxconn and CGP.

Since then, Dr Albert SK Pang (formerly of Shanghai Huali) had been appointed as officer in charge of SilTerra.

It is not known to many that Shanghai Huali is an affiliate of German-Chinese electric car manufacturer - Byton.

With so many public leads, it is obvious that DNeX (by virtue of its direct interest in SilTerra)'s share price can continue to further run up, with several foreign investment analysts estimate being even higher than RM1.5/share.

Stock

2022-01-12 12:37 | Report Abuse

Dear David,

Remainder comprise of:
1. Small foreign net sell of RM2.3mil
2. Short selling value

Note that 99% of value on short selling comprise of sell only position, as during the period of Jan 3 - 7, 99% of short selling position was outstanding.

Simply put, you can expect them to “buyback” DNeX shares this week to cover their short position if DNeX’s price runs further this week.

Stock

2022-01-12 12:20 | Report Abuse

Dear Beginner,

Data is specific to DNeX.

Thank you.

Stock

2022-01-12 12:06 | Report Abuse

Updates on DNeX price:

- Price is consolidating at RM0.86 range post staging a strong technical recovery from RM0.83 the day prior.
- Volume traded on first trading half is low, being 15% of average total traded volume for the past 7 trading days.
- Main buyers for the past week was Local Institutional Investors, with a total net buy of RM114.4mil for the week from Jan 3 - 7.
- Main sellers for the past week was Local Retail Investors, with a total net sell of RM74.8mil for the week from Jan 3 - 7.
- Local Institutional Investors are playing a wait and see approach in view of strong accumulation with a volume weighted average price of RM0.847 for the past 7 trading days.
- Uptrend is expected to continue thereafter, with the first potential to test price at RM1.08, and RM1.5 thereafter.

Stock

2022-01-10 12:58 | Report Abuse

After a week of surge, DNeX's share price began to test its resistance at RM0.89. Facing this price resistance, the price begain to consolidate at a RM0.86 - RM0.87.

With DNeX poisted to announce Q2FY22 by middle to end of Febuary, it is projected to announce higher earnings due to:

i. Increase in SilTerra's ASP of Wafer per Mask Layer by 25% since Q2 FY21 and Wafer Fabout performance due to significantly lesser wastage

ii. Increase in crude oils lifting offtake value of Ping Petroleum

iii. Recognition of NSW revenue

The effects of which are projected to be a PATMI of RM59mil.

Based on annualised PER of 25x (Blended technology and energy), the fair value of DNeX is RM1.87

Based on annualised PER of 30x (Blended technology and energy, factoring in positive sentiment), the fair value of DNeX is RM2.25

Note that further catalyst that can boost the price to even higher levels include:

i. Deal with Foxconn on major expansion of Kulim plant for another foundry using MEMS, GaN and SiPhi for Electric Vehicles chips

ii. Deal to acquire MIMOS' 5k 8 inch foundry

Benchmarking SilTerra with peers under the GaN, MEMS and SiPhi technology, its value is significantly undervalued with peers currently being valued at 4x higher than SilTerra's current composition to DNeX.

Premised on the above, DNeX share price certainly has has further legs to run.

Stock

2022-01-06 16:30 | Report Abuse

Success' main business comprise of:

i. Manufacturing and selling of transfomers to municipal and governments (Malaysia, China, Australia, Singapore, Kenya)

ii. Manufacturing and selling of smart lighting ("ILCS") to municipal and governments

iii. Manufacturing and Fabrication of metal/steel/aluminium for smart lighting via its subsidiary Omega Steel Industries

iv. Portable air purifier (Kare4u) using Korean technology approved by FDA

The company is highly undervalued in terms of financials, as net cash of the company (including short term investments) are valued at RM0.55/share

The company's net assets or equity value is RM1.47 per share with zero borrowings.

The company's products are highly scalable into smart technologies in Electric Vehicles and Solar.

Based on Nov21 chart, the share price experienced a sell off post ex-dividend date and reporting of Q1 financials.

However, the company is widely expected to report better financials in FY22 as economies open up and municipal and governments replace conventional lighting with smart lighting with monitoring and sensor system.

Note that the company's intangible value is that they fabricate their own products, thus not being adversely affected in the purchase supply chain.

Further catalyst is the company's recently launched business on Korean air purifier approved by FDA. This product has been selling like hot cakes in recent months as the economy gradually opens up with the need for greater hygienic level.

During the recently concluded AGM, management did not rule out any business opportunities / collaboration in the EV industry.

At current price of RM0.795, the company is definitely worht a relook.

Stock

2022-01-05 10:56 | Report Abuse

DNeX's main business units comprise of:

i. SilTerra

ii. Ping Petroleum

iii. Trade facilitation ("National Single Window")

iv. Subsea Cable installation

In its recently announced quarterly financial results, core PATAMI was recorded at RM41.3mil.

Based on that core PATAMI, SilTerra's PATAMI contribution was only 2 months (RM21mil). This was due to the acquisition being completed in July 2021.

During that period, average ASP for Wafer per mask layers were USD20.8. Based on channel checks, Wafer per mask layers ASP had increased by 25% and is expected to continue to surge going into 2022.

Based on 25% increase in ASP, SilTerra is expected to record RM39mil - RM40mil in core PATAMI for Q222.

Assuming profitability of Ping Petroleum and other businesses remains constant (Although it is expected to rise), DNeX is expected to record a profit of RM59mil - RM60mil in Q222 (3 months).

Using a blended PE of 25 (Technology + Oil and gas sector), DNeX's value should be RM1.87 (Based on annualised profit of RM59mil)

Using a blended PE of 30 (Technology + Oil and gas sector), factoring in recovery of crude price, DNeX's value should be RM2.25 (Based on annualised profit of RM59mil)

At current price of RM0.845, DNeX is significantly undervalued.

Stock

2021-12-07 08:22 | Report Abuse

Appointment of the two new directors are to further enhance the board knowledge on accounting and legal.

DNex's prospects remains in tact with Silterra ASP rising month on month.

Stock

2021-12-06 10:26 | Report Abuse

UnclePho's comments all red flagged. What happened?

Stock

2021-11-30 11:25 | Report Abuse

MediaTek is the top fabless company in Taiwan and top 5 in the world.

Stock

2021-11-30 11:24 | Report Abuse

Note that ILI Technology Corp is a wholly owned subsidiary of MStar Technologies, which in turn is a wholly owned subsidiary of MediaTek.

This deal with ILI Technology Corp is expected to boost SilTerra's earnings quite substantially.

Also in the cards are discussion with Foxconn and CGP on a new 300mm facility to permanently boost SilTerra's capacity.

The new plant is expected to be fully loaded for EV productions.

Stock

2021-11-26 13:38 | Report Abuse

Unfortunately, there are some sourgrapes here that missed out on DNeX that keep bad mouthing.

Sad to see them only typing here everyday while others laughing to the bank.

Stock

2021-11-26 13:30 | Report Abuse

Correction: Silterra acquisition was completed in end July.

Thus RM22mil is only August and Sep21 contribution.

This means that full 3 months should be RM33mil.

At PE of 45x, Silterra worth to Dnex alone is RM1.88.

Stock

2021-11-26 13:26 | Report Abuse

Noted that SilTerra contributed RM22mil profit this quarter, assuming full year of RM88mil, at technology index PE of 45x, Silterra alone to Dnex is worth RM1.26.

This is excluding effects of ASP price hike in future from severe chip shortage.

Stock

2021-10-25 09:43 | Report Abuse

As shared during the weekend session on the topic Global Chip Crunch, many leading industry experts had mentioned that chip prices for 200mm wafers had soared more than 40%-100%.

DNeX is poised to record a record breaking revenue and profit from SilTerra (expected to double in revenue and record a record breaking profit).

Further catalyst is collaboration on supply deal with Foxconn on EV.

Stock

2021-10-22 10:53 | Report Abuse

Note that SilTerra's 180nm Bipolar CMOS-DMOS ("BCD") automotive grade 0 technology chip was announced on 26 August 2021 (First BCD chip in the world to be grade 0)

Also, this chip has entered mass production since September 2021.

Foxconn's EV announcement was then on 18 October 2021.

Coincidence? or not?

You be the judge.

Stock

2021-10-21 16:25 | Report Abuse

Based on verified sources, DNeX is in advanced talks with Foxconn on multi year wafer supply deal for Foxconn's EV manufacturing.

The deal involves multi year supply of SilTerra's latest 180nm BCD automotive Grade 0 chip.

This deal is expected to be a bumper deal for SilTerra as it will leapfrog its revenue by double due to worldwide chip shortage.

Stock

2021-09-28 20:37 | Report Abuse

There are some less credible comments made above to clarify:

Comment 1 - "400mm is Taiwan Standard, maybe 800mm now"

Fact 1 - "TSMC is in early stages of exploration and research of 400mm wafer. The major roadblock for 400mm wafer chips is that the development of 400mm wafer requires costs that are so significant that, at the moment, even if mass produced, cannot be recovered at a profit.

In layman terms,
Cost to develop and mass produce a 400mm wafer chip for iPhone = US$10,000 per fragment wafer
Revenue earned from selling a wafer chip to iPhone = US$500 per fragment wafer

Thus, 400mm wafer chip is still light years away"

Comment 2 - "200mm wafer is useless"

Fact 2 - "200mm is the most used semiconductor chip in EV. It is also the main reason for the global chip shortage. While 300mm wafer chip is widely used in phones, it is less used for EVs"

Stock

2021-09-28 18:07 | Report Abuse

Note that under the terms of the Sale and Purchase Agreement ("SPA") between Khazanah and DNeX, that Khazanah had cleared all Accumulated Losses in DNeX via forgiving the convertible loans that SilTerra owes Khazanah.

The convertible loan forgiven (Share capital) has been capitalised and offsetted against the accumulated losses.

Fact: As such, DNeX will not be consolidating SilTerra's historical accumulated losses as it has been offsetted by the recapitalisation of the forgiven debt/convertible loan notes.

Please read the SPA disclosed by DNeX to Bursa clearly.

Stock

2021-09-28 14:04 | Report Abuse

Note that Foxconn and PTT are in advanced negotiation stages on the production/manufacturing of EV's.

Foxconn's head honcho had mentioned in an interview to Taiwan reporters that they will be tapping into SilTerra and Macronix on the supply of 8 inch wafers, which is semiconductor chips mainly used in EV.

Stock

2021-09-28 14:01 | Report Abuse

Key points from DNeX's recently announced results + future prospects:

i. Key points from Q4 results announcement:
- Based on the Purchase Price Allocation exercise performed on 60%-Ping acquisition, DNeX's consolidated 90%-share of the effects on business combination is RM273mil. This can be simply interpreted as the excess of fair values of Ping's inventories (oil) and assets (oil rig's and oil rights) over the price paid for the 60% stake.
- SilTerra's results is not consolidated yet as the acquisition is deemed completed only in July 2021 (refer announcement to Bursa).

Questions many may ask:
- The effects of business combination is only accounting, not real cash. Why is it good?

Answer:
- While yes, the effects of business combination is only accounting, but it also means that Ping will be realising these oil inventories in the next few quarters at a higher fair value. Realising these oil inventories at higher value also means higher profit contribution from Ping to DNeX.

Note that the valuation of fair value of Ping's oil inventories are done by professional accountants/experts. In valuing these oil inventories, the factor considered is the net realizable value, which is the price Ping is able to fetch if they sold the oil inventories.

So the answer is - Yes this latest quarter result is good, because it proved to investors that Ping will be able to sell oil inventories at a higher price in the next few quarters, which translates to higher Profit.

Stock

2021-09-17 14:31 | Report Abuse

Based on 8 inch silicon grade wafer price of US4,500 per wafer above, SilTerra is capable/expected to rake in revenue of:

40,000 wafers per month x US4,500 = US180mil per month or US2.16bil per annum

Assuming a 20% net profit margin = US432mil or RM1.7bil net profit

Factored for DNeX's share of 60% = RM1bil net profit per annum

At PE of 15, SilTerra's value to DNeX alone is RM4.85 per share

Stock

2021-09-17 14:27 | Report Abuse

Premium rush for 8 inch wafers | 17 Sep 2021 0900 GMT +8

Silicon Today noted that prices for 8 inch wafers had once again increased by 20% due to a "Premium Rush" in the Electric Vehicles ("EV") market coupled with acute shortage for all other devices, particularly household and industrial electronics. This situation is exacerbated by lockdowns in Asia resulting in order to receive time had increased by a further two months.

Based on channel check, an 8 inch silicon grade wafer price had risen to US4,500 per wafer. The situation is expected to be worse in the coming months, and going into 2022.

News & Blogs

2021-09-03 14:07 | Report Abuse

Second hearsay statement made by another user above - "Assume can achieve profit margin 30% is overly optimistic"

Facts - Fortunately, there are global monthly IC analysis reports that analyses CMOS & DMOS IC chips by specs so that users are able to make a highly calculated analysis

News & Blogs

2021-09-03 14:05 | Report Abuse

To debunk some hearsay above with facts:

First statement made by user above - "Assume only Dnex will get the business. How many companies like Silterra in the world or let say Asia"

Facts - Fortunately, SilTerra is indeed the only wafer fab:
1. In the world that has BCP-CMOS-DMOS Grade 0 (Meaning chip is able to withstand temperatures up to -150C)
2. It is also the only company in the world to begin mass produce this chip
3. It is also the only company in the world to IP this IC chip
4. It is also the only company in the world that has both Foxconn as its shareholder + Beijing CGP as a major shareholder of its subsidiary
5. It is also the only company in the world that is able to secure long term supply contract with Chipone
6. It is also the only company closest proximity to Foxconn's EV plans in Thailand that has local presence + automotive grade 0 IC chips

Note that most major fabs in Asia had capacity already maxed out for Smartphone and other devices, whilst Silterra with RM200m equipment upgrade is able to increase its capacity by 10-15% without incurring large capex cost (Also the only one in Asia, the rest need 2 years for ramp up)

Stock

2021-09-02 10:26 | Report Abuse

Facts:

- SilTerra is the first in the world to produce 180nm Bipolar-CMOS-DMOS (“BCD”) automotive grade process technology that is Grade 0.
- Even TSMC's highest technology for 8 inch BCD technology is only Grade 1.
- Even TSMC's 8 inch BCD technology that meets Grade 1 is non-automotive IC Chip
- Given Foxconn's ambitions in EV, to create competitive advantage, there is a high chance they will use SilTerra's BCD automotive IC chips (More powerful IC chip + already have a 3% stake in DNeX)

Stock

2021-09-01 09:57 | Report Abuse

SilTerra recently announced it has entered mass production for it's 180nm Bipolar-CMOS-DMOS ("BCD") automotive grade process technology.

This smart technology IC chip is the first in the world to be a 180nm 8 inch Grade 0 process.

Note that TSMC's 90nm 8 inch is only expected to pass qualification (Not automotive like SilTerra)

https://www.tsmc.com/english/dedicatedFoundry/technology/specialty/bcd

With global adoption of electric vehicles, SilTerra new mass production IC chip is in enormous demand.

Benchmarking with global IC companies selling 8 inch Bipolar-CMOS-DMOS IC chips, a single wafer for the Bipolar-CMOS-DMOS IC could fetch at minimum USD24k per wafer.

Assuming just 30% existing capacity is used for this technology, revenue could fetch at minimum RM1.3bil (30% capacity for Bipolar-CMOS-DMOS), with profit margin of 30% RM400mil.

In addition to that, load to Chipone making up the remaining 70% at revenue of RM1bil with profit margin of 8% of RM80mil

At minimum, net profit could fetch RM480mil, at PE of 38 (Benchmarked to Inari), SilTerra's value to DNeX alone should beRM3.5 (Not including Ping Petroleum)

Stock

2021-08-24 06:56 | Report Abuse

DNeX's SilTerra will benefit tremendously from the chip shortage experienced globally.

SilTerra has been operating at 91% since the beginning of the year.

Expansion of 10% is in the works after pumping in capital for upgrading wafer machineries.

Based on back of the envelope calculation, DNeX is expected to make a healthy PATAMI of RM150mil-RM200mil on RM1.3bil-Rm1.5bil revenue for FY21, mainly contributed by significant improvement in financial performance from SilTerra and Ping Petroleum.

Stock

2021-08-17 10:18 | Report Abuse

SilTerra's wafer blended average selling price has risen by more than 200% compared to same period last year.

Even if the cost cutting measures do not occur this year, profit is expected to jump to more than RM250mil - RM400mil.

FYI:
- SilTerra is running at more than 90% capacity since March 2021
- Cost cutting measures by selling directly to China and Foxconn will begin to reduce their costs

Stock

2021-08-11 09:39 | Report Abuse

3. "Private placement one short done and over" - The difference between a good management and a bad management?
Good management raise cash to acquire quality assets, then turn them into cash generating assets before asking for more money.

Stock

2021-08-11 09:32 | Report Abuse

Answer to some queries above:

1. "Despite the selling, price didn't go down drastically" - Yes, and this is because of the warrant disposal absorption mechanism by institutional investors and forengn investors

2. "Whether CIMB fund flow report indicates who are the buyers and sellers" - The type of institution (example: sovereign, proprietary, etc) is indicated.

Stock

2021-08-10 19:12 | Report Abuse

Further rumours debunked:
3. Private placement of 30% will dilute share price significantly (Fact: Management has said that the 30% private placement is on a need basis and is it in batches)
4. Oil & gas industry is sunset industry
(Fact:
a. Achieving net zero emission and commendable ESG score is key for investors to assess. The remaining players in the industry has already been building carbon dioxide capture storage facilities that can be stored for decades for the oil & gas industry to achieve net zero objective.
b. China only expect local oil demand to surge until 2026 before beginning net zero objective, to achieve net zero only by 2060, which is 10 years later than the EU
c. The EU, expected to be the first coalition to achieve net zero by 2050, still expects fossil fuel to command 50% of total energy share by 2050).

Stock

2021-08-10 19:03 | Report Abuse

Rumours debunked:
1. Warrants conversion will keep diluting share price (Fact: 98% of warrants has already been converted and is already traded in the market)
2. Rights issue (Fact: Dnex has large net cash even after paying for acquisition of SilTerra and Ping via cash from warrant conversion. Immediate cash outflow from 50% of Avalon is small (US$5mil).


Facts:
1. Foreigners were largest net buyers of Dnex despite being the major net seller for the whole bourse. (Source: CGS-CIMB fund flow report)
2. Institutional shareholders continue to be net buyers of Dnex for last week. (Source: CGS-CIMB fund flow report)
3. Retailers continue to be net sellers of Dnex after converting warrants to sell immediately desperately. (Source: CGS-CIMB fund flow report)

Stock

2021-07-26 08:19 | Report Abuse

DNeX is not a penny stock by virtue of its market capitalization of RM2.2bil.

Share price depends on myriad of factors, but what is factual is that for the past 2 weeks, the net buyers of DNeX were Institutional Investors and Proprietary Funds while net sellers were retailers, based on CGS-CIMB fund flow report.

Stock

2021-07-26 07:23 | Report Abuse

Noticed IMEC mentioned that - “We believe silicon is the perfect platform.”

and there is only one company on planet earth that possess and own the technology for application of Silicon Photonics by Optical Waveguides, which is Silterra.

Stock

2021-07-26 07:20 | Report Abuse

Moore’s Law, which holds that the number of components on a silicon chip will double every two years, “is by no means slowing down,” albeit the means of achieving it will change to combine innovations such as new designs and types of transistors. That’s as well as continuing to go smaller: “we will go sub-one nanometer,” he said.

Van den hove sounded upbeat on the potential for the industry beyond existing areas. Chip technology could improve food production and monitoring, for example, he said. Then there are applications in life sciences which will create “an enormous boom,” in five years. “By combining some of these leading edge technologies you can do phenomenal new things,” he said.

That’s even in the face of growing geopolitical headwinds.

“Many things are happening in the world at this moment, but I think it’s very important that we remain calm,” said Van den hove. “The opportunities are so big.”

Stock

2021-07-26 07:20 | Report Abuse

“But this is not the first case, we’ve had other cases with other people where they don’t behave according to our code of conduct and our values,” he said, adding that incidents are not confined to citizens of any one country.

Governments, too, are operating in an atmosphere of heightened sensitivity over technology.

The U.K. is now undertaking a national security review of the takeover of Britain’s biggest chip plant by Chinese-owned Nexperia NV. The Dutch government has yet to grant an export license to ASML to ship one of its most advanced machines to China, and the U.S. has made clear it favors the technology remaining in the Netherlands.

The Biden administration is likely focusing on imec in discussions with the European Union about broadening the U.S. alliance in the tech standoff with China, said Martijn Rasser, director of the technology and national security program at the Center for a New American Security in Washington.

“I would be stunned if they’re not,” said Rasser, who formerly worked on technology and innovation at the Central Intelligence Agency. “Imec is really a unique facility.”

The U.S. State Department had no immediate comment when asked about contacts with imec.

Asked if the Biden administration has reached out, Van den hove said there were “many discussions going on, on many of these topics,” but declined to say with whom. Imec, he added, is keen to “contribute in a positive way to progressing our industry, and so whatever we can do to support that, we will entertain those discussions.”
One area of future focus is the field of compound semiconductors. China is piling funding into developing what it calls third-generation chips, fabricated from compound materials such as gallium nitride, in an attempt to establish a lead without being dependent on U.S. silicon-based technology. Van den hove is skeptical the field will ever be more than a niche market for certain applications rather than a replacement for silicon.

“I don’t think standalone compound semiconductors is a huge market,” he said. “We believe silicon is the perfect platform.”

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2021-07-26 07:19 | Report Abuse

Today, imec participates in a scholarship program to fund post-doc researchers from China and, according to local media reports, in February became a member of the Wuxi municipal semiconductor industry association in Jiangsu province, a key chip-production area. But its presence in China is less than five people, and it doesn’t do any R&D there, according to Van den hove.

“The situation three or four years ago when that happened was very different from the situation today,” Van den hove said of the Li visit, when asked about the insertion of politics into the industry.

He added imec adheres strictly to export regulations, including those imposed by Washington, and insisted imec’s research capacity hasn’t been harmed by the political strains. “But we also have to be realistic and face the facts that these geopolitical tensions at this moment are increasing.”

Imec was founded in 1984 by the regional government of Flanders, and now has about 4,500 staff including research students. Some 75% of funding comes from its partners among the main chipmaking giants, from Intel Corp. and Taiwan Semiconductor Manufacturing Co. to Samsung Electronics Co. and Applied Materials Inc.

It has enjoyed a key relationship over the past thirty years with ASML, using the company’s lithography machines to become the leading research hub for what’s known as scaling: making chips with ever-smaller and more powerful features. Its facilities include a 2.5 billion-euro ($3 billion) “pilot line,” that allows researchers to work on chipmaking processes that are typically two-to-three generations ahead of the current leading-edge manufacturing. So whereas the most advanced chips in the world are measured at 5 nanometers, or billionths of a meter, imec is already working on 2nm and below.

Germany’s Fraunhofer institutes and CEA-Leti of France also conduct chip research in Europe, while TSMC cites the Semiconductor Research Corporation of the U.S. as a partner alongside imec. But the scope of the latter’s research is regarded as giving it a lead.

“Europe has two jewels,” Intel CEO Pat Gelsinger said in an interview in May. “One is ASML, the most advanced lithography, and the other is imec, the most advanced semiconductor research in the world.”


That work also makes it a target of industrial theft. Flemish newspaper De Tijd reported in 2018 that a Chinese researcher at imec was deported by Belgian authorities on suspicion of espionage. Van den hove confirmed the report, although he said the events occurred some time before then.

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2021-07-26 07:18 | Report Abuse

By Alan Crawford (Bloomberg)
July 13, 2021, 12:00 PM GMT+8 Updated on July 14, 2021, 3:08 AM GMT+8

The historic Belgian city of Leuven is known for its centuries-old university and as the headquarters of brewing giant Anheuser-Busch InBev NV. Less so as the location of a semiconductor research organization that is now the center of both political and industry attention.

The Interuniversity Microelectronics Centre, or imec, may be Belgium’s best-kept secret, but it’s in global demand for its work on the future of computer chips, with applications in areas from genome sequencing to autonomous driving.

It’s also increasingly in the sights of governments as chips become political weapons in the U.S.-China tech conflict. Crippling industry shortages during the pandemic have meanwhile set off a scramble for access to advanced research as the U.S., China, Japan and Europe all seek greater self-reliance in semiconductor production.

The European Commission is consulting with imec on its plans to build out the continent’s chip capacity. A South Korean ministerial delegation visited this month. It was name-checked in last month’s White House review of the U.S. supply chain alongside ASML NV of the Netherlands, which has a virtual monopoly on the machines needed to make the most advanced chips. In the words of one Washington observer, imec is one of those places very few people know about but which everyone should.

“We have never been so much in the spotlight as today,” Chief Executive Officer Luc Van den hove said in an interview in his office on the 15th floor of the futuristic imec tower, with 360 degree views of countryside just outside the historic town center. “We have received much more attention than ever before from the politicians: local politicians, European politicians, U.S. politicians.”

Chinese politicians, too. Premier Li Keqiang visited in October 2018 — before tensions over trade with the Trump administration expanded to chips — and stressed the “vast business opportunities” of working with “the world’s largest market,” according to an account of the visit posted on the Chinese government’s website.

Imec had previously joined with Huawei Technologies and Qualcomm Inc. to help China’s biggest chipmaker, SMIC, set up an R&D company. But within eight months of Li’s visit the U.S. Commerce Department added Huawei to its entity list and a cascade of export controls ensued, targeting China’s access to U.S. chip technology.

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2021-07-26 07:10 | Report Abuse

They do not need to incur significant capex cost in the near term as process nodes manufactured (180nm and 130nm) orders are surging worldwide.

One thing most people do not understand is Silterra's 180nm and 130nm process nodes are still very relevant in today's market (even more so for Electric vehicles, Data centres and 5G deployment).

Why? because wafer on 180nm process nodes are matured and proven technology. Even TSMC still produces 180nm process node wafers.

Incremental maintenance cost will only be incurred if the wafer machines breakdown. Even so, there is insurance coverage. Otherwise, there is always scheduled downtime for maintenance (non incremental, planned maintenance).

Also, PMUT on CMOS and Silicon photonics on optical waveguides is the company's patented technology.

If you are in the industry, you will know that IMEC was the one that approached Silterra to build and patent this technology in 2017 (as they foresaw a surge in applications for data centre in near future).

Now the silicon photonics on optical waveguides adoption has surged due to its benefits in saving energy cost by 15-20% in data centres compared to normal silicon photonics not on optical waveguides (that are developed by many large conglomerates).

Imagine, this company is the only one in the world that can produce silicon photonics on optical waveguides that is experiencing and will further experience burst in orders from major 5G players and data centre players.

It is only a matter of time DNeX breaches the RM10bil market capitalization (or even higher, when more people begin to understand how powerful Silterra is).

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2021-07-24 14:27 | Report Abuse

Based on SMIC's quarter 1 results will show that SMIC's 200mm wafer fab revenue increase by ~29% from Q420 to Q121 (almost entire increase due to increase in ASP instead of capacity, as SMIC's capacity has maxed out at 98% based on the disclosure). Note that SMIC's revenue are entirely 200mm wafer

Back to Silterra, at 64% capacity for 2020, Silterra achieved RM568mil revenue for 2020.

A simple back on the envelope calculation:
RM568mil / 64% x 92% (Current Silterra capacity) = RM816.5mil

Assuming 75% of Silterra's 200mm wafers had 20% ASP increase (conservative compared to SMIC):
(RM816.5mil x 75% x 1.2) + (RM816.5 x 25% x 1.0)
= RM939mil (Silterra 2021 conservative revenue)

How about profitability?
Note that Silterra is and has been EBITDA positive, which means that they are generating positive cash flows.
So why Profit after tax is negative? This is due to RM100mil depreciation per year.
However, after Silterra is acquired by DNeX, the useful lives of the assets of RM100mil book value will be re-measured (as machines for 200mm wafer fab have increased useful lives due to current market shortage)

Thus, depreciation will fall to RM10mil per year (based on RM100mil book value of assets)

Based on reduced depreciation, ASP and capacity increase, Silterra can easily turn the 2020's loss of RM64mil into profit of more than RM300mil from:

- Revenue increase by more than RM350mil
- Depreciation fall by more than RM80mil

In conclusion, Silterra's simple and conservative back of envelope calculation shows it could easily make RM150mil - RM250mil profit after tax this year.

Based on DNeX's 60% stake in Silterra, at 60x PE (Semiconductor), Silterra's value alone to DNeX is RM2.32

RM200mil (PAT) / 3.1bil shares (fully diluted) = RM0.039 (EPS)

60 PE x RM0.039 (EPS) = RM2.32

This is only current year earnings, not including Silterra's future growth prospects in MEMS and Silicon Photonics in Electric vehicles and Data centres.

This is the reason foreign investment banks and proprietary investment funds have been buying so confidently from retailers.