Semiconductors end year on a high
KUCHING: The semiconductor sector has ended the year 2016 on a high on the back of a recovery in the second half.
The research arm of TA Securities Holdings Bhd ( TA Research) observed that worldwide semiconductor sales beat expectations and achieved a record year in 2016, reaching US$ 338.9 billion in 2016.
Sales in the fourth quarter of 2016 (4Q16) went up 5.4 per cent quarter on quarter (q- o- q) and 12.3 per cent year on year ( y- o-y).
The sector’s recent streak continued in December 2016, it said, as it recorded its fifth consecutive y- o-y growth of 12.3 per cent y- o-y.
The research arm further noted that year to date ( YTD) growth was led by sensors and actuators which was up 22.7 per cent y- o-y.
“Advances were also seen in NAND flash memory (up 11 per cent y- o-y), digital signal processors (up 12.5 per cent y- oy), diodes (up 8.7 per cent y- o-y), small signal transistors (up 7.3 per cent y- o-y) and analog (up 5.8 per cent y- o-y),” TA Research said in a sector update.
The research arm added that building on its momentum, World Semiconductor Trade Statistics ( WSTS) expects the industry to achieve a solid growth of 3.3 per cent y- o-y in 2017.
TA Research highlighted that annually, growth was led by China (up 9.2 per cent y- o-y) and Japan (up 3.8 per cent y- o-y).
“Declines were seen in Asia Pacific/All Other (down 1.7 per cent y- o-y), Europe (down 4.5 per cent y- o-y) and Americas (down 4.7 per cent y- o-y).
“However, for the month of December, all regions recorded positive y- o-y growth.
“Europe reported its first positive y- o-y growth (up 1.3 per cent y- o-y) in 24 quarters,” the research arm said.
On the book-to- bill ratio, TA Research noted that it returned above parity at 1.06- fold.
The research arm further noted that both bookings and billings were very strong in December, up 47.8 per cent y- o-y and 38.2 per cent y- o-y respectively.
“Bookings for the year increased 10.1 per cent y- o-y to US$ 19.1 billion,” it said.
Al l i n, TA Re s e a r ch remained ‘overweight’ on the semiconductor sector.
With Malaysian Paci f ic Industries Bhd reporting a good set of results in its 4Q16, TA Research expected Unisem ( M) Bhd and Inari Amertron Bhd to follow suit.
“This, we believe, will be suppor ted by the weaker ringgit and demand for a major smartphone model,” the research arm said.