KUALA LUMPUR: Maybank Investment Bank Research expects 2017 will be an interesting year especially for the smartphone supply chain, with Apple’s next iPhone launch in September 2017 potentially packing a punch for its 10th year anniversary.It said on Thursday that alongside growth in infrastructure spending (i.e. data centers) to support tomorrow’s advancement in technology applications, these will translate to demand/visibility for the semiconductor segment.“Also, persistent strength in US dollar beyond our base assumption of USD1/MYR4.15 should also boost net exporters’ earnings.“Nonetheless, we remain Neutral on the sector as valuation is fair at 15 times 2017 PER for expected earnings growth of 30%. Inari is our only Buy pick,” it said.Maybank Research expects Malaysian technology names like Inari and Globetronics which involved in those segments to resume their double-digit earnings growth in 2017.“For now, we prefer Inari for its (i) consistent job wins from Broadcom and (ii) new forays which could boost near-term earnings.“While we are currently neutral on ViTrox, its transition to the new Campus 2.0 in 2H17 could be a re-rating catalyst as constraints on capacity are lifted.“As for Globetronics, while we believe that earnings recovery would likely happen in 2H17, the stock remains a Sell on pricey valuations (20 times CY17 PER) despite a 116% on-year jump in 2017E earnings,” it said.
Source:   The Star
January 12, 2017 01:08 UTC