KUALA LUMPUR (May 29): Malaysia is emerging as one of the biggest beneficiaries of global supply chain reconfiguration, with strong foreign direct investment (FDI) inflows and growing interest from multinational corporations diversifying semiconductor exposure away from China, according to Nomura.
In a global markets research note on Friday, the Japanese investment bank and brokerage firm said Malaysia has “the biggest prospects of moving up the value chain”, supported by rising investment flows, particularly from US and European multinationals.
It noted that Johor is rapidly becoming Asean’s largest data centre investment hub, even prior to the development of the Johor-Singapore Special Economic Zone (JS-SEZ).
Against this backdrop, Nomura said property developers with strategic landbanks in Johor, Klang Valley and Penang are among the key beneficiaries, naming Sime Darby Property Bhd (KL:SIMEPROP) and Eco World Development Group Bhd (KL:ECOWLD).
The brokerage said these companies stand to gain as multinational corporations acquire land for factories, data centres and logistics hubs, particularly in the JS-SEZ corridor where industrial land carries a premium.
Separately, Nomura said construction players are also expected to benefit from rising project flows, including Sunway Construction Group Bhd (KL:SUNCON) and Gamuda Bhd (KL:GAMUDA), as demand increases for data centres, logistics facilities and supporting infrastructure such as roads, utilities and worker accommodation.
Nomura added that the industrial expansion is also creating tailwinds for the energy sector, with higher electricity demand from data centres and advanced manufacturing expected to benefit Tenaga Nasional Bhd (KL:TENAGA) and renewable energy players such as Solarvest Holdings Bhd (KL:SLVEST).
It said Malaysian utilities are securing long-term power purchase agreements in key industrial corridors, while renewable energy developers are benefitting from both regulatory support and corporate sustainability commitments.
On the AI cycle, Nomura said near-term earnings momentum is likely to be strongest in markets with direct exposure to AI production, including semiconductors, servers, data centres and related infrastructure, supported by rising AI capital expenditure and supply-chain demand.
It favours ViTrox Corp Bhd (KL:VITROX), noting that the company has the highest artificial intelligence (AI) exposure, with management estimating more than 50% of its current orders are directly and indirectly linked to the AI supply chain.
The brokerage also likes Pentamaster Corp Bhd (KL:PENTA), which is expanding into the advanced packaging supply chain, with more meaningful earnings contribution expected in 2027.