Recent AI Spotlight saw UMS & AEM Average 8.5% Gains on the Week

The Technology Sector comprises 22% of the FTSE All-World Index and 55% of the FTSE Taiwan RIC Capped Index, and has been a key driver of the Indices respective YTD SGD price gains of 9% and 17%.  During this time, the Semiconductor Industry has contended with an inventory correction that began in 2H22, while persistent inflation and decelerating growth have reduced consumer electronics demand.

Recently, semiconductor companies have been increasingly contrasting the 2023 overcapacity and chip glut with the potential demand for semiconductors and semiconductor services spurred by Artificial Intelligence (“AI”) applications in 2024 and 2025.

Deloitte maintain that Generative AI has “diverse applications across all industries, ranging from market research and note-taking, to enhancing customer support interactions” and that “specific use cases have been identified in various sectors, such as personalised financial planning for wealth management, medical diagnosis in healthcare, creating immersive worlds and experiences in media and entertainment, and outfit curation for retailers”.

Gartner noted in April that the “memory industry is dealing with overcapacity and excess inventory, which will continue to put significant pressure on average selling prices in 2023” with “the memory market projected to total $92.3 billion, a decline of 35.5% in 2023, however, it is on pace to rebound in 2024 with a 70% increase”.

As of 28 April, Nvidia $NVIDIA Corp(NVDA)$ was the fourth largest weight of the FTSE All-World Index and Taiwan Semiconductor Manufacturing Company $Taiwan Semiconductor Manufacturing(TSM)$ was the largest weight of the FTSE Taiwan RIC Capped Index.

UMS & AEM Average 8.5% Gains on the Week

The 10 most traded stocks of Singapore’s Technology Sector are tabled below.

10 Most Traded Technology Stocks in 2023 YTD

Code

Mkt Cap S$M

YTD Avg T/O (S$M)

Week Net Insti Flow S$M

Week Px Chg %

MTD Px Chg %

YTD Net Insti Flow S$M

YTD Px Chg %

YTD TR %

Venture

V03

4,489.2

13.13

-0.3

0.3

-9.3

-65.5

-9.7

-6.9

UMS

558

716.3

7.01

4.3

8.6

3.9

-7.6

-9.3

-7.5

AEM SGD

AWX

1,086.5

5.73

5.6

8.4

3.3

21.5

2.0

3.2

Frencken

E28

360.2

4.72

-6.3

-10.1

-18.8

-6.1

-10.6

-7.4

Nanofilm

MZH

973.6

4.57

-1.2

-0.7

-2.0

6.6

5.8

6.5

IFAST

AIY

1,242.4

1.33

-0.4

-2.3

-8.9

-5.0

-27.9

-27.5

ISDN

I07

202.7

1.05

-0.3

-5.2

-2.1

3.9

5.7

5.7

Aztech Gbl

8AZ

529.2

0.51

-0.8

-0.7

-15.4

-7.5

-17.5

-15.9

TOTM Tech

42F

112.5

0.33

0.0

2.4

1.2

-2.6

-12.5

-12.5

CSE Global

544

207.0

0.20

-0.2

-1.5

-5.6

-0.2

-1.5

2.8

 Total

 

9,919.6

38.6

0.4

 

 

-62.6

 

 

 Average

 

 

 

 

-0.1

-5.4

 

-7.5

-6.0

UMS Holdings and AEM Holdings generated comparatively symmetrical returns of 8.6% and 8.4% last week, with respective net institutional inflow of S$4.3 million and S$5.6 million.

1. $UMS HOLDINGS LIMITED(558.SI)$

UMS Holdings relayed predictions from Industry Association SEMI on 10 May that global fab equipment spending for front-end facilities is expected to decrease 22% YoY to US$76 billion in 2023 (from a record high of US$98 billion in 2022) before rising 21% YoY to US$92 billion in 2024.

In addition, the company reiterated the Semiconductor Industry Association’s acknowledgement that despite the current short-term cyclical downturn, long-term outlook for the semiconductor market remains strong due to the ever-increasing role of chips in powering the critical technologies of today and tomorrow. The company reported Group revenue for 1QFY23 remained relatively stable, easing 5% YoY to S$80.8 million.

2. $AEM HOLDINGS LTD(AWX.SI)$

AEM Holdings highlighted on 11 May that looking beyond 2023, the future of the semiconductor industry has never been more promising stating that “recent excitement over Generative AI, such as ChatGPT, is fueling the demand for AI-focused semiconductor devices to enable these solutions to be delivered to the masses at economically feasible rates”.

AEM Holdings also noted that its inventory levels are reducing, and inventory corrections are expected to conclude in late 2023, early 2024. The company reported 1QFY23 revenue of S$152.7 million, maintaining target guidance of S$500 million for FY23, following record FY22 revenue of S$870.5 million.

https://www.sgx.com/research-education/market-updates/20230529-recent-ai-spotlight-saw-ums-aem-average-85-gains-week

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  • bossbaby
    ·2023-06-04
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