Malaysia

KUALA LUMPUR: Leading innovator in electrical solutions Powerwell Holdings Bhd (PHB) has secured purchase orders totalling RM57.61 million from a renowned multinational technology corporation. The purchase orders, dated May 24, 2024, encompass the supply, installation, and commissioning of low-voltage switchboards and remote power panels for a high-profile data centre project in Selangor. This initiative is set to significantly contribute to PHB’s consolidated earnings and net assets for the financial year ending March 31, 2025 (FY25). This monumental deal, secured by its wholly-owned subsidiary, Powerwell International Sdn Bhd (PISB), underscores PHB’s pivotal role in the rising data centre sector in Malaysia and Southeast Asia. PHB executive director Catherine Wong said this agreement reflects the trust and reliability that major tech players place in the company and positions it at the forefront of Asia’s fast-expanding data centre market. “We are committed to delivering excellence and innovation, ensuring the successful execution of this project within the stipulated timeline,” she said in a statement today. The data centre market in Malaysia is experiencing exponential growth, driven by escalating demands for cloud services and digital transformation across Asia. The country’s strategic location, robust infrastructure, and government support make it an increasingly attractive destination for data centre investments. Recent developments in the region, including substantial investments by global tech giants, reinforce Malaysia’s potential to transform into a leading data centre hub in Asia. The country received RM76 billion (US$16 billion) worth of investments from its data centres between 2021 and March 2023, and its data centre market is expected to attract investments of US$2.25 billion by 2028. Some of the recent developments include the announcement by NVIDIA Corporation at the end of last year to collaborate with a local entity to develop a US$4.3 billion artificial intelligence (AI) cloud and supercomputer infrastructure. Microsoft has recently committed to a US$2.2 billion investment over the next four years, the largest in its 32-year history in Malaysia, focusing on establishing a robust cloud and AI infrastructure to support Malaysia’s digital ecosystem. “These investments by global tech giants enhance the technological landscape in which PHB operates and create a ripple effect of opportunities for local suppliers and service providers in the tech sector. “As Malaysia strides towards becoming an advanced digital economy, PHB is strategically positioned to contribute significantly to this growth, leveraging cutting-edge technology and comprehensive expertise in electrical solutions for data centres,” Wong added.

CYBERJAYA: Dagang NeXchange Berhad (DNeX) has made a strong start in the new financial year, posting a net profit of RM14.5 million for the first quarter ending on 31 March 2024 (1Q FY2024). In 1Q FY2024, DNeX achieved a revenue of RM309.8 million. The Technology segment led the way with RM138.0 million, accounting for 45% of the total revenue. The Energy business followed, contributing RM105.9 million or 34%, while the Information Technology (IT) segment added RM65.9 million, representing 21% of the revenue. The company saw a 9% quarter-on-quarter (QoQ) increase in revenue, rising from RM283.7 million in the previous quarter (6Q FY2023) to RM309.8 million in 1Q FY2024. This growth was primarily driven by higher contributions from the Energy and IT segments. Due to a change in the financial year-end from 30 June to 31 December, there are no comparative figures for the quarter ending 31 March 2024. Breaking down the revenue contributions: Technology Division: Despite a slight decline from RM145.4 million in the previous quarter to RM138.0 million, the division faced lower average selling prices due to product mix, although wafer shipments increased. Energy Division: Revenue grew by 9% QoQ, from RM97.2 million to RM105.9 million, fueled by higher lifting volumes and favorable oil prices, which increased from USD81.9 per barrel to USD87.0 per barrel. IT Segment: Marking a substantial 61% growth in revenue, the segment surged from RM41.1 million to RM65.9 million, primarily due to the completion of progressive work on certain projects. In the Energy segment, DNeX’s immediate priority is the reactivation of the Abu Cluster, located offshore Terengganu, Malaysia, with first oil production targeted for early 2025. The anticipated production volume is 2,500 barrels per day. Ping, a subsidiary of DNeX, operates a geographically diverse late-life oil and gas portfolio, including assets in the UK (Anasuria, Avalon, and Fyne) and Malaysia (Meranti Cluster, A Cluster, and Abu Cluster). In the IT division, DNeX is actively bidding for strategic and large-scale public and private sector IT projects in both domestic and international markets. The company has been operating the National Single Window for Trade Facilitation since 2009 and is optimistic about securing an extension when the current contract is due for renewal in August 2024. “Leveraging our proven capabilities, we look forward to playing a strategic role in achieving the Malaysian Government’s aspirations to lead Malaysia’s digital economy forward,” said Tan Sri Syed Zainal Abidin Syed Mohamed Tahir Jamalullail. As of 31 March 2024, DNeX is in a healthy net cash position, with a total cash balance of RM630.6 million, exceeding total borrowings of RM252.4 million. Tan Sri Syed Zainal Abidin Syed Mohamed Tahir Jamalullail, Executive Chairman of DNeX, emphasised the company’s commitment to diversifying its revenue streams to drive growth. This strategy involves leveraging DNeX’s strengths across its three main business segments, expanding into adjacent profitable sectors, and forming strategic partnerships to enhance long-term financial performance. “In our Technology business, we anticipate a rebound in the global semiconductor market later in 2024, supported by a recovery in consumer, automotive, and industrial markets. To capitalise on this recovery, we are intensifying efforts to attract high-quality customers and enhance our Silicon Photonic technology. Additionally, we aim to fast-track the qualification process for products in emerging technology sectors, accelerating their market entry,” he stated. DNeX’s strategic focus and robust performance across its business segments position the company well for continued growth and financial success in the upcoming quarters.

KUALA LUMPUR: Malaysia has surpassed Thailand to become South-East Asia’s second-largest auto market, trailing only Indonesia. This marks a significant shift in a region that has become a crucial battleground for Asian automakers. Nikkei Asia analysed sales data from industry groups in Malaysia, Thailand, Indonesia, the Philippines, and Vietnam, revealing that Malaysia’s auto sales, which had long been third, outpaced Thailand’s for three consecutive quarters through January to March 2024. The Malaysian Automotive Association reported a 5% increase in auto sales in the first quarter compared to the previous year, reaching 202,245 vehicles. This followed an 11% increase in 2023, setting a record of 799,731 vehicles sold. Government sales tax exemptions for domestically produced vehicles, part of an economic stimulus package, bolstered national car brands Perodua and Proton, which together captured about 60% of the market share. Although these tax exemptions ceased in mid-2022, the fulfillment of tax-free bookings continued to boost 2023 sales. “Many new model launches, including competitively priced electric vehicles, helped spur sales,” the association stated. Ivan Khoo, a Toyota sales agent, told Nikkei Asia that sales in the first two months of 2024 exceeded expectations, with the Vios being the most popular model, priced below RM100,000. “Both segments, Toyota’s ICE (internal combustion engine) and hybrid cars, will continue to do well,” Khoo added. In contrast, Thailand’s auto sales have slumped. Known as the “Detroit of Asia” for its automotive industry concentration, Thailand fell to third place after a 25% year-on-year drop in first-quarter sales. Monthly auto sales have been declining since last June due to rising non-performing auto loans and stagnant consumption. The share of EVs is increasing, driven by the entry of Chinese manufacturers. Indonesia is also struggling, with first-quarter auto sales down 24% year-on-year due to rising interest rates, leading consumers to delay purchases. Sales in 2023 were just over one million vehicles, down 4% from 2022 and 30,000 fewer than in 2019, falling short of the Association of Indonesia Automotive Industries’ target of 1.05 million. Vietnam’s auto sales fell 16% in the first quarter, with the domestic economy stagnant due to sluggish exports and other factors. Despite a surge in demand in December before the expiration of a reduction in registration fees for domestically produced cars, sales figures declined year-on-year in January and February.