MMS order book rising


"We have set the end of October as the cutting off date for orders to come in for the financial year 2021 because of the movement control order that restricts us from operating at maximum capacity. “Usually, the deadline for orders is in late November,” said group managing director T K Sia. (File pic shows Sia checking testing equipment at the factory)

George Town: Riding on the surge in the global demand for semiconductor test equipment, MMS Ventures Bhd is optimistic of doubling its orders this year and achieving a double-digit percentage growth this financial year.

“The group’s order book is now about 75% filled up, and we expect more purchasing orders to come in over the next two months. We have set the end of October as the cutting off date for orders to come in for the financial year 2021 because of the movement control order that restricts us from operating at maximum capacity.

“Usually, the deadline for orders is in late November,” said group managing director T K Sia.

So far, the group has delivered more than 20 semiconductor test equipment to multi-national corporation (MNC) customers in the country and to the United States, which is more than what the group shipped out in 2020.

“Based on customers’ feedback and orders in hand, we can expect the shipment this year to double,” he said.

MMS manufactures test equipment used in the assembly and packaging of smartphones and automotive sensors. Each test equipment, depending on the complexity of its functions and size, is priced between US$200,000 (RM844,000) and US$400,000 (RM1.69mil).

“More than 60% of the test equipment will be used in smartphones, while the automotive sector consumes 20%, and the other semiconductor segments the remainder,” he said.

According to the Semiconductors Equipment Manufacturers Industry (SEMI), the semiconductor test equipment market will grow 26% in 2021 to US$7.6bil (RM32.07bil) and expand another 6% in 2022, driven by the demand for 5G and high-performance computing (HPC) applications.

MMS Ventures factoryMMS Ventures factory

“South Korea, Taiwan and China are expected to be the top spenders for semiconductor test equipment the year. This is especially true for China, as Chinese smartphone maker Xiaomi has stolen Apple’s market share. Some of our semiconductor test equipment is sold in Taiwan and China,” Sia said.

“The demand for smartphones fell drastically in 2020. Therefore, we are seeing significant growth this year, driven by more mid-range pricing models and 5G mobile devices,” he added.

According to Sia, the automotive sector would be another critical sector growth driver for the test equipment business in 2021.

“We expect the automotive sector to contribute above 20% to the group the year.

“Research firm Trendforce expects vehicle sales to increase to 84 million units in 2021 from 77 million units in 2020. At the same time, the rising popularity of autonomous, connected and electric vehicles is likely to lead to massive consumption of various semiconductor components,” he said.

According to the latest forecasts by research firm Canalys, global smartphone shipments will grow 12% year-on-year in 2021 to reach 1.4 billion units. Canalys said 5G handsets accounted for 37% of global smartphone shipments in the first quarter of 2021.

“The transition from 4G to 5G is rapidly gaining pace.

“Over the past few months, the 5G price point has come down drastically thanks to the introduction of affordable 5G chipsets like Qualcomm’s Snapdragon 480 and MediaTek’s Dimensity 700.

“Many vendors are even ready to sacrifice other features like display and camera to accommodate 5G at lower prices.

“Perhaps they are responding to the growing consumer demand for affordable 5G smartphones.

“This share could grow up to 43% for the full year. In figures, 610 million of the total 1.4 billion smartphone units expected to ship this year could be 5G-ready.

“Around 32% (195 million) of those will cost less than US$300 (RM1,266),” the Canalys report said.

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