PETALING JAYA: Philip Research is bullish about the prospects of Pentamaster Corp Bhd
based on rising global demand for electric vehicle (EV) powered by silicon carbide (SiC) batteries and advancements in automotive technology.
Quoting Mordor Intelligence, the research house said the automotive semiconductor market is projected to grow at a compound annual growth rate (CAGR) of 14%, from US$71.6bil to US$140.5bil by 2028, with the Asia-Pacific region in particular expected to experience rapid growth driven by increasing car production, collaborations between automakers and semiconductor producers, as well as a surge in EV demand.
The research house reported that the automotive segment, which accounted for 20% of total revenue for Pentamaster in 2020, has grown to more than 50% in the first nine months of 2023, largely due to growth for its SiC and insulator gate bipolar transistor (IGBT) products.
Despite a recent slowing in EV demand, the research outfit believes the fundamental trends driving the automotive semiconductor market, such as the push for more advanced and electronic-intensive vehicles, suggest a resilient and eventual rebound in semiconductor demand in the automotive sector.
“The EV revolution is driving the need for advanced testing technologies and precise assembly solutions for power devices like IGBT and SiC-based components. Pentamaster offers comprehensive, customisable solutions for IGBT, which range from component assembly to final inspection and testing.
“The group also leads in burn-in test solutions for wafer-level packages. The demand for these IGBT and SiC components is rapidly growing, fuelled by technological advancements.
“As Pentamaster has also branched into the medical industry with its acquisition of TP Concept Sdn Bhd in 2019, Philip Research sees the expansion of the existing customer base in Penang, and the rising demand for healthcare products to serve as the other avenues for the former’s earnings growth.
“Pentamaster is in the midst of completing a third plant with an area of 720,000 sq ft partly catering for the medical segment expansion.
“Overall, we project a three-year profit CAGR of 17% driven by recovery in the automotive and semiconductor segment coupled with deeper penetration into the medical segment,” said the research house in a report on Pentamaster published yesterday.
