PETALING JAYA: Malaysian Pacific Industries
Bhd (MPI) is positioning artificial intelligence (AI) server-related power packaging as a key growth driver, supported by early investments in capacity and equipment that are already paying off amid rising global demand for AI infrastructure.
CIMB Research, following a results briefing on MPI’s third quarter for the financial year 2026 (3Q26), said it was encouraged by the group’s growth prospects over the next two years, underpinned by stronger demand visibility in the AI-related segment heading into the second half of 2026.
It noted that MPI’s AI-related revenue surged 81% year-on-year in 3Q26 and 55% for the nine-month period, lifting its contribution to 13% of group revenue from 9% in the same period a year earlier.
According to the research house, MPI is on track to commence the production ramp for its new-generation power module packages from June 2026, with meaningful contributions expected by 4Q26.
It had earlier invested US$65mil in new tools and production lines for the project, which analysts estimate could generate more than RM200mil in annual revenue by 2027.
“We understand that these new production lines are dedicated to Infineon Technologies AG’s next-generation power modules for AI servers.
“Infineon has guided for its AI power revenue to double in financial year 2026 (FY26),” CIMB Research said in a note to clients. “Overall, we expect AI-related revenue to account for 12% and 15% of MPI’s FY26 and FY27 revenue, respectively, versus 9% in FY25,” it added.
The research house also expects stronger earnings contribution from Carsem Semiconductor (Bangkok) Ltd (CSB), which has turned profitable. The group attributed the turnaround to better cost control, despite having taken over ownership of the plant for less than six weeks.
“CSB contributed 7% of MPI’s 3Q26 revenue, and we estimate this could rise to around 9% to 10% in 4Q26.” The research house reiterated its “buy” rating with a higher target price of RM50.
Meanwhile, TA Research upped the stock’s target price from RM32 to RM44, but kept a “hold” rating. It said the group will continue to benefit from the ongoing upcycle driven by AI-related spending.
“Management outlined the group’s long-term roadmap, which involves gradually shifting from an automotive-centric strategy towards AI, autonomous vehicles, and humanoid-related applications.
“It also guided that the group will continue to incur high capital expenditure in these areas to position itself for the next wave of growth,” TA Research further pointed out.
The research house said in the near term, the AI server segment will remain the group’s key priority and is expected to continue ramping up over the coming quarters, with management targeting AI server-related contributions to exceed 20% of total sales mix.
An analyst, when contacted, said MPI’s investment in AI server-related capacity ahead of the current wave of market excitement positions the group with an early-mover advantage over peers that are only now beginning to build up capacity.
Shares of MPI were trading at RM41.40 at the time of writing.
