KUALA LUMPUR: Malaysia needs to move beyond data centres and nurture larger listed technology companies to attract global portfolio investment, said Principal Asset Management Bhd chief executive officer Munirah Khairuddin.
She said while opportunities are emerging beyond data centres in areas such as subsea cables, transmission towers and blockchain technology, Malaysia must also nurture technology companies of sufficient scale to feature more prominently in global equity indices.
"We are doing well in semiconductors, but can these companies have a bigger market capitalisation? We need to nurture larger listed technology firms capable of carrying greater weight in global equity indices," she told reporters on the sidelines of The Invest Shariah 2026 today.
The conference, themed "Ethical Investing in a Digital and Volatile World", was co-hosted by Bursa Malaysia and CGS International Securities Malaysia Sdn Bhd.
Malaysia's technology weighting lags regional peers
Citing the MSCI AC Asia Pacific Islamic Index, Munirah said information technology accounted for 51.1 per cent of the benchmark, compared with about one per cent in Malaysia's FBM EMAS Shariah Index, reflecting the limited representation of domestic technology companies.
She said Malaysia's technology firms remain relatively small, limiting the country's weighting in global equity indices and its ability to attract larger international portfolio flows.
"The challenge is how do we attract bigger technology companies? We need to explore ways to bring in co-investment, with local companies leading projects that could eventually be listed separately or increase the market capitalisation of existing firms," she said.
Munirah said stronger technology champions would raise Malaysia's weighting in global indices, making the market more attractive to international investors seeking growth opportunities.
"Global capital invests in growth companies and looks directly at the index. Malaysia's weight may not be significant enough.
"We have a growth story, but perhaps we need more of it. One or two technology initial public offerings are not significant enough," she said.
She said Malaysia could learn from Japan, South Korea and Taiwan in building globally competitive technology ecosystems, particularly in the semiconductor industry.
Munirah noted that the combined technology weighting of South Korea and Taiwan in regional indices exceeds China's despite the latter's much larger economy.
"I think we have a chance to learn because we are in a competitive position in ASEAN. Why don't we do more of that?" she said.
AI, healthcare and digitalisation to drive long-term growth
On broader investment trends, Munirah said artificial intelligence (AI), digitalisation and healthcare are among the structural themes driving long-term global investment.
AI is transforming industries beyond technology, including biotechnology, healthcare and logistics, while demographic shifts are creating new investment opportunities, she said.
"The whole world is ageing. Malaysia will become an aged society by 2030, while countries such as Thailand and Singapore are already aged. The structural trend in healthcare is very real. Healthcare, biotechnology and life sciences will all be powered by AI," she said.
Munirah said digitalisation should not be underestimated, stressing that cloud adoption remains fundamental to AI deployment.
"How many companies coming into Malaysia are on the cloud? Very few. Cloud is table stakes for AI. Without that digital foundation, it will be difficult to fully harness AI's potential," she said.
She added that logistics is also evolving alongside digitalisation and e-commerce, with growing demand for modern warehouses, automation, robotics and temperature-controlled storage facilities.
Malaysia well positioned to ride AI investment wave
Meanwhile, Munirah said portfolio diversification is no longer solely about reducing risk but ensuring investors have sufficient exposure to structural growth sectors.
On Malaysia's investment prospects, she said the country is well positioned to capitalise on the AI wave, supported by its growing semiconductor industry and expanding data centre ecosystem.
However, she said maintaining high standards, modernising industries and developing talent would be critical to attracting more foreign capital.
"It is really about standards. When you want to attract money to our shores, it is really about standards, modernisation and talent," she said. - Bernama
