UWC Among Top Gainers, Analysts Lift Target Prices On Robust Semiconductor Demand

KUALA LUMPUR, June 24 (Bernama) -- UWC Bhd was among the top gainers on Bursa Malaysia today, up by more than four per cent in early trade after its third-quarter financial year 2026 (3Q FY2026) results came in line with expectations.

Core earnings are projected to improve further in the coming quarters, Kenanga Investment Bank said in a note today.

As at 10.56 am, share price of the precision engineering group gained 30 sen to RM6.36, with 1.20 million shares traded.

“Semiconductor segment loadings — both front-end and back-end — continue to ramp up,” the investment bank said.

It raised its target price (TP) to RM7.00 from RM4.70 previously.

On the front-end, it believes the wafer fabrication equipment cycle has room to run, supported by ongoing capacity expansion plans from key industry players such as TSMC, SpaceX's Terafab initiative, SK Hynix and Samsung.

More importantly, it said TSMC could further raise its capital expenditure next year while Samsung and SK Hynix have begun bringing forward portions of their memory capex plans amid improving demand visibility, signalling a more constructive outlook for front-end semiconductor spending.

"At the back-end, we expect growth from the new manipulator programme to normalise in due course after a period of rapid expansion, with order volumes having more than doubled year-on-year," the investment bank said.

Meanwhile, Hong Leong Investment Bank (HLIB) said sustained investments in memory and leading-edge logic have prompted industry expectations for wafer fabrication equipment spending of US$140 billion to US$150 billion in 2026, and US$190 billion to US$200 billion in 2027.

This is well above the semiconductor industry's upgraded April forecast of US$133 billion and US$155 billion, respectively.

"Reinforcing the positive outlook is unprecedented demand visibility. Major customers now share rolling eight-quarter forecasts, enabling wafer fabrication equipment suppliers to align their capacity expansion plans in advance," the investment bank said.

HLIB maintains its "Buy" call, raising its TP to RM7.10 from RM5.60.

"We like UWC's growing exposure to the front-end segment, which positions the company to capitalise on the ongoing wafer fabrication equipment capex upcycle," it said.

Nonetheless, HLIB said downside risks include a sharp pullback in semiconductor equipment capital expenditure.

-- BERNAMA