PETALING JAYA: The progressive advancement in digital technology is a boon for QES Group Bhd, as the company is well-positioned to tap future demand for semiconductors.

Managing director and president Chew Ne Weng said the eventual mass rollout of 5G will prompt an upgrade in a lot of devices and infrastructure which will drive demand for semiconductors.

“This is an exciting time. Technologies like 5G, Internet-of-Things (IoT) and artificial intelligence will take off in a big way. If the pandemic can be contained next year, then things will take off, maybe, by mid-2021.

“I think the next three years will be very good for companies involved in semiconductor, equipment making, or relating to these market segments. I foresee strong growth.

“For example, your new 5G enabled phone will have a lot of new components. Then there’s the IR4.0 where there will be a lot of sensors, which uses semiconductors.

“And when electric vehicles become more prevalent, that will have a lot of components. So all this will drive demand. And we are in the right position and market segment, ” he said.

The group specialises in the distribution, manufacturing and provisions of engineering services for inspection, test, measuring, analytical and automated handling equipment.

QES is planning to raise about RM20.47mil from the placement of 10% of its issued share capital or 75.83 million new shares to help the company gear towards this growth.

According to its announcement to Bursa Malaysia, RM8.2mil from the placement exercise will be used for factory expansion, RM5.3mil will go towards its R&D works, while another RM1.5mil will be used to expand its reach in China.

He noted that the ongoing spat between China and the US has a positive spillover effect on the region as China looks to boost its own capabilities in semiconductor.

This could translate to increased demand for equipment makers in the region.

QES manufactures integrated circuit equipmentQES manufactures integrated circuit equipment

“The final amount we raise will be based on the market price and the market is volatile. But generally, if a company is profitable with the right management and we have a clear direction, I think serious investors will be in for the long haul, ” he said.

The counter closed at 27.5 sen last Friday.

Apart from manufacturing semiconductor equipment, Chew said QES has also gone into developing solutions for IR4.0, which would be another area of growth for the company.

“Data has become the new commodity and those who know how to analyse and automate it can be successful.

“So for QES, we have some solutions that target that. It is a lot to do with data collection, automation and data-driven decision making.

“We have to put in the engineering resources, R&D and money to develop them. But I think it will bear fruit because the market is ready.

“I think within the next 12 months, we can come up with a solution which we can start marketing by mid-2021 onwards, ” said Chew.

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