ASEAN Tech Hardware "Growing relevance in the broader supply chain" Koh

Research evidence excerpt

ASEAN Tech Hardware "Growing relevance in the broader supply chain" Koh

Global Research

8 July 2026ab

ASEAN Tech Hardware Equities

Asia Pacific Ex. JapanGrowing relevance in the broader supply chain

Technology

Joseph Koh

Takeaways from Penang Tech Tour Analyst

We visited 7 companies in the hardware tech supply chain in Penang, covering OSATs, joseph.koh@ubs.com

WFE supply chain as well as back-end SPE suppliers. We observed industry capacity in +603-2781 1182

Penang becoming progressively tighter and streamlining manufacturing workflows has Nicolas Gaudois

become a bigger emphasis. The Penang supply chain continues to benefit from push for Analyst

supply chain diversification by the broader sector, leading to local-based companies nicolas.gaudois@ubs.com

seeing strong demand visibility for the rest of 2026. See our meeting takeaways on page +65-6495 5148

3-8. Randy Abrams

Analyst

Front-end WFE supply chain continues to benefit from growing local content randy.abrams@ubs.com

+886-2-8722 7338

We noted that WFE industry leaders including Lam Research (see here) and Applied

Materials (see here) continue to expand their manufacturing footprint in Southeast Asia.

This has driven increasing demand for locally sourced WFE components and modules,

benefiting not only established tier-1 suppliers but also creating downstream

opportunities for smaller precision machining outfits. As tier-1 WFE module suppliers are

dealing with increasingly tight capacity, outsourcing lower-value components is starting

to make more commercial sense as they seek to optimise capacity utilisation and focus

on higher value-added assembly and integration activities.

AI-led demand spilling over to back-end semicap supply chain