The data industry is starting to harvest this year, riding the data center boom.

(Kuala Lumpur, 2nd) Entering the first quarter of 2025, Malacca Securities believes that the data center boom will continue to heat up, driving stocks related to construction, building materials, property, and utilities, further extending to the areas of Artificial Intelligence (AI) and cloud services, allowing technology stocks to finally have growth opportunities.

Malacca Securities' Research Director Liu Liyu pointed out in the report that as multinational corporations (MNCs) have just started investing in data centers during 2023 and 2024, returns are expected to come in from 2025.

"We are bullish on related stocks in the construction, building materials, industrial, and public utilities sectors."

At the same time, the report mentioned a transition from construction to Artificial Intelligence, security, and cloud service stages.

"We believe that the scope of the data center ecosystem will surpass traditional construction and extend to the areas of Artificial Intelligence, security, and cloud services."

He believes this will create opportunities for software companies focusing on cybersecurity, cloud computing service providers, and other related areas in the technology industry.

According to Knight Frank's data, Malaysia's net inflow of foreign direct investment (FDI) reached 141.72 billion Ringgit in the first 10 months of 2024, making it a leading country in FDI inflows in the region.

With a stable political environment, strategic geographical location, and business-friendly policies, our country has attracted investments from multinational giants such as Google, NVIDIA, Microsoft, and others.

The report also points out that the KL20 Summit held last year and the implementation of Malaysia's National Semiconductor Strategy (NSS) will further enhance our country's position in the global semiconductor industry, benefiting the technology sector, especially Electrical Components Services (EMS) companies.

On the other hand, considering the high maintenance of the USD index in the short term and the weakness of the Ringgit exchange rate, Liu Liyi believes that export-oriented industries such as technology and gloves will face strong buying pressure in the first quarter of this year.

According to the National Energy Transition Roadmap (NETR) plan, renewable energy capacity is expected to increase from 40% to 70% of total electricity generation by 2050.

"This target will unlock investment opportunities in the natural gas, renewable energy, and water resource industries."

At the same time, the New Industrial Blueprint for 2030 (NIMP 2030) plans to promote the development of Asia Vets and semiconductor factories, electric vehicles (EVs), as well as the chemical industry, providing Bullish for the manufacturing and technology sectors.

However, analysts also warn that Trump's assumption of the U.S. presidency this year will be a major uncertainty for the stock market.

After Trump's new government takes office in January, some unexpected new policies may cause a brief and intense global market reaction.

In addition, with the stable recovery of the tourism industry, the field of medical tourism is expected to experience growth.

Analysts also recommend that investors focus on companies with a solid balance sheet and stable dividend payout, such as property trusts and consumer sector.

=====

14 Preferred Stocks for the first quarter of 2025:

Provides comprehensive IT lifecycle solutions and services, including data center and hybrid IT infrastructure, wired and wireless networks, cybersecurity, etc. After acquiring 75% of the shares of Unique Central Group (UCG), it will occupy a favorable position in the data center market, especially in Johor state.

==

Electrical Components Services (EMS) company, involved in 5G technology, AI modules, and optical components. It plans to complete the Smart Factory 4.0 project by 2025 to enhance production capacity and profit potential.

==

With the global semiconductor outlook still strong, the focus on tariffs is on ultra-high purity gas (UHP) delivery systems, process engineering, and turnkey projects. After completing the acquisition of Ace Gases, it has been generating full income since last December.

==

Becoming the first Malaysian company to locally manufacture AI servers, collaborating with industry leaders such as NVIDIA to integrate cutting-edge technology. With the booming development of data centers, the company's performance is expected to further grow in the next 3 to 5 years.

==

Last June, Huang Renxun, the CEO of NVIDIA, pointed out at the Taipei International Computer Show that NVIDIA Institutions is an important participant in the Foxconn Industrial Internet factory ecosystem, playing a key role in edge AI and robot fields.

==

Providing underground facilities and substation engineering services for the local electrical industry, and holding a substantial order of 0.16 billion Ringgit for a hyperscale data center contract.

==

Benefiting from the global electrical infrastructure construction and the increasing demand for cables, this cable and wire manufacturer's total orders increased to 0.872 billion Ringgit.

==

Providing comprehensive IoT solutions through its subsidiaries, currently serving 0.025 million sites, mainly catering to corporate clients in industries such as utilities, financial services, and retail.

==

Recently acquired SJEE, a Mechanical and Electrical (M&E) company, holding a data center order of 73.5 million Ringgit to enter the rapidly growing data center market.

==

Focus on structural steel and energy projects, covering Southeast Asia, India, the Middle East, North Africa, among others, currently with a historical record of 6.7 billion Ringgit in orders.

==

Involved in industrial development, financial services, construction, industrial and hotel industry have fully recovered after the epidemic, and also hold 10.27% of shares in Industrial Bank (RHBBANK, 1066, main board financial stock), providing stable dividend income.

==

It is expected that higher tariffs on Chinese goods by the United States will increase local glove demand, benefiting from the strengthening of the USD as an export-oriented company.

==

Offshore energy facilities and service provider, focusing on EPCC business for FPSO, FSU, and OSV, will next collaborate with MISC (3816, Main Board transportation and logistics stock).

==

Solar photovoltaic system, grounding and lightning protection system, and other renewable energy solution provider. China Energy announces the rise in electricity tariffs from 2025 to 2027, as well as the implementation of NETR, will increase the adoption of solar photovoltaics.