Is there improvement on Electronics sector?

In the recent Government report, it has indicated an improvement in the Electronics export. I am not sure what it means exactly. Does it mean that the Electronics industry is improving after years of down slide?

I have actually stopped looking at charts for a year due to the additional member of my family. I have recently managed to get myself re-organized and improved on my schedules, thereby allowing me to look at stocks again. The look on SES Electronics however, make my mouth opened.


The chart contains data of SES Electonics dated from August 2003 to May 2006. It peaked in January 2004 and has been going south since then. Considering the index as a reflection of the actual market six months ahead, Electronics has not been doing well all these while when other sectors were improving in their performance.

While I am still working in the Electronic industry, the pinch of the Electronic sector has not really affected my company. This is mainly due to the fact thaty my company's business deals mainly on reginal support. It has in fact did quite well in moving itself to regional market. As for local businesses, the focal point seems to be on only a few major players. There has been no new business so far. While I could still find abundance of customers into electronics design during the year 2000 to 2001, most of these customers seems to have folded their business or have their operations moved to China.

Singapore was teaming with distributors during its hay days, and the number has continued to grow. That is until the market was hit during the year 2001. As far as I know, many of my competitors have moved out to China looking for greener pasture. Companies like Achieva, Excelpoint seems to get a foot hold in China, Enzer repositioned itself to integrate higher to the level of consumer electronics, Flextech managed to get investment from Arrow. What's left are the major international players who have invested in Singapore and now struggling with thin margins or suffers low revenue.

Up till now, I am still waiting for the sun to rise again for Electronics. Will electronics regain its foot hold in Singapore? If yes, then in what form is it making a come back? So far the Government has opened up a few venues for Electronics in areas of wafer fabrication and LCD manufacturing. Unfortunately the take up rate for such offers has been low. In Pasir Ris where the government has allocated for LCD manufacturing facilities for instance, there are still a huge patch of land still vacant. Harddisk sector is left with Seagate, while Motorola is the only company in the mobile business in Singapore. The wafer fabrication facilities are mainly government linked. It is difficult to see at the moment how the Electronics is going to reverse its trend.

Going back to the chart, as its movement continue to go south, I can't help but to notice a wedge formation on the down trend. It may seem like there is hope for Electronics still. We will just have to see how it is going to manifest itself.