KUALA LUMPUR (Sept 22): Malaysia is still on the right track in the transformation of its automotive industry towards electrification, despite having a slow start and lagging behind its Asian peers, said iFast Capital's research unit.

It said the local electric vehicle (EV) industry is well-placed for further development due to strong input industries that are needed for EV production.

“Malaysia has strong input industry with many local companies playing a part in the global EV supply chain, such as semiconductors, battery assembly and copper wire manufacturing.

“With all of the supportive policy measures in line, we believe that the electric vehicle market in Malaysia will experience exponential growth,” iFast said in a note on Thursday (Sept 22).

Although the EV industry has experienced a tremendous rise in terms of sales volume and market share in the past few years, the firm said there is still a lot of market share left to capture, “especially in the emerging markets, where EV penetration rate is lower due to fewer available models and expensive”.

In addition, iFast said the lack of widely accessible charging infrastructure and weaker regulatory push also contribute to slower market uptake in emerging markets.

“Therefore, we believe that the decreasing EV prices due to economies of scale and increasing driving ranges in future years, as well as the installation of more charging stations, will boost the EV industry in the emerging markets,” it said.

iFast highlighted eight EV-related stocks in Malaysia, namely Greatech Technology Bhd, D&O Green Technologies Bhd, Pestech International Bhd, Malaysian Pacific Industries Bhd, Pentamaster Corp Bhd, Genetec Technology Bhd and KESM Industries Bhd.

“Overall, we are positive on the global EV market and the valuations are attractive,” it said.