NewsGlobalKhazanah Plans Strategic Capital Allocation to Power Infrastructure and Semiconductor SectorKhazanah Plans Strategic Capital Allocation to Power Infrastructure and Semiconductor Sector
Malaysia's Khazanah Nasional Bhd plans to increase capital allocation to power grid infrastructure and semiconductor firms, focusing on grid resilience and advanced packaging capabilities rather than data centres. The sovereign wealth fund reported strong performance with net asset value rising 22% to 103.60 billion ringgit (₹21,080 crores) in 2024, while positioning itself to capitalize on AI-driven investment opportunities in energy and chip manufacturing sectors.
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Malaysia's sovereign wealth fund Khazanah Nasional Bhd has outlined strategic plans to channel increased capital into power grid infrastructure and local semiconductor companies, positioning itself to capitalize on AI-driven investment opportunities. The announcement came during the World Economic Forum's annual meeting in Davos, where Managing Director Amirul Feisal Wan Zahir detailed the fund's investment priorities.
Strategic Focus on Energy Infrastructure
Khazanah's investment strategy centers on energy supply and grid resilience as core components of AI competitiveness. The fund plans to prioritize power infrastructure over the more crowded data centre investment space.
"What it does need is computing power and what computing power means energy. So that's when we think about capturing some of that growth," Amirul Feisal explained during the Reuters Global Markets Forum interview.
The fund's approach emphasizes:
- Grid resilience and reliability improvements
- Cheap and reliable power supply development
- Renewable energy integration
- Infrastructure scaling to support AI computing demands
Semiconductor Value Chain Development
The fund has identified significant opportunities in Malaysia's semiconductor sector, particularly in advanced packaging capabilities. Khazanah aims to support local chip manufacturers in moving up the value chain through targeted capital investments.
| Investment Focus: | Details |
|---|---|
| Target Sector: | Semiconductor advanced packaging |
| Government Goal: | 500 billion ringgit investment attraction |
| Fiscal Support: | $5.30 billion in incentives |
| Strategic Areas: | Chip design and advanced packaging |
This strategy aligns with Malaysia's broader industrial policies designed to strengthen the country's position in the global semiconductor supply chain. Prime Minister Anwar Ibrahim announced in May 2024 that the government targets at least 500 billion ringgit ($123.40 billion) in semiconductor investment, supported by substantial fiscal incentives.
Strong Financial Performance
Khazanah demonstrated robust financial growth, with significant improvement in its net asset value during 2024.
| Financial Metric: | 2024 | 2023 | Growth |
|---|---|---|---|
| Net Asset Value: | 103.60 billion ringgit | 84.80 billion ringgit | 22.00% |
| Net Asset Value (₹): | ₹21,080 crores | ₹17,246 crores | 22.00% |
The fund maintains a diversified portfolio spanning multiple markets, asset classes, sectors, and geographies. Notable holdings include CIMB Group, Malaysia's second-largest lender, and Malaysia Aviation Group, the national carrier.
Future Outlook and Currency Perspective
Amirul Feisal indicated that Khazanah expects its international portfolio share to increase gradually over time, reflecting the fund's global diversification strategy. Regarding the Malaysian ringgit, he expressed optimism about potential strengthening, though he noted this would depend on U.S. dollar movements and uncertainty surrounding U.S. interest rate policies.
The fund's strategic positioning in energy infrastructure and semiconductor advancement reflects broader trends in AI-driven investment cycles, where computing power requirements are reshaping traditional investment priorities toward foundational infrastructure and advanced manufacturing capabilities.
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