PEN SJ Electronics Sdn Bhd will invest more than US$70 million (about RM300 million) in an advanced packaging facility at Batu Kawan Industrial Park 3 (BKIP 3), Penang, in a move set to deepen the state’s position in the semiconductor supply chain.
The company signed a lease agreement with Penang Development Corp (PDC) for a 3.44-hectare site to develop the facility, NST reported. The first phase is expected to create about 1,000 jobs, mainly high-skilled engineering positions in the materials segment of the semiconductor value chain.
Phase 1 operations will centre on the production of Thermal Interface Materials (TIM), specifically high-end indium-based TIM1 materials. In a report by The Edge Malaysia, Chief Minister Chow Kon Yeow said the company will subsequently expand into Phase 2, which involves manufacturing Integrated Heat Spreaders (IHS) to serve global and domestic clients.
PEN SJ is a subsidiary of SJ Electronics, a provider of advanced packaging materials and thermal management solutions for high-performance processing chips. Chow said SJ Electronics is one of only a few manufacturers in the world, and the sole company in China, capable of mass-producing high-end indium-based TIM1. The new plant aims to shorten supply chain lead times, lower warehousing and logistics costs for downstream partners and expand local advanced packaging capabilities.
“This investment will further strengthen Penang’s electrical and electronics (E&E) ecosystem, particularly in advanced semiconductor packaging and thermal management. It will also reinforce our position as the Silicon Valley of the East,” Chow said at the PEN SJ-PDC lease agreement announcement at his office in Komtar.
SJ Electronics founder Dr Fay Hua said the company plans to hire more than 1,000 employees for its Penang operations, with many positions for engineers working on core technologies. She said the company is focusing on technologies and materials required for advanced semiconductor packaging, including 2.5D and 3D packaging. The rapid advancement of artificial intelligence has increased the need for thermal materials to manage heat generated by semiconductor devices, she said. The company also intends to collaborate with local higher education institutions through internship and graduate training programmes to develop skilled talent for the industry.
Penang recorded RM17.3 billion in approved manufacturing investments in the first half of 2026, with foreign direct investments accounting for RM12.8 billion or 74 per cent. The electrical and electronics sector contributed RM11.0 billion, or 63 per cent, of the state’s total approved manufacturing investments during that period.
Between January and August 2026, Penang recorded RM606 billion in total exports, which accounts for 45 per cent of Malaysia’s total export volume. The state’s electrical and electronics exports reached nearly half a trillion ringgit, a 90 per cent increase from the same period last year, and made up more than 74 per cent of the nation’s electrical and electronics exports.
