Hot stock: Nanofilm falls 3.8% on possible project delays due to chip shortage

SHARES of mainboard-listed Nanofilm Technologies lost as much as 4.6 per cent on Wednesday, after it floated the possibility of deferring selected 3C projects due to the ongoing global chip shortage.

The nanotechnology firm ended Wednesday down 4.3 per cent or S$0.23 at S$5.08, after 4.7 million shares changed hands.

Nanofilm on Tuesday said it is "preparing for the possibility of deferment of selected 3C (computer, communications and consumer electronics) projects from its initial production schedules" as a result of the current global chip shortage situation.

It was responding to a shareholder question ahead of its annual general meeting on Wednesday.

It noted the global semiconductor market has "experienced significant tightening in Q1 due to the continued strong demand for semiconductors across multiple industries".

"The 3C industry is facing increasing pressure in their supply chain compared to Q4 last year (when the shortage was milder) and the current chip shortage has started to impact manufacturers' projected production run rate," Nanofilm said.

However, the company said it understands that 3C manufacturers are "stockpiling chips in anticipation of continuing shortage and upcoming peak season production ramp-up to ensure that their products are able to reach end consumers".

It believes that the supply chain should recover to its required production position and be ready for new product launches in the coming months.