PETALING JAYA: Vitrox Corp Bhd is banking on the launch of new products and its regional expansion to fuel growth in the financial year (FY) ending Dec 31.
Managing director Chu Jenn Weng told StarBiz the company planned to strengthen our product lines by the introduction of new products, and further expand our market share in Malaysia and overseas.
The company was looking to appoint one agent in Taiwan, three in China and one or two'' in Malaysia, and was now in talks with a number of local and foreign companies'', he said.
K&N Kenanga Research in a report said it expected sales of Vitroxs vision inspection systems to double for FY2006 to 800 units from 400 units sold in FY2005.
In mid-December, the company signed an exclusive contract with Penang-based multinational test and inspection equipment manufacturer SRM Integration (M) Sdn Bhd.
With the leading test handler manufacturer as a customer, the future can only be promising, especially when SRM's newly added capacity is coming on-stream in early 2007, K&N Kenanga said.
SRM has been Vitroxs biggest customer, contributing 62% to FY2005 earnings.
In the near term, contribution from SRM is expected to remain substantial, the research house said.
In the first quarter of this year, the company planned to introduce new products which were substantial upgrades to its existing offerings, Chu said. The new products are expected to contribute immediately to revenue.
The companys new vision systems have generated much interest among its key customers, K&N Kenanga said, adding that the selling prices of the new products were expected to be substantially higher than those of standard systems''.
He said while this would increase costs, it was necessary for the expansion of the companys three core businesses of vision systems, automated optical inspection systems and electronic communication systems.
K&N Kenanga Research has a buy call on the counter for the burgeoning demand for automation equipment, strong value proposition to its end clients and sterling (estimated) revenue growth of 72% in the next two years.
For the nine months ended Sept 30, 2006, Vitrox posted a net profit of RM7.5mil on revenue of RM17.4mil.