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Thursday, March 30, 2017

Stronger quarters ahead for V.S. Industry

Wednesday, 29 March 2017 | MYT 2:45 PM

PETALING JAYA: V.S. Industry Bhd, which saw higher earnings for the second quarter amid stiff competition, expect stronger quarters ahead buoyed, among others, by original design manufacturer (ODM) brewer model production and seasonally stronger quarters for its US-based client Keurig Green Mountain Inc.

AmInvestment Bank Research on Wednesday said the other factor that would drive the company’s earnings would be the ramp-up in production of a floor-care product for “customer X”.

Since Feb’17, a second assembly line for the floor-care product had started running, while the third production line is expected to come on stream in May.

With spare capacity at customer X boxbuild factory, VSI has the capacity to take on further orders from its client, it noted.

For the second quarter ended Jan 31, 2017, the company raked in RM 35.5mil in net profit compared with RM27.5mil a year ago. For the six months, net profit contracted to RM69mil from RM87,7mil previously.

The research house was maintaining a buy call on the stock with a higher fair value (FV) of RM2 as it rolled forward its valuation to calender year 2018.


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