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Monday, August 27, 2018

MMS Ventures expects higher sales of automotive test equipment

Monday, 27 Aug 2018

GEORGE TOWN: MMS Ventures Bhd  expects the sales of its test equipment to the auto sector to contribute about 15% this year, up from 5% in 2017.
Group managing director TK Sia said sales of automotive test equipment has so far played an important role in offsetting the slower demand from the smart device sector for the group’s test-equipment.

“The sales to the smart device has dropped so this year because our customers are not changing much of the flash lighting features of the smart phones planned for release this year.

“In the automotive sector, however, we can see a lot changes in the exterior and interior LED lighting system of newly release automobiles. Manufacturers are investing into the LED lighting because rear and front lights design are essential in enhancing the aesthetics.

“Sales contribution of testers to the auto sector should increase by a fifth in 2019,” Sia added.

Elsoft Research Bhd  expects its automotive contribution to rise by a third in 2018.

“Since 2014, the sales to the automotive sector contributes between 40% and 50% of group revenue. The sales to the automotive has contracted in the first half of 2018, but we expect it to pick up in the second half, contributing more than a third this year,” group chief executive officer C.E. Tan says.

Elsoft testers are used for testing the daytime running lights and rear lights.

The group expects to end the 2018 financial year with record high shipments of test equipment. This would impact positively revenue and profit.

In the group’s second half order book, more than 30 test equipment are due for delivery before the end of December.

“Based on today’s market price of RM1mil per unit, the test equipment is worth more than RM30mil in the market.

“More orders are coming. We accept orders until October, as the time needed to assemble a test equipment is between 10 and 16 weeks, depending on whether it was a repeat order or for a new equipment.

“In the first half of 2018, the group delivered more than 40 units. Last year, we shipped out about 60 units worth about RM60mil,” Tan said.

He said the group was able to achieve record breaking results for its revenue and profit this year as the volume of test-equipment shipment for 2018 was expected to be a record high.


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