VST predicts increasing growth as turnover rises 32pc
VST Holdings, a distributor of computer hard-disk drives and chips, estimated revenue would grow 20 per cent to 30 per cent to HK$4.4 billion to HK$4.8 billion in this financial year, partly boosted by the addition of of products from Western Digital (WD), the world's second-largest producer of hard-disk drives, to its sales portfolio.
VST, the largest distributor of Seagate and Maxtor hard drives on the mainland, became one of four authorised WD agents in China last month.
It expects sales of the outfit's hard drives to grow to at least 100,000 sets per month at HK$400 each, which would contribute at least HK$320 million to revenue this financial year ending in March next year.
'Otherwise we will be proven failures in this segment,' said VST chairman David Li Jialin yesterday.
He said the company's sales for the first quarter to June - before it began ofering WD drives - did not grow significantly but its net profit during the period grew in double digits due to improved inventory management.
VST sold 6.5 million sets of hard drives in the last financial year, accounting for about 30 per cent of the mainland market.
Net profit for the year to March soared to HK$111.76 million from HK$27.42 million in the previous year while turnover rose 32.28 per cent to HK$3.7 billion.
Sixty-six per cent of its revenue came from the sale of hard drives. The remainder came for the sale of 1.3 million units of AMD computer chips.
Mr Li said the price war between US chip giants Intel and Advanced Micro Devices did not hurt his company.
'It did not put much pressure on our 7 per cent gross profit margin, but on the contrary, stimulated our sales in computer chips,' he said.
As part of expansion strategy, Mr Li said VST planned to begin distributing computer parts to Southeast Asian markets including Thailand and Singapore this financial year. It has hired some experts to start working on the moves.
