As Malaysians, we’re always
proud when our local businesses thrive and are able to positively represent our
country on the world stage.

This year, 3 Malaysian companies made it to Forbes’ Asia’s 200 Best Under A Billion, which is a list meant to spotlight “200 small and midsized publicly listed enterprises in the Asia-Pacific region with sales under $1 billion and a track record of strong earnings growth.”

The 3 companies featured are Elsoft Research from the semiconductor industry, Pentamaster from the factory automation industry, and Vitrox from the electronic components industry, and they’re all supported by MDEC (Malaysia Digital Economy Corporation) Global Acceleration & Innovation Network program (GAIN).

We got in touch with
them to learn a little more about what they do, the biggest challenges they’ve
faced so far, what future plans they have in store for company growth and
direction, and what sort of exciting developments they foresee in their
industry in the next 2 years.

What Do They Do?

Image Credit: Elsoft

Speaking to Tan Cheik
Eaik, CEO of Elsoft Research, he told us that “Elsoft stands for ‘electronics’
and ‘software’”, and that they’re “involved in doing the research, design and
manufacture of automated test equipment (ATE) and burn-in systems for the LED
and optoelectronics industry.”

Elsoft Research Bhd
was established in 2004 but has been in operation since 1994. Their customers
are LED manufacturers who supply high-performance LEDs for application in smart
devices, the automotive and general lighting industries.

“Our second product
division is in fact embedded controllers, which is actually one of the key initiatives
by MDEC,” Tan said.

“We design the
electronics controller board with embedded firmware, which is actually a micro-code
intelligent firmware, so they can carry out the function. The application of
that embedded controller is for medical devices like peritonial dialysis machines.”

Image Credit: Pentamaster

Pentamaster CEO Chuah
Chong Ewe said that the company’s main business lies in automation, and that
they have 2 sectors.

“One is called ATE
which is all the test equipment for semiconductors IC (integrated circuit),
auto electronics, smart devices, IoT, 3D sensors.”

“The other sector is a factory automation system that’s more towards Industry 4.0. This is where factories want to replace manual labour with automation using robots,” he told us.

Since Pentamaster’s
establishment in 1991 and with its almost-30 years of automation experience,
their “put-out is mainly 80% exports to all the multinational corporations.”

The company serves
customers in sectors ranging from “semiconductor, computer, electrical and
electronics, pharmaceutical, medical devices, automotive, food and beverage,
consumer goods to general manufacturing.”

Image Credit: ViTrox

ViTrox is a machine
vision solutions provider that designs automated vision inspection equipment
and systems “ranging from back-end semiconductor, PCBA SMT (printed circuit
board assembly using surface-mount technology), to final assembly inspection,
and integrated with Industry 4.0 smart solutions and system-on-ship embedded
electronic solutions,” said ViTrox CEO Chu Jenn Weng.

Established in 2000
but converted to a public limited company in 2004, they “currently export approximately
74% of goods and services to more than 24 countries.”

“ViTrox maintains a
balanced composition of customers from a wide diversified end market such as telecommunication
infrastructure, automotive, medical devices, aerospace, computing, and mobile
devices,” he said.

The Biggest
Challenges They Face

For Elsoft, the
biggest challenge has been continuous growth, which Tan said “is actually quite
hard, but for the past almost 10 years have been okay despite a downtrend from
2005 to 2009.”

“Since 2009 we are in
a very good growth path but to sustain that year after year is a very challenging
job,” he said, “We have to not only grow the top line, but we need to ensure
that the bottom line is also healthy.”

“We have to
continuously focus on our R&D to develop a new product so that we can
actually give a better value equipment for our customer.”

Pentamaster has about
600 employees today, according to Chuah, “and out of these 600 employees we
have about 400 engineers,” he said.

“Today in the
automation industry you need a lot of engineers and we don’t depend on machines
to make machines.”

“You need a lot of
good engineers to come up with the design, and our engineers range from
mechanical, electronic, computer science, and controls.”

The challenge faced by
Pentamaster is the shortage of engineers, and to retain good engineers he said,
“I think we have to give a very conducive work environment, competitive packages,
staff benefits and also make the job challenging and interesting.”

“The revolution, the
evolution of technology is so fast, so as a company we cannot stay stagnant.
Our engineers have to be very proactive and innovative.”

Similar to
Pentamaster, ViTrox’s biggest challenge is “to attract, recruit and motivate engineering
and programming talents as a local company,” Chu said.

“We need to compete
with well-known and big high-tech MNCs for talents. Furthermore, MNCs can
easily get financial support from the government to hire new talents.”

Their Experience

“The team is actually
superb; they are very helpful, courteous and professional,” Tan said, “They’re
the best department we’ve dealt with among all the government or
semi-government departments.”

Chuah said, “I think
MDEC GAIN is a good platform for local companies to showcase, they help you to
collaborate with industries, local universities and institutions.”

“In our business, we
need visibility by our customers, the industries and universities, so we need
to work very closely with universities in terms of R&D and also tapping
into the human capital.”

“We joined MDEC GAIN
for an immersion trip to US where we met and learned from the strong startup
ecosystem in the bay area. It was a great learning experience where we were
able to network with companies and experienced their work culture,” Chu said.

After Being Featured
By Forbes, What’s Next?

Having been featured
in Forbes’ Asia’s 200 Best Under A Billion for 3 consecutive years, Pentamaster
feels honoured, but Chuah also said that it shows how Malaysia still falls short
when it comes to its companies being featured on the world stage.

122 of the 200
companies featured this year come from China, Hong Kong and Taiwan, and they dominated
the list last year, too.

According to Chuah,
the feature is a “so-called certification of the stability and growth of a
company,” and it also “increases customer confidence” which has contributed to
Pentamaster’s “double-digit growth every year”.

 For Elsoft, “one of our plans is to slightly diversify from our current business. With our core competency of electronics and software capability, we can actually venture into embedded controllers for medical devices,” Tan said.

“Of course the one
that we are already good at doing, we will also put in a lot of effort into it
this year because there are lots of new products, like in the automotive market
we have LED headlamp testers.”

This feature is ViTrox’s
5th time on the list, and Chu said, “We will continue to stay focused on
R&D, market expansion and talent development” to help industries “achieve zero
defects and optimised productivity in their manufacturing.”

“We hope to grow beyond
USD1B market cap in the next 5 years,” he added.

In The Next 2 Years

Tan foresees a pickup
in demand for 5G components for phones and thus an increase in the demand for
the equipment needed to test those phones, too.

This would mean “a lot
of business for the whole industry”, “so we actually see the next 2 years we
are going for better times.”

Another sector he foresees
will increase demand for electronics would be the autonomous cars sector, and
Elsoft would potentially benefit from that as well since they make test equipment
for electronics and sensors.

Pentamaster sees the
US-China trade war as an opportunity for growth, as Chuah said, “Now we see
more enquiries, more interest coming from Chinese companies to buy from
Malaysia” and “the same goes for US, we see more demand and enquiries from
them, too.”

For the next 2 years, “we
will try to capitalise on this trade war,” he said, calling it “trade diversion”.

ViTrox “is in a very
good position,” Chu said. “We are extremely excited about the 5G, AI and
Industry 4.0 development, in which these developments will transform the entire
world towards a digital economy.”

“We believe many of our customers, primarily the OSAT (Outsourced Assembly and Test) and EMS (Electronics Manufacturing Services) in the semiconductor and electronics assembly industries will benefit from these megatrends.”

  • You can read more of our editorials on companies featured by Forbes here.

Featured Image Credit: Elsoft / Pentamaster / Vitrox