Bioalpha banks on overseas ops to boost revenue growth in 2017
KUCHING: Bioalpha Holdings Bhd ( Bioalpha) is banking on its overseas operations to enhance the group’s revenue growth in 2017.
The research division of CIMB Investment Bank Bhd (CIMB Research) in a recent strategy report said the integrated herbal supplement distributor could witness strong growth from the group’s operations in Indonesia and China.
The research firm observed that Indonesia is the company’s largest revenue contributor, accounting for close to half of the group’s revenue business excluding the pharmacy segment.
CIMB Research noted Bioalpha has opened a new plant in Riau, Indonesia this year which should help to accelerate product’s registration in the country.
With the opening of a new factory in Indonesia, the research firm believed that it should enable Bioalpha to obtain certification for its products in six months’ time against two to three years previously.
Meanwhile, CIMB Research noted the company currently distributes only 10 products in Indonesia and gathered that the company aims to double the amount to 20 by early 2017.
The research firm estimated that revenue contribution from Indonesia could double in 2017.
Besides that, CIMB Research believed 2017 should also be an interesting year for Bioalpha as it observed that the company has focused its marketing and promotional efforts in northwest China in the third quarter of 2016 (3Q16), where most of the Muslims in China are residing.
It pointed out that Bioalpha’s main strength lies with the company’s halal certification which is well respected.
The research firm noted that Bioalpha currently has five products for sale in China and gathered that the company is looking to launch five more new products in 2017.
It projected sales from northwest China are expected to be recognised into the group’s accounts from first quarter of 2017 (1Q17) onwards.
Apart from that, CIMB Research said Bioalpha also has plans to open more pharmacies in 2017.
It observed that Bioalpha spent quite a bit of money in 2016 to renovate and rebrand the Constant pharmacy group in which the company acquired in end of 2015.