Exclusive: Aemulus plans R&D, ops expansion, fundraising for 2015

Aemulus Amoeba 7600, image from website.

Malaysia’s semiconductor testing equipment designer Aemulus Corp Sdn Bhd has three strategies this year – to expand its research and development (R&D) resources and capex; expand its sales and marketing channels to China and the US; and to raise funds for those two strategies.

Speaking to DEALSTREETASIA, founder and CEO Ng Sang Beng said the Penang-based outfit is looking to crank up its R&D efforts by two to three times.
“Our R&D capex has been fluctuating between 12 per cent and 18 per cent of our revenue all this while, but going forward, we want to commit 15 per cent to 20 per cent of our revenue to it,” Ng said, not revealing the company’s revenue.
In 2015, Aemulus will target a 20 per cent to 50 per cent revenue growth, with the launch of a new product and broadening of its markets, he added.

The company has had a track record of 70 per cent annual average growth rate in revenue for the past seven years with the last year’s launch of the two new flagship products, contributing almost 80 per cent to it.

Aemulus designs solutions in the semiconductor automatic test equipment (ATE) segment, where they can be applied in testing radio frequency and wireless connection. It prides its designs as competitively-priced yet state-of-the-art.

According to Ng, 70 per cent of the company’s business is within the wireless technology domain, and they have recently secured a contract to produce equipment for the mixed signal domain.

As for its marketing expansion to the US and China, it will focus on product application and small scale R&D, he said.

On its initial public offering (IPO) plans, Ng declined to comment much, saying that the company was looking at various options to raise funds for its expansion. Recently, DEALSTREETASIA reported that Aemulus was likely to take the IPO route, although it was also considering the venture capitalist option.

Related story: Exclusive: Malaysia’s Aemulus seeks listing on ACE Market

However, Ng was clear that the founding team was not giving up a controlling stake, nor were they interested to dilute their pioneer holdings too much.

In the event of an IPO, Ng confirmed that Aemulus would be listed in the ACE Market, with an intention to transfer to the Main Board in time. “If the market is good, we would be able to raise a funds easily. We may eventually grow through mergers and acquisitions to get that quantum leap,” he said.

Aemulus has a big global market, with 65 per cent of its revenue streaming in from export sales in 2014. Ng’s ambition is to go bigger in the international arena, to position Aemulus as one of the significant players in this niche sector.

Ng names American company LTX-Credence and India-based National Components as its main competitors. Its tester equipment is used by the world’s two top smart phone makers and has clients in some notable Malaysian semiconductor manufacturers, such as Inari Amertron. “The semiconductor tester market is valued at about $5 billion and it has been growing double digit. The global players are not many because the entry barrier is high, and Malaysia has a significant cost advantage while we have the tech expertise,” Ng said of Aemulus’ potential to compete on a global scale.

Aemulus, he informed, was one of the very few such players who is doing well in the region.”The semiconductor industry is a cyclical one. At least in the next two years, the smart phone industry will continue to grow, alongside wearable technology and tablets,” he foresaw.

Endorsed by Endeavor


Aemulus, was selected as an Endeavor Entrepreneur at the International Selection Panel in Istanbul, Turkey last October.The selection meant the company would continue receiving mentorship from veteran entrepreneurs in their business.

“It’s a fantastic programme that has created a leapfrog for us. My mentor, Endeavor Malaysia chairman and and TIME dotcom Bhd CEO, Afzal Abdul Rahim has showed me how to bring the company to the next level,” Ng shared.

Apart from Afzal, whom Ng has had the privilege to learn from in the past eight months, Ng also attributes Aemulus’ success to his family. “In 2012 to 2013, our revenue was flat. A lot of resources were put into developing a new product and the team morale was pretty bad. I was in a dilemma whether to continue aggressively with this business,” he recounted.

“Afzal asked me to figure out what I wanted in this business, and my wife and mother encouraged me to go all out and concentrate on the business,” he said of the motivation that pulled him through a time of doubt.

Armed with a sense of responsibility to make things work, Ng told his staff that he wanted to push sales and hit an ambitious target. Within half a year after, Aemulus was able to grow its revenue by 130 per cent beyond the original MYR18 million revenue target Ng had set.

Aemulus was established in 2005 and received venture capital fund in 2010 from Teak Capital.

Also read: Malaysia’s Aemulus selected as Endeavor Entrepreneur