Published July 16, 2008
Qian Hu plans further expansion
SINGAPORE'S ornamental fish exporter Qian Hu plans to further expand into foreign markets and expects to generate more than half of its sales in Asia by 2013, its head said yesterday
The company exports its aquarium and pet accessories to 20 to 30 countries and hopes that figure could rise to between 70 and 80 countries in five years.
The expansion plans come despite worsening market sentiment as it believes the pet industry is relatively immune to economic downturns.
'Despite the fact that the economic situation is very choppy around the world, pet industries or the ornamental fish industry is relatively recession-proof,' Kenny Yap, executive chairman and managing director of Qian Hu, told Reuters in an interview. 'Even during an economic downturn, I don't think anyone who loses their job will think of going home to kill their pets as the first thing to do. Pets will still have to be fed and taken care of, so that partly cushions the slowdown.'
Qian Hu exports ornamental fish to 75 countries and expects that to increase to 100 in five years.
Mr Yap is also bullish on China, where he expects the rise of its middle class to fuel demand for Qian Hu's fish. He predicts it could generate a fifth of group sales and profit in China within five years.
The firm's ornamental fish is available at more than 150 shops in China, a number Mr Yap expects to rise to 250 in the next three years.
In line with Qian Hu's vision to become the world's biggest exporter of ornamental fish, the firm is also looking out for joint ventures in India, Indonesia, Vietnam and the Middle East to develop its distribution network.
It is one of only three listed ornamental fish exporters in the world, along with Taiwan's Taikong Corp and Malaysia's Xian Leng.
Qian Hu's ornamental fish segment accounts for half of sales, while accessories make up 30 per cent. But with faster growth in accessories, Mr Yap expects half of revenues from that segment by 2013. 'We need to look for different pillars of growth and balance instead of relying on one product or segment. We are trying to spread our revenue base to get a balance as diversifying equates to stability.'
Qian Hu, which is worth US$41.3 million on the stock market, reported a 34 per cent jump in net profit to S$1.27 million for the first quarter of this year, with sales from aquarium accessories recording the biggest growth.
Shares of Qian Hu were trading at S$0.135 at 0807 GMT, down 18 per cent year-to-date. -- Reuters