Vetece Holdings is one of those Malaysian technology companies most people have probably never heard of, even though it has worked with some very large organisations.
Its customers have included Telekom Malaysia, Australia’s Telstra and Malaysian financial institutions. Behind the scenes, the company helps large organisations implement, connect and maintain the enterprise technology systems they rely on every day.
But the most interesting part of the Vetece Holdings story is not the big names on its customer list.
It is what happened when one customer became responsible for almost half of its entire revenue.
By FY2024, Telekom Malaysia contributed more than 45% of Vetece’s revenue. For a relatively small technology company, that created an obvious risk.
Then the business started changing.
Revenue more than doubled the following year, telecommunications became a much smaller part of the company and new business came from the public sector, utilities and other industries.
The transformation looks impressive at first glance.
Dig deeper, however, and another issue appears.
Vetece was generating much more revenue, but profit was barely moving.
That makes this much more than a story about a small Malaysian technology company winning large corporate customers. It is also a useful case study in customer concentration, diversification and the difference between growing revenue and growing profit.
Calling Vetece Holdings a software company only tells part of the story.
Large corporations rarely rely on one piece of software.
They may have separate systems handling customers, billing, finance, employees, sales, databases, analytics and cloud services. Many of those systems need to communicate with each other.
That is where companies such as Vetece come in.
Its core business includes enterprise application implementation, system integration, data management, cloud infrastructure, software testing, maintenance, technical support and professional services.
It also works with technology products and platforms from companies such as Oracle, Microsoft, Salesforce, Amazon Web Services, WSO2, Cloudera and Red Hat.
The business can therefore earn revenue in several ways.
One customer may hire Vetece to implement a new enterprise system.
Another may require integration between several existing systems.
Some customers pay for ongoing maintenance and technical support.
Others purchase software licences, cloud products or hardware through Vetece.
Those revenue streams may all appear under the same company, but their economics can be very different.
That becomes important when looking at Vetece’s rapid growth after its ACE Market listing.
Telekom Malaysia was not a new customer for Vetece Holdings.
The relationship stretched back to 2007, with Vetece providing implementation, maintenance, support and professional services to the telecommunications group.
Over time, however, TM became increasingly important to the business.
In FY2021, Telekom Malaysia represented 15.74% of Vetece’s revenue.
By FY2022, the figure had increased to 22.81%.
Then came a much larger jump.
TM contributed 45.60% of total revenue in FY2023.
In FY2024, it still represented 45.21%.
Vetece generated approximately RM19.4 million in total revenue in FY2024.
That meant close to half of the business was effectively connected to one major customer.
For a growing company, winning a customer such as Telekom Malaysia is clearly valuable.
The contract brings revenue.
It gives the supplier experience handling large corporate projects.
It also gives the company credibility when approaching other major organisations.
There is another side to that success.
The more important one customer becomes, the harder that customer becomes to replace.
If a company generating RM20 million annually receives RM9 million from one customer, losing that account is very different from losing a customer contributing RM500,000.
That is customer concentration risk.
Vetece Holdings openly acknowledged it.
In its FY2024 annual report, the company listed reliance on Telekom Malaysia Berhad Group as a major client as its first key business risk.
The concern was straightforward.
If the relationship weakened, contracts were not renewed or TM reduced the amount of work awarded to Vetece, the financial impact could be substantial unless the company found enough new projects elsewhere.
Customer concentration is common among smaller companies selling to corporations or governments.
Landing one large customer can completely change the size of a business.
The danger starts when the supplier builds its cost structure around that relationship.
Staff may be hired specifically to service the account. Systems may be built around its requirements. Management may start forecasting future growth based on continued orders.
Everything works well while the customer stays.
Then circumstances change.
The customer appoints a different vendor.
A large project ends.
Budgets are reduced.
Management changes.
Procurement rules are revised.
Technology priorities move in another direction.
None of these situations require the customer to dislike the supplier.
Large organisations change vendors and budgets all the time.
That is why diversification becomes particularly important once a company reaches a certain size.
The goal is not necessarily to make the biggest customer smaller.
It is to make everything else bigger.
That appears to be what happened next at Vetece.
The FY2025 numbers looked very different.
Vetece Holdings revenue jumped from approximately RM19.4 million to RM46.3 million.
That represented growth of roughly 138% in a single financial year.
More interesting was the change in where that revenue came from.
Telecommunications had accounted for 45.21% of the company’s FY2024 revenue.
By FY2025, the entire telecommunications sector represented only 19.3% of revenue.
Meanwhile, the public sector had become Vetece’s biggest industry.
Public-sector customers generated approximately RM28.4 million, representing about 61.2% of FY2025 revenue.
Financial services contributed around 8.1%.
Utilities contributed 5.4%.
Higher education represented another 3.2%, while other industries made up the balance.
The change does not necessarily mean Telekom Malaysia stopped being an important customer.
Vetece did not disclose TM’s individual contribution in the same way for FY2025.
But the broader picture is clear.
The company was no longer as dependent on telecommunications as it had been one year earlier.
There was another interesting change.
In FY2024, reliance on Telekom Malaysia appeared as Vetece’s first key business risk.
In the FY2025 annual report, that specific risk was no longer on the list.
Instead, the company highlighted issues including increasing competition, dependence on key management and skilled employees, and cybersecurity threats.
For a company that had previously generated more than 45% of its revenue from TM, that is a significant shift.
Looking only at the headline number, FY2025 appeared exceptional.
Revenue went from:
RM19.4 million to RM46.3 million.
That is the type of growth figure that immediately attracts attention.
But revenue alone does not tell investors or business owners whether a company has actually become much more profitable.
Vetece provides a good example.
Despite revenue increasing by more than RM26 million, FY2025 profit after tax came in at approximately RM4.2 million.
Its adjusted FY2024 profit after tax, excluding one-off IPO listing expenses, was already around RM4.1 million.
So Vetece added tens of millions of ringgit in sales while adjusted profit barely changed.
The reason becomes much clearer when the revenue mix is broken down.
One part of the Vetece Holdings business grew extraordinarily quickly.
Hardware and software resale generated only around RM2.9 million in FY2024.
By FY2025, that figure had increased to approximately RM30.8 million.
It represented roughly 67% of the company’s entire annual revenue.
That explains much of the huge increase in sales.
It also explains why profit did not rise at the same speed.
Selling software licences, cloud products or hardware generally carries different margins from providing specialised implementation, consulting and technical services.
Vetece’s overall gross profit margin shows the effect.
The margin fell from approximately 32.8% in FY2024 to 15.8% in FY2025.
So while revenue surged, each ringgit of sales was generating less gross profit on average.
This is why companies should never be judged using revenue growth alone.
Imagine two businesses.
One generates RM30 million in sales at a strong margin.
Another generates RM100 million but earns very little on each sale.
The second company is much larger by revenue, but that does not automatically mean it has the better business.
The quality and profitability of that revenue are just as important.
The increase in resale revenue is not necessarily bad.
There is a strategic reason companies such as Vetece sell software and hardware even when margins are lower.
Getting the product into the customer can create the first relationship.
Once the customer buys a system, somebody still needs to implement it.
Different systems may need to be integrated.
Employees need support.
Software may require maintenance.
New features may need to be added.
Data has to be managed.
Cloud environments need ongoing work.
Vetece has said its expanding resale business can create opportunities to sell higher-margin implementation, maintenance and professional services to the same customers.
That is potentially much more interesting than the original licence sale.
If the strategy works, a low-margin software contract today can lead to several years of higher-value technical work.
The next few years will show how successfully Vetece can make that conversion.
Diversification continued into 2026.
In April 2026, a Vetece subsidiary secured a contract worth approximately RM39.63 million from a leading Malaysian utility company.
The project covers Salesforce customer relationship management cloud software subscriptions together with maintenance, support and enhancement services.
The contract runs across the financial years ending August 2026 through August 2029.
The size is worth putting into context.
Vetece’s entire FY2024 revenue was approximately RM19.4 million.
One RM39.63 million contract is therefore worth roughly twice the company’s total FY2024 revenue, although the revenue will be recognised over several years rather than all at once.
More importantly, the contract sits outside the telecommunications business that previously dominated Vetece.
The company is now building meaningful exposure to utilities alongside public-sector, financial-services and other customers.
That reduces one risk while opening another question.
Can Vetece turn these larger contracts into stronger long-term margins?
Vetece’s quarter ended 31 May 2026 provided another example.
Quarterly revenue reached approximately RM16.62 million, compared with RM6.06 million during the same quarter a year earlier.
Profit after tax increased from around RM865,000 to RM2.04 million.
That was a significant improvement.
But once again, most of the revenue came from resale.
Around RM11.55 million of quarterly revenue came from hardware and software resale, including cloud products.
Implementation services contributed approximately RM2.06 million.
Maintenance, support and professional services contributed another RM3.01 million.
The nine-month figures also show why quarterly growth should be viewed in context.
For the first nine months of FY2026, revenue stood at approximately RM32.63 million, compared with RM41.94 million during the corresponding period the previous year.
Yet profit after tax increased from approximately RM3.82 million to RM4.21 million.
That is almost the reverse of what happened in FY2025.
Previously, revenue grew dramatically while profit barely changed.
Now nine-month revenue was lower, yet profit improved.
The mix of business being sold can be just as important as the total amount being sold.
The Vetece story can almost be divided into chapters.
First came the long process of building credibility.
Its operating subsidiary began in 2003.
Over the years, the company managed to secure work from major organisations, including Telekom Malaysia, Telstra and financial institutions.
Then came the IPO.
Vetece Holdings listed on Bursa Malaysia’s ACE Market in August 2024 at an IPO price of RM0.25 per share.
Demand was strong.
The Malaysian public portion of the IPO was oversubscribed by approximately 187 times.
But being a listed company also makes the numbers much easier to examine.
And those numbers showed that Vetece had become heavily reliant on Telekom Malaysia.
The company then entered its next stage.
It expanded aggressively into other sectors.
Public-sector revenue grew sharply.
Utilities became more significant.
Hardware and software resale became a major business.
Telecommunications fell from almost half of revenue to less than one-fifth of the total sector mix.
That addressed one of the most obvious risks surrounding the company.
Now comes the next test.
The question around Vetece Holdings is no longer simply:
What happens if Telekom Malaysia reduces its business with the company?
Diversification has reduced the importance of that question.
The bigger issue now is whether Vetece can turn its much larger customer base into higher-margin recurring work.
Selling RM30 million worth of licences and hardware can make revenue look impressive.
Selling implementation, integration, maintenance, cloud and professional services around those products could make the relationships much more valuable.
If Vetece succeeds, its current expansion could create a stronger enterprise technology business with customers spread across several industries.
If the company remains heavily dependent on resale, revenue may continue looking much larger without profit growing at the same rate.
That is what makes Vetece Holdings interesting to follow.
This is no longer simply a story about a Malaysian technology company that managed to win Telekom Malaysia and Telstra as customers.
It is a story about what happens after a small company lands those big accounts.
First, you prove that you can serve them.
Then you make sure you are not dependent on them.
Finally, you have to prove that growth is actually making the business more profitable.
Vetece appears to have made meaningful progress on the second step.
The third will determine what kind of company it eventually becomes.
Figures in this article are based on Vetece Holdings annual reports, quarterly results and public company announcements available up to August 2026. This article is for business analysis and informational purposes only and does not constitute investment advice.
© Copyright 2024. Designed and Developed by Made in Malaysia.
