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Thai Oil Plc
Tisco Securities has maintained its "hold" rating on Thai Oil shares with a 12-month target price of Bt65.
Thai Oil announced a project to build an ethanol plant with a production capacity of 100,000 litres per day, to be located in the province of Tak. A joint venture company, Maesod Clean Energy Co Ltd, has been set up to undertake the project. The company paid Bt30 million for a 30-per-cent stake in Maesod Clean Energy, with Padaeng Industry Plc and Petrogreen Co Ltd as two other strategic partners. The ethanol plant will use sugar cane as the raw material, to be supplied by Petrogreen, an associate of Mitr Phol Sugar. Total investment in the project has not been disclosed, but the broker estimates it is about US$50 million (Bt1.87 billion). Thai Oil intends to market ethanol produced at the plant to oil companies supplying the northern provinces, where demand for unleaded octane-95 petrol accounts for 9 per cent of Thai demand. The brokerage estimates that the contribution from this project to Thai Oil's bottom line would be minimal - about 0.2 per cent - starting from 2008. The oil refiner plans to build a second ethanol plant with a daily production of 500,000 litres.
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