Betagro Group, a leading agro-industrial manufacturer and exporter, is to invest Bt200 million this year to expand its production capacity for ready-to-eat products and processed food to serve rising domestic demand.

"The investment plan has been designed to balance trade between domestic sales and exports," group chief operations officer Vasit Taepaisitphongse said yesterday.

The group's sales average Bt30 billion a year, of which 65 per cent comes from the domestic market. The main products sold locally are fresh foods and frozen products.

However, sales of ready-to-eat goods and processed products contribute only 5 per cent of domestic sales.

"We are an agro-industrial manufacturer, so we have to expand our value-added products to serve customer demand and boost the products' margin because ready-to-eat meals and processed food have higher margins than fresh food and frozen products," he said.

The new plant will be complete at the end of the year and will be in operation next year, when it will produce a number of ready-to-eat and processed food products.

To balance the business expansion of both processed food and frozen products, the group's joint-venture firm, Betagro Ootoya (Thailand), plans to open five new branches this year and the first quarter of next year by investing up to Bt50 million.

Betagro holds a 42-per-cent stake in Betagro Ootoya (Thailand), 44 per cent is held by Japanese restaurant chain Ootoya, and the remaining 14 per cent by nine Japanese investors who do business in Thailand.

The Ootoya restaurant chain has 11 branches in Bangkok. Nine operate under the Ootoya name, the others being the Ootoya Kitchen quick-meal service and a take-home outlet called Ootoya Deli.

Vasit said Ootoya provided another channel for the Betagro Group to demonstrate its capacity to supply premium local ingredients and food services for international restaurants under its food-safety policy. More than 70 per cent of the Ootoya ingredients are locally sourced, with Betagro supplying chicken and pork products under the S-Pure brand.

With the expansion plan for three new branches this year, Betagro Ootoya (Thailand) expects sales growth of up to more than 200 per cent, from Bt95 million last year to Bt300 million this year.

Vasit added that Japanese restaurants were now popular with Thai consumers. According to Kasikorn Research Centre, the Japanese-restaurant business is expected to grow by 10-15 per cent this year to about Bt6 billion, thanks in large part to its strengths in health benefits and palatable flavours for local consumers.

At present, Thailand has more than 660 Japanese-brand restaurants.

"We believe that our sales target will be achieved as a result of the strong demand for Japanese food and the trend to consume healthy food," he said.

Somluck Srimalee

The Nation