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Published on December 19, 2007

"The company's major shareholders were in talks with another broker about a merger and acquisition, but the negotiations failed," he said. "We do not have any plans to merge with others next year."

Early this year, it was widely reported that merger negotiations between Kim Eng Securities (Thailand) - the Kingdom's largest broker by share-trading volume - and Sicco Securities had failed. The latter then started talking with another unnamed broker.

Following the collapse of the negotiations, Sicco Securities will seek an executive partner to raise its market share back to 2 per cent, from 1.57 per cent now.

"The company will seek a foreign broker to become our executive partner, in order to help increase our number of foreign institutional customers. If we cannot sign a deal with an executive partner, it's possible we may be unable to achieve our market-share target. But the company is not in a hurry," Siripong said.

Retail investors make up 95 per cent of the company's total customers. The rest are local institutional investors.

Siripong said tougher competition in the brokerage business resulted in a shrinkage of Sicco Securities' market share from 2 per cent last year.

Despite the fall in its market share, the broker estimates its net profit this year will be greater than last year's Bt2 million.

"We posted a net profit of Bt7 million in the first nine months of this year, this year's revenue will be lower than last year's," he said.

Siripong explained that the company's relatively low net profit last year was due to its Bt16-million reserve provision after customers failed to pay for stock transactions.

He is optimistic that the company's revenue and net profit will improve next year on anticipation of a higher market share in the brokerage business.

The company plans to double its ratio of local institutional customers from 5 per cent this year to 10 per cent next year, he said.

Sicco Securities will also be involved in two initial public offering deals, in a bid to raise about Bt10 billion. One of the companies will seek a listing on the Stock Exchange of Thailand (SET) in next year's first half and the other in the second half, he said.

Taking into account a deal to raise funds through a property fund involving the Urbana Sathorn project, Sicco Securities' revenue contribution from investment banking will represent 3-4 per cent of the total, up from 2 per cent now.

In Sicco Securities' revenue structure, 80 per cent is generated from stock brokering, 10 per cent from derivatives trading and the rest from other sources.

Siriporn Chanjindamanee

   The Nation