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Published on April 23, 2008

Siriporn Chanjindamanee

The Nation

The company, which owns the brand names Siamgas and Unique Gas, holds a 25.7-per-cent share of the LPG market, after PTT. It is also involved in logistics services and LPG retail stations.

Managing director Supachai Weeraborwornpong said 20 million of the IPO shares would be allocated to the company's directors and staff. Forty to 50 per cent of the rest will be sold to trading partners, 20-30 per cent to general investors and 10-20 per cent to local and foreign institutional investors.

Proceeds from the IPO will be used to build another 20 LPG stations in Bangkok and its vicinity within the next three years. The company will also construct a depot and LPG filing plant in Vietnam, and the remaining proceeds will be used to service debts and will be reserved as working capital, he said.

The depot and LPG filing plant in Vietnam will cost Bt400 million and will come on stream later this year or early next year. The investment in Vietnam follows the company's aim to become a regional energy-related service provider, Supachai said.

KTB Securities, which is lead underwriter for the IPO, believes there is oversubscription demand, following an initial survey.

Managing director Chupong Tanasettakorn said the selling price would be finalised in mid-May and the stock would debut in early June.

Last year, Siamgas and Petro-chemicals' net profit rose 80 per cent, from Bt243 million in 2006 to Bt442.42 million.

The company expects its sales to grow by at least 10 per cent this year, from Bt14.9 billion last year, thanks to strong demand for LPG following global rises in oil prices. Its LPG sales volume is expected to exceed 1 million tonnes, after rising to 950,000 tonnes last year.

The company's gross margin rose to 8.53 per cent last year, from 6.95 per cent in 2006.

In the first three months of this year, its sales of LPG grew at a double-digit rate year on year, because motorists are shifting to LPG, the domestic price of which is well below that for petrol.

Despite the government's plan to lift its LPG price subsidy for the transportation and industrial sectors in July, Chupong said this would not have an effect on LPG demand, because the price would still be lower than that for petrol.