Mae Thong Suk group eyes Bt100 bn from spot gold sales

Kritcharat Hiruyasiri, president of the group, said gold spot trad¬ing accounted for 70 per cent of its revenues, with futures trading making up the rest.

Subsidiary HR Gold and Silver oversees the group's gold spot trading, while another unit - MTS Gold Futures - is responsible for gold futures trading and Mae Thong Suk for traditional gold outlets.

Kritcharat said skyrocketing global goldbar prices had attracted people to invest in the precious metal on the spot market.

Demand for gold ornaments last year fell 60 per cent from 2007 because people preferred to invest in gold bar.

Gold bar was one of the major items driving the country's export volume in the first two months of the year. Gold exports in the period totalled US$1.8 billion (Bt63.9 billion), of which $950 million were sales by the Mae Thong Suk Group.

"The revenue from gold spot trad¬ing in the first two months has ensured that our revenue from spot gold this year will reach Bt100 billion," he said.

Mae Thong Suk is a brokerage member for gold futures on the Thailand Futures Exchange (TFEX). The group established MTS Gold Futures for this purpose, with an investment of Bt120 million.

He said the group targeted a 30-per-cent share of the TFEX gold futures market.

Other gold futures brokerages on the exchange are YLG, Gold Traders Association of Thailand, Ausiris and Huasengheng.

Kritcharat said gold futures in Thailand might need more time to develop, as investors do not yet have sufficient experience in the market.

The company will hold roadshows in major cities to educate investors about trading in gold futures.

The trading volume of gold futures this year is expected to average 3,000 contracts a day, which is small. This should climb to 10,000 daily contracts next year, which is a suitable level for the Thai market, he said.

Nuttapong Hirunyasiri, managing director of MTS Gold Futures, said the company planned to have more 40 sales agents this year.

It will also invest Bt20 million in developing technology to support futures trading and for undertaking roadshows.