Ratchthani Leasing eyes expansion

Three banks - Siam City Bank (SCIB), Bank of Ayudhya and ACL Bank - yesterday provided a syndicated loan of Bt3.5 billion to the company.

Used cars make up 80 per cent of its leasing portfolio.

Ratchthani managing director Kovit Rongwattanasophon said the company would use 30 per cent of the four-year loan to service its debt. Another Bt10 million will be spent on upgrading the company's information technology and improving infrastructure, including adding a branch in Surat Thani province, its fifth one nationwide. The rest will be used to expand the business.

The full amount of the loan will be used this year. For further expansion next year, the company is waiting for a capital increase from parent SCIB, which owns 40 per cent of Ratchthani.

"Our financial adviser, Kim Eng Securities (Thailand), is studying the plan now and should be finished with it in the third quarter. Then the company will submit a proposal for the bank's consideration. The amount of any capital increase has not been decided yet," said Kovit.

He believes if the bank increases the company's capital, next year's performance will reflect aggressive growth, with as many as another 10 or even 15 branches added. In the first five months, the company lent Bt1.5 billion of its full-year target of Bt4.2 billion, up 16.67 per cent from last year's Bt3.6 billion.

Outstanding loans now stand at Bt5.4 billion, which is expected to increase to Bt7 billion by year-end.