Lactasoy earmarks Bt1.2 bn for capacity expansion in AEC era

Corporate October 08, 2015 01:00

By KWANCHAI RUNGFAPAISARN
THE NA

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LACTASOY, producer and distributor of Lactasoy UHT soy milk, yesterday announced an investment of about Bt1.2 billion in the establishment of two factories - one at its complex in Prachin Buri and the other in the Northeast.



The significant expansion is set to cater to dramatic growth in both domestic sales and exports, cashing in on the implementation of the Asean Economic Community (AEC) by the end of this year. 
The company’s current factory in Prachin Buri, located on a 200-rai (32 hectares) plot, has the capacity to produce about 2 billion packs of UHT soy milk per annum. 
Being a major ingredient in Lactasoy production, the company consumes between 40,000 and 50,000 tonnes of soy beans each year.
“We plan to invest Bt500 million in this second factory, to be located at our complex in Prachin Buri. The new factory, which will start operation in the second quarter of next year, will have an annual production capacity at around 1 billion packs and will give the company a total production capacity of 3 billion packs of UHT soy milk per year.
“As a result, we will be able to achieve the growth opportunity witnessed in the soy-milk market both in Thailand and beyond, especially in Asean [post-AEC implementation],” said Kamol Likitkanjanakul, general sales manager.

“The new second factory in Prachin Buri will allow the company to catch up with growth opportunity for the next two years without any limitation in terms of production capacity,” he added.
The company is also looking for a potential plot of around 100 rai in the Northeast for the establishment of a third factory, which would become operational after 2018.
“The facility would require an investment of between Bt600 million and Bt700 million, including land cost,” he said.
“We will use this third factory as our gateway to export Lactasoy soy milk to Asean, especially to the CLMV [Cambodia, Laos, Myanmar, and Vietnam] market,” he added.
Lactasoy exports its UHT soy milk to about 30 markets around the world, with shipments contributing 11 per cent of the company’s sales revenue. 
Exports to Asean – and to Laos, Cambodia and Myanmar, in particular – account for about 80 per cent of overall exports.
The company is looking to explore export opportunities in other Asean countries, especially Malaysia and the Philippines, which are markets with enriched-soy-milk consumption, he explained.
“We expect our annual sales to reach about Bt20 billion in the next five years, of which 30 per cent will be from exports,” said Kamol. 
With more and more people taking better care of themselves, the company believes the soy-milk market will continue to grow solidly each year. This year, the Thai market is anticipated to expand by 8 per cent to Bt18.5 billion. 
Lactasoy is currently the No-1 brand in the local market, with a 55-per-cent share.
“We have maintained our leadership status in Thailand’s soy-milk market for 10 consecutive years, with a notable increase in sales every year. This year, we expect to achieve 12-per-cent growth, which is higher than the overall market growth,” said the general sales manager.
Lactasoy expects overall sales of Bt11 billion this year, he added.
 

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