PCA gears up for MAI listing

Corporate June 07, 2014 00:00

By Erich Parpart
The Nation

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Firm bids to maintain growth momentum

Planet Communications Asia is preparing to enter the Market for Alternative Investment (MAI) with the aim of maintaining the company’s continuous growth and as support for its new set-top box venture. 
PCA president and chief executive officer Prapat Rathlertkarn said the company was now expecting growth of 40 per cent this year from its existing businesses in telecommunications, broadcast digital TV, sales of its own products and services, along with the new set-top box business.
“We expected growth of 20 per cent this year from our existing businesses, and with the new venture into STB business, we are now expecting [overall] growth of 40 per cent,” he said.
The company generated Bt744.42 million in revenue last year and made a net profit of Bt65.94 million.
The main reason for the company’s confidence about its growth prospects is the growing business in digital TV as a result of the recent switch from analogue broadcasting to the digital system, he added.
The telecommunications market in Thailand is worth Bt160 billion, with a growth rate of around 8-10 per cent from 2011 to 2013, said the company chief.
As for the set-top box business, Prapat said PCA aimed to hold at least 5-10 per cent of a market that is currently worth about Bt10 billion. 
In terms of competition within the telecoms market, he said: “Competition in the wireless market is still low since the market is small, but the wired market is quite competitive due to the high number of operators. But Planet Communication has a minimal amount of competitors since only a few companies offer the complete supply chain as we do, while the business risk is quite low because it is a specified business.” 
PCA provides services in the consultancy, development and implementation of satellite communication solutions for the public and private sectors.
It has registered capital of Bt250 million and paid-up capital of Bt175 million, which translates into 175 million shares. 
Net profit has grown by 40 per cent on average in the past three years, and the dividend pay-out per year is above 50 per cent of the net profit.
Ratana Suwan, executive vice president of PCA, said the company’s compound annual growth rate had grown by 11.54 per cent from revenue of Bt598.37 million in 2011 to Bt744.42 million last year. 
Net profit has expanded from Bt31.44 million to Bt65.49 million in the same period, and the company made a net profit of Bt12.59 million in the first quarter of this year. 
Return on investment 
The return on investment for shareholders is 23.53 per cent, with a debt per share of 1.39 times at the end of the first quarter, she said.
The company’s goal is to lower its dependency on trading other companies’ products, which now account for 83 per cent of revenue, said Prapat. 
The remainder comes from the sale of their own innovations such as mobile-phone signal jammers, after-sales and other services. 
It wants to change the income ratio from 83:17 to 60:40 in the next three years, and has set aside Bt25 million-Bt30 million for advertising and developing a brand name in order to achieve this target.
PCA also aims to lower its source of revenue from the public sector to 25 per cent of overall income from the current level of 30 per cent, in order to lower the risk from domestic political turbulence. 
“The money gained from the initial public offering will be used as working capital to support the growth of the company,” said the CEO.
PCA will list on the MAI at the end of this month. The company is offering 75 million shares at par value of Bt1 apiece to the general public for the first time. This is 30 per cent of its issued and paid-up ordinary shares.