SRITHAI SUPERWARE, Thailand's leading producer of melamine and plastic tableware, plans to invest Bt1.5 billion in expanding its business in India, Indonesia and Vietnam as its foresees strong demand in those markets, while expecting domestic sales to ac
Sanan Angubolkul, chairman and president of the listed company, said Srithai Superware would focus on expansion via new overseas factories this year in light of strong export growth to key target markets.
In expanding its business overseas, Sanan explained that the company would concentrate on building up its manufacturing presence largely via mergers and acquisitions, as such a strategy would enable it to generate income in the short run.
“As a result of or planned expansion abroad, our target is to double sales to Bt20 billion by 2020, from this year’s expected Bt10.05 billion. This year’s estimated sales will be 7 per cent higher than the value achieved in 2014, while volume will rise by 10 per cent. Also, sales from overseas investment will increase significantly compared to the Thai market,” he said.
Currently about 22 per cent of the firm’s sales are from direct exports, and 20 per cent from regional investment, mainly from Vietnam and Indonesia, while the remainder is from the domestic market.
Sanan said the share of the company’s income from overseas sales would increase over the next five years, under its firm strategy of focusing on expanding investment in other countries.
Income from its Vietnamese business is expected to exceed that generated in Thailand within the next 10 years, he added.
Under the investment plan, Srithai Superware will spend about Bt500 million in establishing a third Vietnamese factory, in the city of Hanoi.
The new plant is expected to start a test run with an annual capacity of 6,000 tonnes of plastic products in the fourth quarter of this year.
Srithai Superware currently has two plants for plastic products and bottle production in Ho Chi Minh City, with an annual capacity of about 20,000 tonnes.
In western India, the company will invest about Bt400 million to set up a new manufacturing facility for melamine products.
Rakesh Singh, Srithai Superware’s director, corporate strategy and operation development, said the company was now looking to focus more on the Indian market, due to high demand and the country’s strong economic growth.
“India is one of the highest-potential markets for expansion. India used to import a large amount of the company’s products. However, due to a high import tariff, the firm will now set up a manufacturing plant in the country,” he said.
In Indonesia, the company plans a business merger to establish a second manufacturing presence in the country, in Jakarta. Its current facility is located in Surabaya.