Conwood, a manufacturer of products that look like, and replace, wood in buildings, will spend Bt400 million to Bt500 million next year to increase its production capacity - if the economy recovers.
Conwood is a subsidiary of Siam City Cement, the country's secondlargest cement manufacturer.
CEO Suthipan Wacharopas said the company had sufficient cash flow and good credit for borrowing from banks to finance the investment.
At present, Conwood has a production capacity of 90,000 tonnes a year and would like to increase it by another 45,000 tonnes a year, to serve both domestic and international markets.
It had planned to proceed with the plan this year, in conjunction with an aggressive exporting campaign covering mainly Asian markets. However, the plan was deferred, due to the gloomy economic conditions.
Suthipan believes the market for wood-replacement products will likely recover in this year's fourthe quarter, following signs of improvement in the real-estate industry.
"If the real-estate business recovers - like many business figures in this industry predict - and there is no violence in Thailand's political situation next year, we're possibly going to invest roughly Bt500 million to expand the company's capacity in 2010," he said.
The domestic market for woodreplacement products has not been good this year, in line with the realestate industry. Conwood's first-half revenue fell 3 per cent year on year, and despite the expected recovery in the fourth quarter, it expects revenue this year of Bt800 million, down slightly from last year.
Suthipan said Conwood earlier hoped export sales would boost its revenue this year, but the outlook in foreign markets is no better than that at home. Taiwan is Conwood's only new export market this year. It also exports to Vietnam, Malaysia, Indonesia and the Philippines.
Conwood maintains its target for foreign markets to contribute 12.5 per cent of expected revenue of Bt1.2 billion in 2012.
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