The building material, steel, downstream petrochemicals, auto parts and discountstore sectors will benfit from the government's second economic stimulus package, according to a research paper by SCB Securities.
Firms making building materials are expected to reap the biggest gains from the Thai Khemkhaeng (Invest for Strength) scheme phase I, worth Bt200 billion.
About Bt59 billion of the Bt200billion package will be used to develop small reservoirs and repair irrigation systems, and PVC manufacturers such as Thai Plastic and Chemicals and Vinythai will enjoy the benefits.
The brokerage said another Bt35 billion would be allocated for building and repairing roads, boosting asphalt demand and benefiting Tipco Asphalt.
Tata Steel (Thailand) and G Steel will also be beneficiaries from the stimulus package, as steel bar and wire will be major raw materials in construction works related to irrigation systems, hospitals and electric trains, SCB Securities said.
However, the brokerage is nor sure whether Sahaviriya Steel will also gain, as PVCpipe prices and maintenance costs are lower than those for steel pipelines.
Cement-makers Siam Cement, Siam City Cement and TPI Polene are other expected gainers in the buildingmaterials sector.
The brokerage estimates that the 10-12 electricrail routes will need 9 million10 million tonnes of cement.
"It is too early to calculate cement demand for all the routes, but the Purple, Red and Blue lines alone will create 2.53 million tonnes of cement consumption over their fouryear construction periods," the paper said.
For the consumption sector, Big C Supercentre and Siam Makro will be winners from the Thai Khemkhaeng programme, as about Bt20 billion will be allocated to village funds.
From the previous village funds' budget in fiscal years 20042005, Big C and Makro reported sales growth in existing branches at 3 per cent and 6 per cent, respectively. This is well above Big C's current performance of minus 2.5 per cent to positive growth of 3 per cent, and Makro's growth of 13 per cent.
Makro tends to receive greater benefits from such schemes than Big C as its products are more related to economic activities.
This said, SCB Securities recommends "buy" on Big C with a 12month target price of Bt55 based on the dividend discount model, and "sell" on Makro with a 12month target of Bt67.
However, as both firms will benefit from the government's economic stimulus measures, the brokerage will soon review its assumptions.
Given that the package will bolster economic activities in rural areas, the demand for pickups and tractors will increase, making Somboon Advanced Technology a winner.
The company is Thailand's largest axle-shaft manufacturer for pickups with a market share of 80 per cent. Moreover, it supplies shafts to Siam Kubota, the country's largest tractor producer.
The brokerage recommends "buy" for the stock, with a 12month target price of Bt13.
The government's plan to lower the ratio of students to computers from 38:1 to 20:1 will create demand for 200,000 PCs. IT City, the computer peripherals and equipment distributor, will therefore stand to gain.
For the consumption sector, Big C Supercentre and Siam Makro will be winners from the Thai Khemkhaeng programme, as about Bt20 billion will be allocated to village funds.
Wednesday, October 28, 2009
Thainox share sale rumoured to Posco
Thainox Stainless Plc, Southeast Asia's largest stainless steel producer, said yesterday that its top shareholder was in sale talks, stoking speculation of a possible $370-million sale to the world's sixth-largest steelmaker.
Thainox did not identify a possible buyer, but a source at the South Korean steelmaker Posco told Reuters on Wednesday that talks to buy a further stake in Thainox were in the final stages.
The Mahagitsiri Group, which owns 51.7% of Thainox and represents one of Thailand's richest families, was in talks for a possible sale of shares to an undisclosed party but was undecided, a stock exchange statement said.
Prayudh Mahagitsiri, the company's chairman and chief executive, and a key power-broker in the government led by deposed former prime minister Thaksin Shinawatra, declined to comment on the reports.
The news sent Thainox shares (INOX)up 11.5% to a four-year high of 1.65 baht in the morning session on the Stock Exchange of Thailand. The shares closed yesterday at 1.50 baht, up two satang, in trade worth 86.4 million baht. The stock has risen nearly 69% this year on speculation about a possible sale.
"We were informed that they are in the process of negotiation on the terms and conditions of the share sale transaction, and until now they have reached no conclusion," it said in the statement to the SET.
Posco had no official comment yesterday regarding the possible acquisition of Thainox Stainless Plc.
But an industry source close to the matter said:"If share prices are rising [as in the current situation], it will be hard for Posco to acquire Thainox."
Posco currently owns 15% of Thainox.Analysts say the South Korean steelmaker is seeking to acquire the Thai company to expand its cold-rolled coil capacity and overseas presence.
But any acquisition that raises Posco's stake to 25% or more would require it to offer to buy the remaining shares, according to Thai market regulations.
Earlier this week, Korean media quoted unidentified industry sources as saying Posco would buy 85% of Thainox for between 400-500 billion won ($342 million to $427.5 million). But the company source said that the rumoured acquisition prices were not correct.
Thainox did not identify a possible buyer, but a source at the South Korean steelmaker Posco told Reuters on Wednesday that talks to buy a further stake in Thainox were in the final stages.
The Mahagitsiri Group, which owns 51.7% of Thainox and represents one of Thailand's richest families, was in talks for a possible sale of shares to an undisclosed party but was undecided, a stock exchange statement said.
Prayudh Mahagitsiri, the company's chairman and chief executive, and a key power-broker in the government led by deposed former prime minister Thaksin Shinawatra, declined to comment on the reports.
The news sent Thainox shares (INOX)up 11.5% to a four-year high of 1.65 baht in the morning session on the Stock Exchange of Thailand. The shares closed yesterday at 1.50 baht, up two satang, in trade worth 86.4 million baht. The stock has risen nearly 69% this year on speculation about a possible sale.
"We were informed that they are in the process of negotiation on the terms and conditions of the share sale transaction, and until now they have reached no conclusion," it said in the statement to the SET.
Posco had no official comment yesterday regarding the possible acquisition of Thainox Stainless Plc.
But an industry source close to the matter said:"If share prices are rising [as in the current situation], it will be hard for Posco to acquire Thainox."
Posco currently owns 15% of Thainox.Analysts say the South Korean steelmaker is seeking to acquire the Thai company to expand its cold-rolled coil capacity and overseas presence.
But any acquisition that raises Posco's stake to 25% or more would require it to offer to buy the remaining shares, according to Thai market regulations.
Earlier this week, Korean media quoted unidentified industry sources as saying Posco would buy 85% of Thainox for between 400-500 billion won ($342 million to $427.5 million). But the company source said that the rumoured acquisition prices were not correct.
SIAM MORTAR TO SPEND UP TO BT700M ON CAPACITY BOOST
Siam Mortar, a construction-materials unit of Siam Cement Group, is planning to invest Bt600 million to Bt700 million to boost its annual production capacity of ready-to-use mortar by 500,000 tonnes by 2011.
The expansion is expected to serve its future growth of 20-25 per cent per year, despite shrinking demand in the overall cement market.
Managing director Rewat Suriyapananont said Siam Mortar currently operated at 80 per cent of production capacity of 1.3 million tonnes per year. It has three production plants, of which two are
located in Saraburi and the other in Nakhon Si Thammarat.
"We need to expand our production capacity and conduct aggressive marketing strategies if we plan to double our sales in five years," he said.
The new plant could be located in the central region, where demand is high, he added.
Although overall cement consumption is expected to fall by 5 per cent this year, Rewat is confident his firm's mortar sales will maintain growth of 10-15 per cent to 1 million tonnes thanks to high-quality products and innovative solutions for customers.
"Even though our sales growth is increasing, the growth in 2009 will still be lower than the [average] 20-25 per cent over the past five to six years, as a result of the economic slowdown. However, we believe that our sales growth will rise to 20 per cent next year, since property developers have returned to proceeding with their incomplete projects in big cities like Phuket," he said.
About 80 per cent of Siam Mortar's sales are from big property projects, with the remainder generated by private houses and the house-renovation market.
"Since the economic crisis erupted, we realised we should focus more on the private housing market. Despite a small volume of cement demand, it has more sustainable growth than large property projects," he said.
Hence, the company plans to change the sales proportion to generate 40 per cent of sales from property projects and 60 per cent from private housing and the renovation market.
He said the future trend of the cement market would be to develop eco-friendly products that would be good for both the environment and inhabitants' health.
"SCG Cement has allocated a budget of Bt200 million for research and development each year, because we will change ourselves from a cement-maker to a solution provider. For example, we will not only sell cement but also wall and floor systems in the future, in order to better utilise customers' budget and time," he added.
Presently, the total market for mortar cement is worth about Bt2 billion, with a volume of 2 million tonnes per year. It is predicted to expand by 10 per cent this year.
Siam Mortar has a 50-per-cent share of the market, followed by TPI Polene with 40 per cent and Siam City Cement with 10 per cent.
The expansion is expected to serve its future growth of 20-25 per cent per year, despite shrinking demand in the overall cement market.
Managing director Rewat Suriyapananont said Siam Mortar currently operated at 80 per cent of production capacity of 1.3 million tonnes per year. It has three production plants, of which two are
located in Saraburi and the other in Nakhon Si Thammarat.
"We need to expand our production capacity and conduct aggressive marketing strategies if we plan to double our sales in five years," he said.
The new plant could be located in the central region, where demand is high, he added.
Although overall cement consumption is expected to fall by 5 per cent this year, Rewat is confident his firm's mortar sales will maintain growth of 10-15 per cent to 1 million tonnes thanks to high-quality products and innovative solutions for customers.
"Even though our sales growth is increasing, the growth in 2009 will still be lower than the [average] 20-25 per cent over the past five to six years, as a result of the economic slowdown. However, we believe that our sales growth will rise to 20 per cent next year, since property developers have returned to proceeding with their incomplete projects in big cities like Phuket," he said.
About 80 per cent of Siam Mortar's sales are from big property projects, with the remainder generated by private houses and the house-renovation market.
"Since the economic crisis erupted, we realised we should focus more on the private housing market. Despite a small volume of cement demand, it has more sustainable growth than large property projects," he said.
Hence, the company plans to change the sales proportion to generate 40 per cent of sales from property projects and 60 per cent from private housing and the renovation market.
He said the future trend of the cement market would be to develop eco-friendly products that would be good for both the environment and inhabitants' health.
"SCG Cement has allocated a budget of Bt200 million for research and development each year, because we will change ourselves from a cement-maker to a solution provider. For example, we will not only sell cement but also wall and floor systems in the future, in order to better utilise customers' budget and time," he added.
Presently, the total market for mortar cement is worth about Bt2 billion, with a volume of 2 million tonnes per year. It is predicted to expand by 10 per cent this year.
Siam Mortar has a 50-per-cent share of the market, followed by TPI Polene with 40 per cent and Siam City Cement with 10 per cent.
Tuesday, October 20, 2009
Aussie firm shifts to Phuket
Australia-based swimming pool producer Autumn Solar Pty Ltd will shift its manufacturing base to Phuket to benefit from the Asean Free Trade Area.
The relocation involves a joint-venture with a local pool producer and investment of 50 million baht.
Managing director Steve Merrett said the move from Ulladulla, a coastal town in New South Wales, Australia, to Phuket would help reduce manufacturing costs by 15% to 20% due to lower wages,cheaper raw materials and savings in transportation costs.
The relocation would start this month by moving salt chlorination system production. Full production would be completed within two years when it will close its factory in Australia, he said.
The firm also plans to close a plastics factory in China which will shift to the new centre in Phuket, he said.
"It's an opportunity to have Thailand as our manufacturing base," he said."We can import materials from Australia with zero tax and export the products to China, our main market, and the rest of the world without tax as well."
The firm currently exports 90% of the equipment made at the Ulladulla plant to China, Thailand, Vietnam, Europe and the US. Autumn Solar had a turnover of US$55 million last year, he said.
The company yesterday announced a joint venture with JD Pools 2004(Thailand) which will establish a firm with registered capital of 50 million baht.
Thanusak Phungdet, chief executive of JD Pools, said the firm's factory in Phuket would double to 10,000 square metres with Autumn Solar's relocation.
The company plans to increase its exports from 20% of production to 50%in three years. It targets annual sales of 1 billion baht with the joint venture.
The Thai pool market this year is estimated at about 2 billion baht, up 10%to 15% on last year. JD Pools expects sales of 600 million baht this year, up 12% on 2008 but below its 15% target.
The relocation involves a joint-venture with a local pool producer and investment of 50 million baht.
Managing director Steve Merrett said the move from Ulladulla, a coastal town in New South Wales, Australia, to Phuket would help reduce manufacturing costs by 15% to 20% due to lower wages,cheaper raw materials and savings in transportation costs.
The relocation would start this month by moving salt chlorination system production. Full production would be completed within two years when it will close its factory in Australia, he said.
The firm also plans to close a plastics factory in China which will shift to the new centre in Phuket, he said.
"It's an opportunity to have Thailand as our manufacturing base," he said."We can import materials from Australia with zero tax and export the products to China, our main market, and the rest of the world without tax as well."
The firm currently exports 90% of the equipment made at the Ulladulla plant to China, Thailand, Vietnam, Europe and the US. Autumn Solar had a turnover of US$55 million last year, he said.
The company yesterday announced a joint venture with JD Pools 2004(Thailand) which will establish a firm with registered capital of 50 million baht.
Thanusak Phungdet, chief executive of JD Pools, said the firm's factory in Phuket would double to 10,000 square metres with Autumn Solar's relocation.
The company plans to increase its exports from 20% of production to 50%in three years. It targets annual sales of 1 billion baht with the joint venture.
The Thai pool market this year is estimated at about 2 billion baht, up 10%to 15% on last year. JD Pools expects sales of 600 million baht this year, up 12% on 2008 but below its 15% target.
Wednesday, October 14, 2009
Starmark eyes 10% growth
Starmark Co, a manufacturer of kitchen fittings, is maintaining its 10% sales growth target this year on the back of improving sentiment among both project developers and retail clients, said managing director Nantana Srisakulpinyo.
Fourth-quarter sales in the local furniture market are set to improve with a better economic outlook coupled with the approaching high season for furniture purchases, said Ms Nantana.
"Project clients have regained their confidence in investment and next year we expect the number of residential projects we're going to deal with will increase by 15% from this year," she said.
Project clients account for about 60%of sales and retail buyers 40%. But Starmark plans to boost the contribution of retail clients to 45% of sales next year as the segment has ample room to grow and also provides a better sales margin.
Spending per individual on Starmark kitchen fittings is estimated at about 150,000 to 200,000 baht.
Currently, Starmark has 45 retail outlets nationwide. It plans to add three next year, including one at Crystal Design Center.
The kitchen furniture market in Thailand has been growing at about 10% to 15% each year for the past three to five years as many international brands have continued to enter the market, said Ms Nantana.
Local furniture manufacturers are also investing more in the kitchen furniture segment as consumers are paying increasing attention to kitchen design and decoration, she added.
The company yesterday launched the "New Hygienic Thai Kitchen 2010" kitchen fittings series to tap demand for Thai-style cooking.
Fourth-quarter sales in the local furniture market are set to improve with a better economic outlook coupled with the approaching high season for furniture purchases, said Ms Nantana.
"Project clients have regained their confidence in investment and next year we expect the number of residential projects we're going to deal with will increase by 15% from this year," she said.
Project clients account for about 60%of sales and retail buyers 40%. But Starmark plans to boost the contribution of retail clients to 45% of sales next year as the segment has ample room to grow and also provides a better sales margin.
Spending per individual on Starmark kitchen fittings is estimated at about 150,000 to 200,000 baht.
Currently, Starmark has 45 retail outlets nationwide. It plans to add three next year, including one at Crystal Design Center.
The kitchen furniture market in Thailand has been growing at about 10% to 15% each year for the past three to five years as many international brands have continued to enter the market, said Ms Nantana.
Local furniture manufacturers are also investing more in the kitchen furniture segment as consumers are paying increasing attention to kitchen design and decoration, she added.
The company yesterday launched the "New Hygienic Thai Kitchen 2010" kitchen fittings series to tap demand for Thai-style cooking.
Sunday, October 11, 2009
China opposes US anti-dumping probe of steel pipes
Beijing is rejecting a move by Washington to launch an investigation into whether Chinese mills are dumping steel pipes on the US market or benefiting unfairly from government subsidies.
The probe comes as the United States and China accuse each other of protectionism, which both say will hurt efforts to end the global economic crisis.
"Blind accusations of dumping or sub-sidies in Chinese imports is lacking in factual basis, which China strongly opposes," China's Commerce Ministry said in a statement on its website on Saturday.
The statement said the problems in the American steel industry were brought on by weakened demand and should not be blamed on Chinese imports.
The US Department of Commerce last week started investigating at the request of US steel manufacturers, who say Chinese manufacturers have sold steel pipe at prices below the cost of production - a practice known as dumping - and have benefited from massive government subsidies.
US manufacturers want tariffs placed on the Chinese imports to offset the alleged subsidies.
President Barack Obama recently ap-proved higher tariffs on US imports of Chinese-made tires to slow the rapid growth of imports that a labour union has blamed for the loss of thousands of American jobs. Beijing filed a World Trade Organisation challenge to Washington's decision. The two also are involved in disputes over access to each other's markets for poultry, paper, music and movies.
The probe comes as the United States and China accuse each other of protectionism, which both say will hurt efforts to end the global economic crisis.
"Blind accusations of dumping or sub-sidies in Chinese imports is lacking in factual basis, which China strongly opposes," China's Commerce Ministry said in a statement on its website on Saturday.
The statement said the problems in the American steel industry were brought on by weakened demand and should not be blamed on Chinese imports.
The US Department of Commerce last week started investigating at the request of US steel manufacturers, who say Chinese manufacturers have sold steel pipe at prices below the cost of production - a practice known as dumping - and have benefited from massive government subsidies.
US manufacturers want tariffs placed on the Chinese imports to offset the alleged subsidies.
President Barack Obama recently ap-proved higher tariffs on US imports of Chinese-made tires to slow the rapid growth of imports that a labour union has blamed for the loss of thousands of American jobs. Beijing filed a World Trade Organisation challenge to Washington's decision. The two also are involved in disputes over access to each other's markets for poultry, paper, music and movies.
Friday, October 9, 2009
Thainox share sale rumoured to Posco
Thainox Stainless Plc, Southeast Asia's largest stainless steel producer, said yesterday that its top shareholder was in sale talks, stoking speculation of a possible $370-million sale to the world's sixth-largest steelmaker.
Thainox did not identify a possible buyer, but a source at the South Korean steelmaker Posco told Reuters on Wednesday that talks to buy a further stake in Thainox were in the final stages.
The Mahagitsiri Group, which owns 51.7% of Thainox and represents one of Thailand's richest families, was in talks for a possible sale of shares to an undisclosed party but was undecided, a stock exchange statement said.
Prayudh Mahagitsiri, the company's chairman and chief executive, and a key power-broker in the government led by deposed former prime minister Thaksin Shinawatra, declined to comment on the reports.
The news sent Thainox shares (INOX)up 11.5% to a four-year high of 1.65 baht in the morning session on the Stock Exchange of Thailand. The shares closed yesterday at 1.50 baht, up two satang, in trade worth 86.4 million baht. The stock has risen nearly 69% this year on speculation about a possible sale.
"We were informed that they are in the process of negotiation on the terms and conditions of the share sale transaction, and until now they have reached no conclusion," it said in the statement to the SET.
Posco had no official comment yesterday regarding the possible acquisition of Thainox Stainless Plc.
But an industry source close to the matter said:"If share prices are rising [as in the current situation], it will be hard for Posco to acquire Thainox."
Posco currently owns 15% of Thainox.Analysts say the South Korean steelmaker is seeking to acquire the Thai company to expand its cold-rolled coil capacity and overseas presence.
But any acquisition that raises Posco's stake to 25% or more would require it to offer to buy the remaining shares, according to Thai market regulations.
Earlier this week, Korean media quoted unidentified industry sources as saying Posco would buy 85% of Thainox for between 400-500 billion won ($342 million to $427.5 million). But the company source said that the rumoured acquisition prices were not correct.
Based on a market price of 1.57 baht,the value of Thainox's remaining 85%stake is about 12.24 billion baht.
Thainox has 300,000 tonnes of capacity and exports 40% of its output to Europe and other overseas markets.
Thainox did not identify a possible buyer, but a source at the South Korean steelmaker Posco told Reuters on Wednesday that talks to buy a further stake in Thainox were in the final stages.
The Mahagitsiri Group, which owns 51.7% of Thainox and represents one of Thailand's richest families, was in talks for a possible sale of shares to an undisclosed party but was undecided, a stock exchange statement said.
Prayudh Mahagitsiri, the company's chairman and chief executive, and a key power-broker in the government led by deposed former prime minister Thaksin Shinawatra, declined to comment on the reports.
The news sent Thainox shares (INOX)up 11.5% to a four-year high of 1.65 baht in the morning session on the Stock Exchange of Thailand. The shares closed yesterday at 1.50 baht, up two satang, in trade worth 86.4 million baht. The stock has risen nearly 69% this year on speculation about a possible sale.
"We were informed that they are in the process of negotiation on the terms and conditions of the share sale transaction, and until now they have reached no conclusion," it said in the statement to the SET.
Posco had no official comment yesterday regarding the possible acquisition of Thainox Stainless Plc.
But an industry source close to the matter said:"If share prices are rising [as in the current situation], it will be hard for Posco to acquire Thainox."
Posco currently owns 15% of Thainox.Analysts say the South Korean steelmaker is seeking to acquire the Thai company to expand its cold-rolled coil capacity and overseas presence.
But any acquisition that raises Posco's stake to 25% or more would require it to offer to buy the remaining shares, according to Thai market regulations.
Earlier this week, Korean media quoted unidentified industry sources as saying Posco would buy 85% of Thainox for between 400-500 billion won ($342 million to $427.5 million). But the company source said that the rumoured acquisition prices were not correct.
Based on a market price of 1.57 baht,the value of Thainox's remaining 85%stake is about 12.24 billion baht.
Thainox has 300,000 tonnes of capacity and exports 40% of its output to Europe and other overseas markets.
Wednesday, October 7, 2009
POSCO "MULLS SNAPPING UP REMAINDER OF THAINOX"
Pasco, Soth Korea's biggest steelmaker, is considering buying up to 85 per cent of Thailand's Thainox Stainless in a deal that could be worth as much as US$428 million (Bt14.3 billion), according to a Bloomberg report.
prayuth Mahakijsiri, a major shreholder of Thainox, declined to comment when contacted by The Nation yesterday.
However, Choi Doo Jin, a Posco spokesman, said details such as price and the size of the stake in the Thai company had not yet been decided.
Posco, which already owns 15 per cent of Thainox, may invest up to as much as 500 billion won in the firm for the remainder of the shares, the Korea Economic Daily reported on its website.
The South Korean company is expected to sign a preliminary agreement this month as it is negotiating the price with thai shareholders, the report said.
Prayuth, who also has sizeable interests in the coffee industry and other businesses, branched into the stainless-steel industry more than a decade ago.
In the second quarter, Thainox posted a consolidated net profit of Bt221.03 million, down from Bt311.75 million in the same period last year.
It posted a net loss of Bt240.06 million for the first six months of the year against a net profit of Bt682.94 million for the same period last year.
As of last April, Prayuth and his family controlled more than 54 per cent of Thainox, which booked a consolidated net loss of Bt1.16 billion in 2008, against a consolidated net profit of Bt134.08 million in 2007.
Late last year, employees of Thainox staged a protest over changes to their pay and welfare as they were asked to sign new contracts which substantially cut welfare and bonus payments.
Steel companies have been hit by a sharp decline in prices, along with those of other metals.
prayuth Mahakijsiri, a major shreholder of Thainox, declined to comment when contacted by The Nation yesterday.
However, Choi Doo Jin, a Posco spokesman, said details such as price and the size of the stake in the Thai company had not yet been decided.
Posco, which already owns 15 per cent of Thainox, may invest up to as much as 500 billion won in the firm for the remainder of the shares, the Korea Economic Daily reported on its website.
The South Korean company is expected to sign a preliminary agreement this month as it is negotiating the price with thai shareholders, the report said.
Prayuth, who also has sizeable interests in the coffee industry and other businesses, branched into the stainless-steel industry more than a decade ago.
In the second quarter, Thainox posted a consolidated net profit of Bt221.03 million, down from Bt311.75 million in the same period last year.
It posted a net loss of Bt240.06 million for the first six months of the year against a net profit of Bt682.94 million for the same period last year.
As of last April, Prayuth and his family controlled more than 54 per cent of Thainox, which booked a consolidated net loss of Bt1.16 billion in 2008, against a consolidated net profit of Bt134.08 million in 2007.
Late last year, employees of Thainox staged a protest over changes to their pay and welfare as they were asked to sign new contracts which substantially cut welfare and bonus payments.
Steel companies have been hit by a sharp decline in prices, along with those of other metals.
Tuesday, October 6, 2009
SCG mortar unit commits B700m to expansion
Siam Cement Group (SCG), the country's biggest industrial conglomerate, expects to invest about 700 million baht to lift its production capacity of ready-to-use cement to 2 million tonnes within two years.
The plan is being considered after Siam Mortar Co, a building materials unit of SCG, has increased its market share in ready-to-use mortar to 50%through sales of 500,000 tonnes in the first six months.
The company targets sales of one billion baht in 2009 and aims to double the figure within five years, said managing director Rewat Suriyapananont.
"We are currently utilising 80% of the plant's capacity which totals 1.3 million tonnes per year," he said, adding that it had three manufacturing plants, two in Saraburi and another in Nakhon Sri Thammarat.
"We aim to increase yearly capacity to between 1.8 million and 2 million tonnes within two years. The construction is likely to start early next year."
Mr Rewat said Siam Mortar would likely to expand the capacity at the Saraburi site. The company is also considering other locations to build a new plant somewhere near Bangkok, where mortar demand is substantial, or in the eastern and southern regions, he said.
"We have seen demand picking up substantially. Several hotel, resort and condominium projects in Phuket, for example, have resumed construction in the current quarter after they were suspended in the first half," said Mr Rewat.
"The current market rebound prompts us to believe that the market will come back quickly next year with expected growth of 20% over this year."
The overall ready-to-use mortar market is projected at 2 billion baht this year with sales volume of 2 million tonnes,an increase of 10% from 2008.
Sales of Siam Mortar rose 15% over the first half and its share rose to 50%from 40% in the same period last year.
TPI Polene is second in the segment with a 30% share and and Siam City Cement's Insee brand third with 10%.
To maintain its leading position, Mr Rewat said Siam Mortar would step up the launches of innovative products and services such as hygienic mortar. Also,the company aims to transform itself from a manufacturer of mortar to a full solution provider, he said.
Environmentally friendly products developed in line with SCG's Eco Value principle will also be in focus, he said.
"Green products are currently in high demand and we expect also in the year to come because of concerns over global warming," Mr Rewat said.
Shares of Siam Cement (SCC) closed on Friday on the Stock Exchange of Thailand at 220 baht, down three baht, in trade worth 586 million baht.
The plan is being considered after Siam Mortar Co, a building materials unit of SCG, has increased its market share in ready-to-use mortar to 50%through sales of 500,000 tonnes in the first six months.
The company targets sales of one billion baht in 2009 and aims to double the figure within five years, said managing director Rewat Suriyapananont.
"We are currently utilising 80% of the plant's capacity which totals 1.3 million tonnes per year," he said, adding that it had three manufacturing plants, two in Saraburi and another in Nakhon Sri Thammarat.
"We aim to increase yearly capacity to between 1.8 million and 2 million tonnes within two years. The construction is likely to start early next year."
Mr Rewat said Siam Mortar would likely to expand the capacity at the Saraburi site. The company is also considering other locations to build a new plant somewhere near Bangkok, where mortar demand is substantial, or in the eastern and southern regions, he said.
"We have seen demand picking up substantially. Several hotel, resort and condominium projects in Phuket, for example, have resumed construction in the current quarter after they were suspended in the first half," said Mr Rewat.
"The current market rebound prompts us to believe that the market will come back quickly next year with expected growth of 20% over this year."
The overall ready-to-use mortar market is projected at 2 billion baht this year with sales volume of 2 million tonnes,an increase of 10% from 2008.
Sales of Siam Mortar rose 15% over the first half and its share rose to 50%from 40% in the same period last year.
TPI Polene is second in the segment with a 30% share and and Siam City Cement's Insee brand third with 10%.
To maintain its leading position, Mr Rewat said Siam Mortar would step up the launches of innovative products and services such as hygienic mortar. Also,the company aims to transform itself from a manufacturer of mortar to a full solution provider, he said.
Environmentally friendly products developed in line with SCG's Eco Value principle will also be in focus, he said.
"Green products are currently in high demand and we expect also in the year to come because of concerns over global warming," Mr Rewat said.
Shares of Siam Cement (SCC) closed on Friday on the Stock Exchange of Thailand at 220 baht, down three baht, in trade worth 586 million baht.
GOING GREEN IS THE NEW MANTRA FOR DESIGNERS
In a bid to curb global warming, design trends in residnetial and office buildings are in creasingly espousing the green concept.
Property developers as well as construction materials manufacturers are laying greater emphasis on green enviroment.
A survey by The Nation on design trends showed that residential and commercial building owners are most concerned about environmental safety. As a result, architects and interior designers are creating buildings that ensure energy savings, wiht the construction desigh matching interior design to reduce energy consumption.
Supalai's palai's president, Prateep Tangmatitham, said the company takes concerns about the environment into account when designing both low-rise and high-rise residences. While designing, the direction of the building is given special emphasis,taking into account wind a d light.
The company also selects the consturction raw materials that help to reduce energy consumption such as green glass, double wall and roftile syste,.
LPN Development managing director Opas Sripayak said that most of the company's residential projects are now designed environ mentally friendly and int eh process it helps its customers save money on electricity.
"Our buildings will cut the electirc bills of our customers on an average by 10 to 20 per cent when compared with the residents tha use the normal system"he said
SCG Building Materials, a subsidiary of SCG Group, teamed up with Japanese company Sekisui Chemical to launch an innovative Modular home Technology.
SCG Building Materials president Pichit Maipoom said the company's continuous study of cliential projects are now designed environmentally friendly and int eh process it helps its customers save money on electricity.
"Our buildings will cut the electirc bills of our customers on an average by 10 to 20 per cent when compared with the residents that use the normal system," he said.
SCG Building Materials, a subsidiary of SCG Grooup, teamed up with Japanese company Sekisui chemical to launch an innovative Modular Home Technology.
SCG Building Materials president Pichit Maipoom said the company's continuous study of cliental behaviour and house-related needs found that customers wanted quality both in construction materials and construction as well as good quality of life. "A good house should be convenient, clean, safe, and worthy of the life cycle cost."
In responding to these needs,pichit said the company would provide a comprehensive house service system through its collaboration with Sekisui Chemical, the leading Japanese company specialising in the housing business for more than 30 years and the laargest manufecturer of modular Home.
Sekisui will introduce a distinctive and advanced Modular Home
technology for the first time in Thailand.
"Combined with SCG's good qualtity building materials, it will produce a good quality house that genuiely meets and understands cistp,ers
de,amds" he said.
The innovative Modular Home Technology will be called "SCGHEIM".
Unlike other house-building technologies, the Modular Home offers an innovative creation in which more than 80 per cent of house components are produced in the factory and assembled into modules ready to be installed on site in a couple of days.
Besides, the house is designed for energy-efficiency with life cycle cost for a period of 30 years.
Following the energy-saving concept, SCG-HEIM houses install insulation around the house and air tightness to fill in spaces between joints of the house to keep the room temperature between 25 and 29 degrees Celsius. Air Factory is installed to ensure indoor air purification and consistent flow of air,which in turn will help save power from the use of air-conditioners.
Most home-owners these days have the energy-saving concept in mind when spending on renovation.
Home-owner Wichart, 40, has saved 10.38 per cent on energy consumption, or 863 units of electricity per year, after the building was renovated for energy efficiency.
The refurbishment not only saves money (about Bt3,020 per year based on a cost of Bt3.50 per unit), nut also creates better living conditions and a healthier environment by reducing greenhouse-gas emissions.
One principle that must be accepted in such conversions, how wever, is that upfront investm4nt is often steep but offers generous returns over time. The core ideas are stopping the incursion of hot air into living spaces, changing habits and using energy-saving electrical appliances.
Installing aluminium foil and fibreglass insulatijon is the most efficient way to cut electricity bills,because this can prevent a build-up of heat. Where the insulation should be installed depends on the home owner's budget.
Those on a very tight budget should perhaps limit the installation of fibreglass insulation to the attic,because that is directly heated by the sun. Those who can afford it, should install insulation not only in the attic,nut also in ceilings and walls, particularly in rooms with air-conditioning, because it can prevent heat flow and reduce cooling costs.
Importantly,insulation at least3 inches thick is recommended for hot countries like Thailand. Layers of lesser thickness are ot as energy efficient.
The latest innovation in construction raw materials helps home owners to save costs although they have to pay a higher price for energy-saving raw materials. But in the long term, they can cut their cost of living than by using normal products. As a result, companies have to develop innovative products to sefrve the change in customer demand, Pichit said.
Property developers as well as construction materials manufacturers are laying greater emphasis on green enviroment.
A survey by The Nation on design trends showed that residential and commercial building owners are most concerned about environmental safety. As a result, architects and interior designers are creating buildings that ensure energy savings, wiht the construction desigh matching interior design to reduce energy consumption.
Supalai's palai's president, Prateep Tangmatitham, said the company takes concerns about the environment into account when designing both low-rise and high-rise residences. While designing, the direction of the building is given special emphasis,taking into account wind a d light.
The company also selects the consturction raw materials that help to reduce energy consumption such as green glass, double wall and roftile syste,.
LPN Development managing director Opas Sripayak said that most of the company's residential projects are now designed environ mentally friendly and int eh process it helps its customers save money on electricity.
"Our buildings will cut the electirc bills of our customers on an average by 10 to 20 per cent when compared with the residents tha use the normal system"he said
SCG Building Materials, a subsidiary of SCG Group, teamed up with Japanese company Sekisui Chemical to launch an innovative Modular home Technology.
SCG Building Materials president Pichit Maipoom said the company's continuous study of cliential projects are now designed environmentally friendly and int eh process it helps its customers save money on electricity.
"Our buildings will cut the electirc bills of our customers on an average by 10 to 20 per cent when compared with the residents that use the normal system," he said.
SCG Building Materials, a subsidiary of SCG Grooup, teamed up with Japanese company Sekisui chemical to launch an innovative Modular Home Technology.
SCG Building Materials president Pichit Maipoom said the company's continuous study of cliental behaviour and house-related needs found that customers wanted quality both in construction materials and construction as well as good quality of life. "A good house should be convenient, clean, safe, and worthy of the life cycle cost."
In responding to these needs,pichit said the company would provide a comprehensive house service system through its collaboration with Sekisui Chemical, the leading Japanese company specialising in the housing business for more than 30 years and the laargest manufecturer of modular Home.
Sekisui will introduce a distinctive and advanced Modular Home
technology for the first time in Thailand.
"Combined with SCG's good qualtity building materials, it will produce a good quality house that genuiely meets and understands cistp,ers
de,amds" he said.
The innovative Modular Home Technology will be called "SCGHEIM".
Unlike other house-building technologies, the Modular Home offers an innovative creation in which more than 80 per cent of house components are produced in the factory and assembled into modules ready to be installed on site in a couple of days.
Besides, the house is designed for energy-efficiency with life cycle cost for a period of 30 years.
Following the energy-saving concept, SCG-HEIM houses install insulation around the house and air tightness to fill in spaces between joints of the house to keep the room temperature between 25 and 29 degrees Celsius. Air Factory is installed to ensure indoor air purification and consistent flow of air,which in turn will help save power from the use of air-conditioners.
Most home-owners these days have the energy-saving concept in mind when spending on renovation.
Home-owner Wichart, 40, has saved 10.38 per cent on energy consumption, or 863 units of electricity per year, after the building was renovated for energy efficiency.
The refurbishment not only saves money (about Bt3,020 per year based on a cost of Bt3.50 per unit), nut also creates better living conditions and a healthier environment by reducing greenhouse-gas emissions.
One principle that must be accepted in such conversions, how wever, is that upfront investm4nt is often steep but offers generous returns over time. The core ideas are stopping the incursion of hot air into living spaces, changing habits and using energy-saving electrical appliances.
Installing aluminium foil and fibreglass insulatijon is the most efficient way to cut electricity bills,because this can prevent a build-up of heat. Where the insulation should be installed depends on the home owner's budget.
Those on a very tight budget should perhaps limit the installation of fibreglass insulation to the attic,because that is directly heated by the sun. Those who can afford it, should install insulation not only in the attic,nut also in ceilings and walls, particularly in rooms with air-conditioning, because it can prevent heat flow and reduce cooling costs.
Importantly,insulation at least3 inches thick is recommended for hot countries like Thailand. Layers of lesser thickness are ot as energy efficient.
The latest innovation in construction raw materials helps home owners to save costs although they have to pay a higher price for energy-saving raw materials. But in the long term, they can cut their cost of living than by using normal products. As a result, companies have to develop innovative products to sefrve the change in customer demand, Pichit said.
SIAM MORTAR TO SPEND UP TO BT700M ON CAPACITY BOOST
Siam Mortar, a construction-materials unit of Siam Cement Group, is planning to invest Bt600 million to Bt700 million to boost its annual production capacity of ready-to-use mortar by 500,000 tonnes by 2011.
The expansion is expected to serve its future growth of 20-25 per cent per year, despite shrinking demand in the overall cement market.
Managing director Rewat Suriyapananont said Siam Mortar currently operated at 80 per cent of production capacity of 1.3 million tonnes per year. It has three production plants, of which two are
located in Saraburi and the other in Nakhon Si Thammarat.
"We need to expand our production capacity and conduct aggressive marketing strategies if we plan to double our sales in five years," he said.
The new plant could be located in the central region, where demand is high, he added.
Although overall cement consumption is expected to fall by 5 per cent this year, Rewat is confident his firm's mortar sales will maintain growth of 10-15 per cent to 1 million tonnes thanks to high-quality products and innovative solutions for customers.
"Even though our sales growth is increasing, the growth in 2009 will still be lower than the [average] 20-25 per cent over the past five to six years, as a result of the economic slowdown. However, we believe that our sales growth will rise to 20 per cent next year, since property developers have returned to proceeding with their incomplete projects in big cities like Phuket," he said.
About 80 per cent of Siam Mortar's sales are from big property projects, with the remainder generated by private houses and the house-renovation market.
"Since the economic crisis erupted, we realised we should focus more on the private housing market. Despite a small volume of cement demand, it has more sustainable growth than large property projects," he said.
Hence, the company plans to change the sales proportion to generate 40 per cent of sales from property projects and 60 per cent from private housing and the renovation market.
He said the future trend of the cement market would be to develop eco-friendly products that would be good for both the environment and inhabitants' health.
"SCG Cement has allocated a budget of Bt200 million for research and development each year, because we will change ourselves from a cement-maker to a solution provider. For example, we will not only sell cement but also wall and floor systems in the future, in order to better utilise customers' budget and time," he added.
Presently, the total market for mortar cement is worth about Bt2 billion, with a volume of 2 million tonnes per year. It is predicted to expand by 10 per cent this year.
Siam Mortar has a 50-per-cent share of the market, followed by TPI Polene with 40 per cent and Siam City Cement with 10 per cent.
The expansion is expected to serve its future growth of 20-25 per cent per year, despite shrinking demand in the overall cement market.
Managing director Rewat Suriyapananont said Siam Mortar currently operated at 80 per cent of production capacity of 1.3 million tonnes per year. It has three production plants, of which two are
located in Saraburi and the other in Nakhon Si Thammarat.
"We need to expand our production capacity and conduct aggressive marketing strategies if we plan to double our sales in five years," he said.
The new plant could be located in the central region, where demand is high, he added.
Although overall cement consumption is expected to fall by 5 per cent this year, Rewat is confident his firm's mortar sales will maintain growth of 10-15 per cent to 1 million tonnes thanks to high-quality products and innovative solutions for customers.
"Even though our sales growth is increasing, the growth in 2009 will still be lower than the [average] 20-25 per cent over the past five to six years, as a result of the economic slowdown. However, we believe that our sales growth will rise to 20 per cent next year, since property developers have returned to proceeding with their incomplete projects in big cities like Phuket," he said.
About 80 per cent of Siam Mortar's sales are from big property projects, with the remainder generated by private houses and the house-renovation market.
"Since the economic crisis erupted, we realised we should focus more on the private housing market. Despite a small volume of cement demand, it has more sustainable growth than large property projects," he said.
Hence, the company plans to change the sales proportion to generate 40 per cent of sales from property projects and 60 per cent from private housing and the renovation market.
He said the future trend of the cement market would be to develop eco-friendly products that would be good for both the environment and inhabitants' health.
"SCG Cement has allocated a budget of Bt200 million for research and development each year, because we will change ourselves from a cement-maker to a solution provider. For example, we will not only sell cement but also wall and floor systems in the future, in order to better utilise customers' budget and time," he added.
Presently, the total market for mortar cement is worth about Bt2 billion, with a volume of 2 million tonnes per year. It is predicted to expand by 10 per cent this year.
Siam Mortar has a 50-per-cent share of the market, followed by TPI Polene with 40 per cent and Siam City Cement with 10 per cent.
Friday, October 2, 2009
INNOVATION AND ADDED VALUE PAY OFF FOR SCG FIRM
SCG Building Materials, a subsidiary of the Siam Cement Group, has a simple marketing strategy: "Create better functions for all." The company's drive for innovative products and added value has won it acclaim within the giant conglomerate.
SCG Building Materials offers a range of products, including tiles, faucets, Cotto-brand sanitary-ware, CPAC Monier-brand roofing materials, CPAC Design-brand paving blocks and Siam Fiber Glass-brand insulation products.
President Pichit Maiphum said SCG Building Materials was forced to focus on innovative products and adding value to others because that generated higher returns on investment than producing and distributing cheaper products in a market with fierce competition and low profit margins.
"There is high competition for our products, so we have to have a marketing strategy of producing creative building solutions. This has more value than simply selling [conventional] products," he said.
The strategy, pursued over the past four to five years, has led to SCG Building Materials winning three out of four awards in the Siam Cement Group's first "in-house" Marketing Best Awards 2009.
The awards recognise superior marketing strategies, in which companies have built their brands and created new distribution channels, among SCG's subsidiaries. Eighteen marketing teams competed for the awards this year, the first time the competition has been held. There were only four awards: the SCG Marketing Best Award, a first runner up, a second runner up and Creative Best.
SCG Building Materials' three awards included first runner up for Cotto Speed Bathroom, second runner up for the Disney Collection by Cotto Tile, and Creative Best for Spark the Smart Installer, by CPAC Excella roof tiles.
Siam Sanitary Ware Industry marketing specialist Parapapar Atcharanukul, who led the Cotto Speed Bathroom team, said the company had succeeded in creating a marketing solution for tiles and sanitary-ware by offering a system in which it could design, renovate and build a customer's bathroom in seven to 15 days.
The company is currently developing the building concept to make it even faster in the future. This adds value to the products, rather than simply selling ceramic tiles and sanitary-ware, she said.
Cotto (Disney) Thai Ceramic marketing manager Pranee Chansuroj said the company created co-branded products in deals with globally-recognised brands such as Disney. This differentiated the products from normal ceramic tiles.
The company plans to join other global partners to produce more co-branded ceramic tiles this year, building added value for its products.
The presales manager for Excella roof tiles, Siriwan Lila, said Thai Ceramic Roof Tile had created a new distribution channel through local residents to the Thai temple market.
The company recognised a business opportunity in offering quality roof tiles for use on temples.
Previously, community funds used to renovate temple roofs were spent on locally made roof tiles of low quality.
Pichit said the three awards proved that his company's strategy was succeeding in building its brands. However, market pressures meant his company would have pursued the marketing strategy whether it received awards or not.
SCG Building Materials offers a range of products, including tiles, faucets, Cotto-brand sanitary-ware, CPAC Monier-brand roofing materials, CPAC Design-brand paving blocks and Siam Fiber Glass-brand insulation products.
President Pichit Maiphum said SCG Building Materials was forced to focus on innovative products and adding value to others because that generated higher returns on investment than producing and distributing cheaper products in a market with fierce competition and low profit margins.
"There is high competition for our products, so we have to have a marketing strategy of producing creative building solutions. This has more value than simply selling [conventional] products," he said.
The strategy, pursued over the past four to five years, has led to SCG Building Materials winning three out of four awards in the Siam Cement Group's first "in-house" Marketing Best Awards 2009.
The awards recognise superior marketing strategies, in which companies have built their brands and created new distribution channels, among SCG's subsidiaries. Eighteen marketing teams competed for the awards this year, the first time the competition has been held. There were only four awards: the SCG Marketing Best Award, a first runner up, a second runner up and Creative Best.
SCG Building Materials' three awards included first runner up for Cotto Speed Bathroom, second runner up for the Disney Collection by Cotto Tile, and Creative Best for Spark the Smart Installer, by CPAC Excella roof tiles.
Siam Sanitary Ware Industry marketing specialist Parapapar Atcharanukul, who led the Cotto Speed Bathroom team, said the company had succeeded in creating a marketing solution for tiles and sanitary-ware by offering a system in which it could design, renovate and build a customer's bathroom in seven to 15 days.
The company is currently developing the building concept to make it even faster in the future. This adds value to the products, rather than simply selling ceramic tiles and sanitary-ware, she said.
Cotto (Disney) Thai Ceramic marketing manager Pranee Chansuroj said the company created co-branded products in deals with globally-recognised brands such as Disney. This differentiated the products from normal ceramic tiles.
The company plans to join other global partners to produce more co-branded ceramic tiles this year, building added value for its products.
The presales manager for Excella roof tiles, Siriwan Lila, said Thai Ceramic Roof Tile had created a new distribution channel through local residents to the Thai temple market.
The company recognised a business opportunity in offering quality roof tiles for use on temples.
Previously, community funds used to renovate temple roofs were spent on locally made roof tiles of low quality.
Pichit said the three awards proved that his company's strategy was succeeding in building its brands. However, market pressures meant his company would have pursued the marketing strategy whether it received awards or not.
Rayong appeal discussed
The country's industrial giants gathered yesterday to discuss the court-ordered suspension of permits at Map Ta Phut and whether the private sector could petition the court to relax its orders.
Led by the two largest operators at the Rayong industrial estate - PTT group and Siam Cement Group - the companies discussed possible appeals with the Federation of Thai Industries (FTI). The government is already planning an appeal.
"The private sector, particularly big companies, have asked the government if the law will allow them to file petitions to request the court to delay its ruling's effective date," FTI chairman Santi Vilassakdanont said."In the dispute though it seems to be an argument between the government and activists - the sufferer is the business sector."
The Administrative Court on Tuesday suspended operating permits for 76 projects, based on Section 67 of the 2007 Constitution, which addresses the impact of industries on community health and the environment.
The FTI urged the government to seek a long-term solution that could allow investment and environmental conservation to coexist.
PTT, its subsidiaries and joint ventures have invested more than 120 billion baht in 25 projects, of a total 76 suspended, said Prasert Bunsumpun, president and chief executive of PTT.
The group will not be hurt as much as previously predicted if PTT's projects have to be delayed to comply with the court order, as most have yet to start construction, he said.
However, PTT's sixth gas separation plant and the olefins cracker of PTT Chemical Plc are heavily affected.
As a cracker is the upstream unit for petrochemicals, related industries would be short of domestic feedstocks and would require imported materials. SCG also has ongoing investments in a naphtha cracker and downstream plants un-der construction in the area.
"The whole country will see the impact - from the construction sector,creditors, employment, stakeholders and the stock market - not only the industrial sector will suffer," Mr Prasert said."They have abided by the law since the beginning, so I don't think they will tolerate this."
Tevin Vongvanich, chief financial officer of PTT Plc, echoed Mr Prasert.
"The damage has happened already.Some projects designed to improve the environment are also affected," he said."If it becomes clear that they don't want us to expand [in Map Ta Phut]anymore, we might have to look at other locations to place our investments in the future."
Surong Bualakula, a PTT senior executive vice-president for international business, said investor confidence had been shaken.
"The message perceived by investors abroad has made them panic. They [perhaps] don't know where Map Ta Phut is but it is actually the image of the country that has been hurt," he said.
Concerned parties should look at ways some projects can go ahead along with health impact assessments (HIA),he said."We should find the balance for environmentally responsible industries to live together with communities."
According to the ministry,11 projects out of 76 received environmental impact assessment (EIA) approvals before the 2007 Constitution took effect, so these projects worth 58 billion baht need not be suspended.
The remaining 65 projects include 47 expansions and 18 new investments,worth 229 billion baht in total.
Patareeya Benjapolchai, president of the Stock Exchange of Thailand, said the exchange hoped SET-listed PTT and SCG could resolve the matter."I believe there will be a positive answer to it as the government sector is taking interest in solving the problem," she said.
The issue is expected to have an impact on foreign direct investment rather than on the foreign investors in the Thai stock market due to their diversified investment portfolios, she said.
PTT shares closed yesterday at 263 baht, up one baht, in trade worth 1.11 billion. SCC also rose one baht to 223.
Led by the two largest operators at the Rayong industrial estate - PTT group and Siam Cement Group - the companies discussed possible appeals with the Federation of Thai Industries (FTI). The government is already planning an appeal.
"The private sector, particularly big companies, have asked the government if the law will allow them to file petitions to request the court to delay its ruling's effective date," FTI chairman Santi Vilassakdanont said."In the dispute though it seems to be an argument between the government and activists - the sufferer is the business sector."
The Administrative Court on Tuesday suspended operating permits for 76 projects, based on Section 67 of the 2007 Constitution, which addresses the impact of industries on community health and the environment.
The FTI urged the government to seek a long-term solution that could allow investment and environmental conservation to coexist.
PTT, its subsidiaries and joint ventures have invested more than 120 billion baht in 25 projects, of a total 76 suspended, said Prasert Bunsumpun, president and chief executive of PTT.
The group will not be hurt as much as previously predicted if PTT's projects have to be delayed to comply with the court order, as most have yet to start construction, he said.
However, PTT's sixth gas separation plant and the olefins cracker of PTT Chemical Plc are heavily affected.
As a cracker is the upstream unit for petrochemicals, related industries would be short of domestic feedstocks and would require imported materials. SCG also has ongoing investments in a naphtha cracker and downstream plants un-der construction in the area.
"The whole country will see the impact - from the construction sector,creditors, employment, stakeholders and the stock market - not only the industrial sector will suffer," Mr Prasert said."They have abided by the law since the beginning, so I don't think they will tolerate this."
Tevin Vongvanich, chief financial officer of PTT Plc, echoed Mr Prasert.
"The damage has happened already.Some projects designed to improve the environment are also affected," he said."If it becomes clear that they don't want us to expand [in Map Ta Phut]anymore, we might have to look at other locations to place our investments in the future."
Surong Bualakula, a PTT senior executive vice-president for international business, said investor confidence had been shaken.
"The message perceived by investors abroad has made them panic. They [perhaps] don't know where Map Ta Phut is but it is actually the image of the country that has been hurt," he said.
Concerned parties should look at ways some projects can go ahead along with health impact assessments (HIA),he said."We should find the balance for environmentally responsible industries to live together with communities."
According to the ministry,11 projects out of 76 received environmental impact assessment (EIA) approvals before the 2007 Constitution took effect, so these projects worth 58 billion baht need not be suspended.
The remaining 65 projects include 47 expansions and 18 new investments,worth 229 billion baht in total.
Patareeya Benjapolchai, president of the Stock Exchange of Thailand, said the exchange hoped SET-listed PTT and SCG could resolve the matter."I believe there will be a positive answer to it as the government sector is taking interest in solving the problem," she said.
The issue is expected to have an impact on foreign direct investment rather than on the foreign investors in the Thai stock market due to their diversified investment portfolios, she said.
PTT shares closed yesterday at 263 baht, up one baht, in trade worth 1.11 billion. SCC also rose one baht to 223.
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