Thitikorn eyes asean ventures
Thitikorn, Thailand's leading provider of motorcycle loans, wants to tap into the Asean market, targeting Indonesia and Vietnam as its first priorities, after succeeding in the domestic market with Bt7.6 billion in lending last year.
Managing director Prathama Phornprapha said yesterday that the company was studying the feasibility of expanding into Asean countries.
"We expect to commence this business expansion in the next one or two years in response to the full liberalisation under the Asean Economic Community that will take effect in 2015," she said.
The expansion plan would be carried out either by setting up joint ventures with local partners or by acquiring stakes in local firms. However, the company will think carefully about entering overseas markets where there is an existing major player. For example, in Indonesia, PT Astra is a leader in the leasing business.
Before expanding outside Thailand, Thitikorn also needs to adjust such operations as its financial and software systems as well as its human resources.
Prathama said Indonesia had a huge motorcycle market. It moves about 8 million units a year and has high potential to reach 10 million. "If we can share about 5-10 per cent of the motorcycle market in Indonesia, that is as much as half of the market in Thailand," she said.
Considering the size of the same business, she said that Thitikorn has more competitive edge than others, employing about 1,900 persons comparing to 8,000 persons of the others. ???
In Vietnam too, the market is growing faster than in Thailand.
For the domestic market, she said the company would keep its focus on the motorcycle leasing business after competition in car financing had increased over the past few years.
Thitikorn’s total lending is expected to grow by 10 per cent to Bt8.4 billion this year, compared with an estimate of the total motorcycle-loan market of Bt80 billion, Prathama said.
Thai motorcycle sales this year are expected to hit a record 2.1 million units. Therefore, the company is increasing its distribution channels to 85 dealers from 80 currently in 46 provinces. It will recruit 350 more staff members to serve its business growth.
Thitikorn has recorded four straight years of lending growth, bringing its total clients to 250,000 with Bt7.5 billion worth of loan value. Of that, 80 per cent are motorcycle loans and 20 per cent for cars.
