Ch Karnchang plans debenture ahead of mega-project bids
Construction firm Ch Karnchang will issue a debenture worth between Bt3 billion and Bt4 billion to support its plan to bid for a large slice of the government's Bt2-trillion infrastructure projects this year.
“We expect a share of between 25 and 30 per cent of the government’s infrastructure projects, which are worth Bt2 trillion,” chief executive officer Plew Trivisavet said after a shareholders’ meeting yesterday.
The company has also prepared additional funding for the bidding by reducing its stake in Thai Tap Water Supply from 30.04 per cent to Bt19.04 per cent during the previous quarter, generating Bt3 billion in cash.
Added to this is the Bt1 billion brought in from the 7.97-per-cent share sale in Bangkok Metro, funds which will also go in part towards the mega-project bidding.
Plew said some of the cash raised from these sales had also been used to pay back a portion of Ch Karnchang’s debt. This has reduced its debt-to-equity ratio from 2.6:1 at the end of last year to 1.4:1 as of end-March.
The listed contractor targets revenue of between Bt25 billion and Bt28 billion this year, generating a gross profit margin of 8-10 per cent for the year, he added.
The company announced revenue of Bt22.36 billion and net earnings of Bt568.4 million for last year. Its shareholder meeting yesterday approved a dividend of Bt0.35 per share for 2012 results.
As of the first quarter of this year, the company had a total contract value of Bt165.92 billion, which will generate revenue through 2017.
The company also targets signing additional contracts this year worth between Bt30 billion and Bt40 billion. This includes joint bidding with partners for the government’s Bt2-trillion infrastructure projects on logistics, as well as for the government’s water-management projects worth Bt350 billion.
“We will continue to participate in the joint bidding for the water-management system that is now in the process of being studied, even though the project’s terms of reference have presented some problems.
“We will make a final decision on May 3, which is the deadline for sending in the proposal,” the chief executive said.
Ch Karnchang has tied up with Team Thailand to jointly bid for development of the nation’s water system.
Meanwhile, the company has applied for CK Power, in which it holds a 38-per-cent stake, to be listed in the Stock Exchange of Thailand in the current quarter. This will be done via the sale of 180 million new shares to the public.
“CK Power will focus on developing alternative energy for electricity, both domestically and overseas,” he said.
CK Power operates a hydro-electricity dam at Num Nugm 2 in Laos via a major stake in South East Asia Energy.
The company, which has registered capital of Bt5.5 billion, is also invested in the Bang Pa-in Co-generation 1 power plant, and in solar energy in Nakhon Ratchasima province.
