Oishi to grow through M&As

Phillip Capital noted that Oishi executives acknowledged that mergers and acquisition, including the establishment of a joint-venture company, is one strategy to accelerate revenue growth.

Oishi is negotiating with companies over the possibility of mergers and acquisitions or setting up a joint-venture company.

Oishi expects to resume strong growth this year due to its synergies with companies under the Thai Beverage Group, with it to increase its distribution channels, make procurements and launch sales marketing activities.

As part of its beverage business strategy this year, Oishi will launch new products and forge a synergy with Fraser and Neave to expand its exports including becoming an original equipment manufacturer for F&N to produce beverage products.

Oishi this year will open 45 restaurants in the country and plans to open two restaurants in Myanmar as part of its overseas expansion plan.

An analyst noted that the synergy strategy would help drive Oishi’s sales revenue – forecast to be Bt14.05 billion this year, or a 15 per cent increase year on year.

The analyst said the company’s margin this year was expected to be stable as a result of the rising production capacity and sales revenue.

Its sales and operating expenses would expand in line with the new outlet expansion and marketing activities.

The analyst estimates Oishi’s net profit this year will surge 80 per cent to Bt820 million.

Oishi’s net profit last year was Bt455.57, down 30 per cent from Bt653.83 the previous year.

In 2013, its sales revenue from beverages dropped 1 per cent year on year and the sales and operating expenses increased 16 per cent year on year.

However, the fourth quarter performance showed significant growth of Bt313 million due mainly to the synergy with Thai Beverage Group.

In December, the market share of its green tea beverage rose to 44 per cent while its main rival’s market share is 23 per cent.