Italthai to push growth with Bt11-bn 5-year plan
Italthai Group yesterday announced an accelerated plan to double the size of its businesses and to invest Bt11 billion during the next five years.
Chief executive officer Yuthachai Charanachitta said the group – which is involved in two different businesses, construction and engineering and hospitality and lifestyle – has recognised a need to quicken its pace and grow its business.
"We have been growing steadily for the past 60 years. But for the next 60 years, gradual growth may not be able to keep pace with the fast-expanding marketplaces," he said.
To finance its expansion, Italthai is considering various funding alternatives, including floating its shares on the stock exchange and seeking overseas partners, Yuthachai said.
He said Italthai aimed to double its annual sales revenue from last year’s Bt12.8 billion to Bt25.8 billion by 2019. Of the total, it hopes to ramp up construction-equipment sales during the five-year period from Bt4 billion to Bt8 billion; sales from the engineering business from Bt3.2 billion to Bt7.6 billion; and from the hospitality and lifestyle businesses from Bt5.7 billion to Bt10.2 billion.
The Onyx Hospitality Group will get a larger share of the total investment budget, amounting to Bt7 billion. Yuthachai said it planned to boost the number of hotels from 38 properties in five countries at present to more than 100 properties with more than 18,500 rooms in 10 countries within five years.
The focus will be on populous countries such as China, India and Indonesia. It aims to grow overseas revenue from 20 per cent of its total hospitality revenue at present to at least 40-50 per cent during that period.
"We may have a surprise about a deal in Australia, to be announced shortly," he said.
The investment plan also includes renovation of its "trophy" asset, the Mandarin Oriental Bangkok hotel, which will commence this year.
Yuthachai, now 36, took the helm in 2011 when the group’s annual sales totalled less than Bt10 billion. Since then, sales of the group’s engineering business have grown by about Bt1 billion annually. The head counts of his heavy-machinery business has grown from 400 staff to 600, while the hospitality business has survived difficult market situations.
"Since 11 years ago when my father passed away, we have progressed from a company that everyone had almost forgotten to become what we are today," he said.
Italthai will keep its focus on its two business sectors, which are central to the Thai economy and are well positioned to reap benefits from the full implementation of the Asean Economic Community.
Yuthachai said the engineering business had not ruled out investing in renewable-energy plants , though for now it would concentrate on being "the contractor of choice" for other developers of renewable-energy projects.
Italthai’s hospitality and lifestyle business group operates several brands under the wing of Onyx Hospitality Group including Amari, Saffron, Ozo and Sharma; the Amari Estate brand that owns and develops residential projects in Bangkok, Hua Hin and Phuket; and the River City Shopping Complex in Bangkok.
