Srithai cuts its overseas investment programme
SRITHAI SUPERWARE has decided to suspend some of its overseas investment plans due to global economic conditions and the baht’s volatility, but the company is maintaining its target of achieving annual sales of Bt20 billion within the next five years.
“We are quite concerned about the global economic situation next year after the US central bank decided to hike its interest rates, declining oil prices and the volatile baht, which would affect our investment cost overseas. Therefore, we have decided to cut overseas spending to Bt350 million, from the original plan of Bt950 million,” Sanan Angubonlkul, chairman and president of Srithai Superware, said yesterday.
New projects in Vietnam, India and China will be postponed.
However, the company still sees Vietnam as a promising market which is home to a growing number of middle-class consumers in its 94 million-strong population, 70 per cent of whom are aged between 15 and 60.
“Therefore, we are attaching more weight to business activities in this country by focusing on the manufacturing of packaging for food and beverages, materials-handling products and plastic pallets,” he said.
Although the company is suspending some new projects in Vietnam, he said Srithai’s domestic melamine factory would support Vietnamese demand by exporting finished products to its distributors in Ho Chi Minh City and Hanoi.
The company is also looking for an opportunity to invest in Myanmar, but there are several issues to be addressed before making a decision.
“Myanmar is also an important market in the future. But I have to keep a close eye on its power transition from the current government led by the military, to an elected one. The stability of Myanmar’s currency is another issue to consider,” he explained.
However, investment for the domestic market remains unchanged at Bt550 million, in order to enhance existing facilities and extend new product lines to reach new segments, such as the niche and lower-end markets, Sanan said.
“The domestic market appears to be saturated. We need to create and invent new products to encourage new demand from particular groups of consumers,” he stressed.
The company yesterday launched a new brand – The Potter – locally to expand its range to new-generation consumers in the Kingdom.
Positioned as lifestyle tableware and accessories, his daughter Piyaporn, who graduated in fashion design in London, is now in charge of this project, along with his son, Garun.
The new product range includes tableware, kitchen fabric accessories, fabric bags and home furnishings.
The Potter collection was first introduced in 2012 in Hong Kong. “This is the right time for this product to be available in its home market,” Sanan said.
In the next three years, the company targets sales of Bt120 million from the range at home and overseas.
It is also interested in the lower-end market both upcountry and in neighbouring countries by producing unbranded melamine kitchenware, he said.
Despite suspending some projects, Sanan still believes that in the next five years, his business empire will continue to grow to sales of Bt20 billion – double this year’s level.
Apart from organic growth, the company is putting equal weight to mergers and acquisitions for business growth.
Next year, it expects at least one deal to be sealed in Vietnam.
