Contractors bank on 2016 govt projects
Construction companies target growth of up to 20 per cent next year thanks to the government's policy to speed up investment in infrastructure projects under the public-private partnership (PPP) fast-track programme, worth more than Bt347 billion.
"We are ready to bid on the new infrastructure projects when the government opens them to tender," Ch Karnchang chief executive officer Plew Trivisvavet said.
The company aims to win 20-25 per cent of the government’s infrastructure contracts next year, while this year it also targets securing about 25 per cent of the total project value of Bt150 billion.
"We believe that the government will start more infrastructure projects in the first quarter of next year. This will help the recovery of the construction business.
"We plan to bid on all of the government’s new infrastructure projects, such as motorways, railway double-tracking and high-speed rail, targeting a share of between 20 and 25 per cent of the total value of projects put out to tender next year," he said.
Italian-Thai Development managing director Premchai Karnasuta said earlier that the company was ready to bid on the government’s infrastructure projects such as the mass-transit system’s Orange, Pink and Yellow lines, motorways, and railway double-tracking.
The company is also interested in being a subcontractor for the Bt400-billion Bangkok-Nong Kai railway, a joint development by Thailand and China.
Sino-Thai Engineering and Construction, which won a Bt9.926-billion contract for the Cha Chen Soa-Klong 19-Kang Koi double-track rail system last week, is also planning to bid on other infrastructure projects next year.
On November 3, the Cabinet approved eight projects under the PPP fast-track programme worth Bt347 billion. The implementation of the projects could be shortened from 22 months to nine months. The projects are designated for next year and 2017.
They include the Pink Line, the Yellow Line, the Blue Line (Bang Sue-Tha Phra), the Bang Pa-in-Nakhon Ratchasima motorway, the Bang Yai-Kanchanaburi motorway, a garbage-disposal plant in Nonthaburi province, garbage-disposal facilities in Nakhon Ratchasima, and a marine commerce centre.
The Department of Highways said last week that the 196-kilometre Bang Pa-in-Nakhon Ratchasima, 96km Bang Yai-Kanchanaburi, and 32km Pattaya-Map Ta Phut motorway projects could begin shortly after the Cabinet’s recent approval. Total investments are expected to be Bt160.42 billion and will start next year.
With the planned aggressive investment in infrastructure projects to drive the country’s economic growth in 2016 and 2017, an analyst from DBS Vickers (Thailand) Securities Co is confident that listed construction companies will benefit. The investment will also benefit construction-materials companies, especially cement businesses, as the demand for cement next year will recover from this year’s flat growth.
Meanwhile, most listed construction firms reported revenue growth in the first nine months compared with last year.
Italian-Thai Development reported revenue of Bt37.41 billion, up 5 per cent Bt35.44 billion in the same period last year. But the company reported a net loss of Bt406.38 million in the period, compared with net profit of Bt474.69 million in the first nine months of last year.
The company reported the Stock Exchange of Thailand that it suffered a foreign-exchange loss worth Bt53 million, compared with a forex gain of Bt157 million in the same period last year.
The company also set up a Bt636-million allowance for doubtful accounts, an increase of Bt611 million from the same period last year. This was mainly from for doubtful accounts of an overseas subsidiary, to be settled through an arbitration process with a project owner whose payments were overdue.
Ch Karnchang reported revenue of Bt28.88 billion and net profit of Bt2.43 billion in the first nine months, up 5.49 and 27.22 per cent respectively from the same period last year.
Syntec Construction announced revenue of Bt5.32 billion and net profit of Bt433.42 million, up 3.5 and 61 per cent respectively.
Unique Engineering and Construction reported revenue of Bt6.84 billion and net profit of Bt484.39 million, up 10.5 and 28 per cent respectively.
Nawarat Pattanakarn’s revenue was Bt5.81 billion, up 16 per cent, but the company reported a net loss of Bt11.47 million in the first nine months of this year. That was better than its net loss of Bt75.13 million in the same period of 2014.
Sino-Thai Engineering and Construction reported revenue of Bt14.02 billion and net profit of Bt920.4 million in the first nine months, down 11.7 and 20 per cent respectively from the same period last year. This was attributed to some construction projects being delayed when the economy slowed down.