Thailand-based Yong Concrete PCL has announced plans to build two new facilities in the country. Themove comes in response to rising demand in the Eastern Economic Corridor (ECC), and is aimed at offsetting market slowdown and government budget delays.
Sunpetch Slisatakorn, CEO, said that one of the planned facilities will produce ready-mix concrete in the Nong Bua sub-district in Rayong’s Ban Khai district. An investment of THB10m (US$273,726) will be needed to commission the plant on the 9600m2 site. Mr Slisatakorn added, “The first plant can support several industrial estate projects in Ban Khai, particularly from major player WHA.” Construction will start in the next three months, and revenue recognition will begin in the fourth quarter of this year, according to Mr Slisatakorn.
The second plant will produce precast concrete, and will be located on a 121,600m2 plot in Map Kha sub-district in Rayong’s Nikhom Pattana district. The project will be divided into four phases, with around 32,000m2 allocated per phase. Construction of first phase of the THB120m plant will commence in the 4Q24 and is expected to be completed within 10-12 months. One fully operational, both new plants will contribute 10 per cent to the company’s revenue.
"We have no customers in Rayong where potential is high. The new plants will help us grow and minimise risks from relying on government jobs and the residential sector,” Mr Slisatakorn said.
In the 1Q24 government budget delays meant that concrete usage fell below targets in several government projects. This negatively affected the company’s revenues, 58 per cent of which comes from contractors who were involved in government projects. Yong Concrete's CEO further explained, “The decrease in concrete demand was also due to low investment confidence, high interest rates, financial institutions tightening mortgage rules and weak purchasing power which slowed down the property sector.”
Yong Concrete recorded THB298m in revenue in the 1Q24, up 10 per cent YoY. Approximately 58 per cent of revenues came from contractors, 35 per cent from property projects and seven per cent from government projects.
