Thailand PTT Oil and Retail Business (OR) non-oil businesses on fast track
Source：Bangkok Post Newspaper
From：Taiwan Trade Center, Bangkok
Update Time：2021/04/14
PTT Oil and Retail Business (OR) is putting new non-oil businesses in which it recently invested, including Ohkajhu organic restaurants and Pacamara coffee houses, on the fast track for business expansion, says OR president and chief executive Jiraphon Kawswat.
The new non-oil businesses made up 15% of its 74 billion baht in capital spending allocated for 2021-2025.
Their rapid growth will synergise with the operation of PTT stations nationwide, which currently offer a range of services from oil refilling to convenience stores and Cafe Amazon.
PTT stations see more than 60% of its 3 million customers on daily average use non-oil services while only 40% have their cars refilled.
The synergy plan, which will also include overseas businesses, is overseen by OR wholly-owned Modulus Co, which was established last month.
"We are scaling up several new non-oil businesses which are expected to grow rapidly over the next five years," said Ms Jiraphon.
They include Ohkajhu organic restaurants, now with 14 branches countrywide. Its operator Pluk Phak Praw Rak Mae Co sold a 20% share, worth more than 400 million baht, to OR last month.
OR also spent 172 million baht buying a 65% share in Peaberry Thai, which manufactures and distributes coffee beans and equipment as well as operating cafes under the Pacamara brand.
It also purchased a 10% share worth 900 million baht in Flash Express Co, which provides express delivery services, in October last year. This startup will synergise with 2,000 PTT stations and 3,200 Cafe Amazon nationwide.
Ms Jiraphon said OR is looking for new investment opportunities in other startups in healthcare and car sharing sectors.
The company also plans to allocate 450 million baht to add 100 electric vehicle charging outlets nationwide this year, up from the current 33 outlets. The number will increase to 300 within next year.
Other non-oil businesses, including those under franchise, are Fit Auto car care service and Jiffy convenience stores as well as Texas Chicken, Hua Seng Hong Dim Sum and Daddy Dough, all of which are food businesses.
Earnings before interest, taxes, depreciation and amortisation (Ebitda) from all non-oil businesses are expected to increase to 33% from 25% within five years while Ebitda in oil retail will decrease to 55% from 70%.
Ebitda from overseas business is expected to increase to 12% from 5%.
OR's profit margin in oil trade has stood at 4% over the past three years due to stiff competition, compared with a 25-28% margin made by non-oil businesses.
The firm earlier announced allocating 74 billion baht for capital spending.
Source: https://www.bangkokpost.com/