The listed contractor Thai Polycons (TPOLY) expects revenue to jump to 5 billion baht in the next three years thanks to its growing backlog and new investment in a lucrative biomass power plant, according to managing director Charoen Chanpalangsri.
The company reported a net profit of 58.8 million baht on revenue of 1.3 billion baht for the first nine months of this year, a 127% jump from 25.97 million in profit on revenue of 1.27 billion in the same period last year.
For next year, it projects revenue to grow by almost 14% to 2 billion baht from an estimated 1.76 billion this year. Importantly, its net profit margin will grow to 6% from 4.6% at present over the next three years, said Mr Charoen.
TPOLY will start investing in the biomass power plant early next year by taking a stake of 60-70% in the 700- million-baht project. The balance will be held by German investors and local communities.
The plant, to use coconuts, palm and other farm products as fuel, will complete construction in 2013. It will then contribute income of 120 million baht per year from power sales throughout the 25-year term of the purchase agreement.
The 9.5-megawatt plant is estimated to break even in six years and TPOLY plans to invest in three more biomass projects in the next three years.
Mr Charoen said that to finance the projects, TPOLY will rely on bank loans or issuance of debt instruments and operating cash flow.
“Bank loans will be our first choice since our debt-to-equity ratio is still low, at 0.21 times. Our investors need not worry about capital increase that may dilute their holdings,” he said.
For its core construction business, TPOLY expected growth of 20% this year. Currently, it has a backlog worth 3.9 billion baht, projected to reach 4 billion baht by the end of the year and 5 billion baht next year.
Mr Charoen said TPOLY is now studying to expand its construction business to neighbouring countries next year. It is also keen on property business such as condominiums.
The Stock Exchange of Thailand announced yesterday that share trading for TPOLY would move from the Market for Alternative Investment to the SET starting tomorrow in the property and construction sector.
“Being on the SET will increase confidence among financial institutions, investors, traders and developers. It also reflects a strong financial status that should allow us to raise funds more cheaply in the future,” said Mr Charoen.
Shares of TPOLY closed at 2.52 baht yesterday, up eight satang, in trade worth 12.49 million baht.
