Thailand- based industrial estate developer Amata Corporation has set up a 42:58 joint venture firm with Bangkok Industrial Gas (BIG) to run industrial gases business to serve demand in industrial estates.
The joint venture company, Amata Industrial Gas Co, will provide the service of industrial gases and related innovation to the factories in Amata City in Rayong province in the start. Within five years, it will extend the service to other industrial estates under Amata Corp’s umbrella.
“Demand for industrial gases has increased continuously in accordance with the growth of gas-based industrial plants. Therefore, this joint venture will not only add value to our business, but also help our clients lower the production cost and increase their competitiveness in the long run,” Viboon Kromdit, chief marketing officer of Amata Corp, said.
Selling land for industrial estate development has been the group’s core business for the past 40 years. However, Amata is trying to generate more income from providing long-term facilities and after-sale services to clients. The facilities include power supply, tap water and other infrastructure.
Revenue from land sales currently contributes 60 per cent of total and the rest 40 per cent from providing facilities, which will be raised above 50 per cent over the next five years.
By 2020, Amata expects to have 2,000 factories investing in its industrial estates domestically and overseas, up from the current 1,200.
In Vietnam, it has an available land bank of 5,000 rai, which is expected to increase to 6,000 soon. Meanwhile, it has 15,000 rai of land bank in Thailand which is developed to serve demand when the economy recovers.
The company is also seeking the opportunities to increase the number of its subsidiaries through joint ventures and acquisitions in Thailand, Vietnam and Myanmar. It targets to have 50 companies over the next five years, up from 30 companies at the moment.
It expects the revenue in 2016 will grow 20 per cent from last year’s target of 7.8 billion baht, due mainly to the government’s investment in mega projects.
It posted the revenue of 5 billion baht for the first nine months last year and the land sales for the whole 2015 are estimated to be 800-1,000 rai.
Around 60 per cent of its clients are Japanese companies, while the rest 40 per cent are from China, the United States, the European Union and Thailand.