In preparation for the planned single market of the ASEAN Economic Community (AEC) in 2015, PTT Global aimed to focus more on Southeast Asia, which should account for 50 percent of total sales in the next five years from about 30-40 percent now, said Chief Executive Veerasak Kositpaisal.
"In the next five to 10 years, growth in Asia and ASEAN will be higher than other regions," Veerasak told Reuters in an interview, adding that demand for plastics in the auto, electrical appliances and construction sectors would be strong.
PTT Global, 49 percent owned by state-controlled PTT Pcl , set up a liaison office in Beijing last year to help look for growth opportunities in the world's second-biggest economy, he said.
"In Asia, China is the most interesting country, but it's difficult to do business because all the global players have already invested and competition is fierce. But we think there should be an opportunity for us," Veerasak said.
For Indonesia, its large population, abundant resources and relative political stability were a good combination for growth, he said.
The company aimed to invest 10 billion baht this year ($319 million), which excluded any acquisition. Of the total, 3-4 billion baht would be for annual maintenance and 5-6 billion to boost efficiency, he said.
"We are studying several kinds of foreign expansion, which could be in the form of joint ventures, M&A or our own investment," he said, adding PTT Global had petrochemical interests in the United States, Germany and Malaysia.
Formed in October 2011 through a merger between PTT Chemical Pcl and PTT Aromatics and Refining Pcl, PTT Global has olefins and aromatic petrochemical capacity of 8.2 million tonnes a year and refining capacity of 280,000 barrels per day.
Valued at $9 billion, it is Southeast Asia's second-largest petrochemical firm by market value after Malaysia's Petronas Chemical.
PTT Global shares ended up 2 percent, outperforming a 1.2 percent gain in the market.
SPECIALTY PRODUCTS
As part of its plan to expand in high-volume specialty products, the company is in the process of buying a 51 percent stake in Perstorp Holding France SAS, expected to be completed in the middle of this year, Veerasak said.
Perstorp makes isocyanates in Europe and Asia, and the acquisition would allow PTT Global to produce specialty products like polyurethane, used in foam and coatings in the automobile and construction industry.
"The acquisition is aimed at buying technology," he said, adding PTT Global planned to build a new plant to produce isocyanates, but had not decided on the location.
Asked about funding for expansion, Veerasak said the company would use cash from operations but had room to borrow because its debt-to-equity ratio was low at 0.5.
PTT Global, which has no major shutdown plans this year, expected output in 2012 to be higher than last year, but revenue would depend on prices, which are likely to be volatile, in line with global oil prices
The company is due to report 2011 earnings next month and is expected to show a net profit of 32.7 billion baht on revenue of 479 billion, according to Thomson Reuters I/B/E/S. (Reuters)
