Kaset Thai International Sugar Corporation (KTIS Group), the country's third largest sugar manufacturer, will seek funds to expand capacity of its bio-power plants through the stock market in the second quarter of this year.
KTIS CEO Praphan Siriviriyakul said the company is waiting for the stock market sentiment to improve.
"We expect to list on the Stock Exchange of Thailand in the second quarter of this year," said Mr Praphan.
KTIS Group, formerly known as Thai Identity Sugar Group, was founded by Siriviriyakul in 1957, with a factory based in Nakhon Sawan province.
KTIS operates an integrated sugar business which consists of three sugar mills, a pulp and paper factory, an ethanol factory, a bio-mass power plant and a fertiliser factory.
Currently, 80% of revenue is generated by sugar products while other businesses account for 20%. But over the next three to five years, the source of revenue will change as revenue and net profit from other businesses will increase from 20% to 40%, especially from the bio-power plant while sugar will generates less than 60%.
"Revenue and profit growth are expected to gain sustainably because of alternative products related to sugar, especially bio-power projects," said Mr Praphan.
The company plans to invest around 4 billion baht this year. From this figure, some 1.92 billion baht will go toward two new bio-power plants, while the remainder will go for a new bio-gas project as well as increasing the company's sugar capacity from 50,000 to 55,000 tonnes per day.
Each bio-power plant will have a capacity of 50 megawatts per hour and bio-gas has a capacity 100,000 standard cubic feet per day.
Under the fund-raising plan, the company appointed Kasikorn Securities as the financial advisor. Under the plan, it will issue 957 million new shares from paid-up capital of 3.274 billion shares with the par value of one baht each.
The shareholder structure will be altered after the initial public offering is completed. KTIS Group will hold around 70-75%, Sumitomo and Nissin Sugar will hold around 7.5% and 5% shares, respectively, and other public companies will account for the remainder.
Mr Praphan said the KTIS Group has sustainable growth, sugar capacity has increased from 500 tonnes per day from the beginning to 50,000 tonnes per day at present. Revenue for the past two years (2011-2012) was around 20-24 billion baht, and net profit was 1.11 and 2.5 billion baht, respectively.
KTIS exports 70% of its sugar with domestic sales accounting for 30% and the company plans to increase its export sale volume. He added that it is difficult to expand domestic sales as the market price and volume are controlled by the government.
Mr Praphan said the AEC market will be focused especially Indonesia, the biggest market in this area.
Sumitomo, the company's partner, will increase export volumes to the AEC, while the Japanese market will increase other products such as refined sugar as well as raw sugar.