What is Amata's business model?
Amata Corporation Plc is the largest listed company in the industrial estate sector of the Stock Exchange of Thailand. Viboon Kromadit, director and chief marketing officer, discusses the company's strategy and outlook.
Amata plans to launch a REIT and list a Vietnamese affiliate, Mr Viboon says.
We are a bridge for our customers, providing the ideal industrial city that allows them to focus purely on their business. Our business model is first and foremost a pure land developer that provides the infrastructure and facilities that businesses need to set up and operate. However, we have taken the model further via partnerships and joint ventures to add utilities and facilities such as power plants, hospitals, schools, recreation and shopping malls which allow our customers to feel at home in our industrial estate cities.
We have three key locations — Amata Nakorn, Chon Buri; Amata City, Rayong and Amata City, Bien Hoa in Dong Nai province of Vietnam — with a combined total of 77 million square metres.
Who are Amata's customers?
We have more than 1,000 factories, of which 60% are occupied by Japanese companies, and almost half of all our customers are in the automotive industry. The rest are from China, the US, Europe and other Asian countries and operate in machinery, agricultural equipment, home appliances, food and beverages, chemicals and several other fields.
An interesting development in recent years is the number of Thai companies becoming customers because of our services. In Thailand a business has to deal with multiple government agencies in order to begin manufacturing, which can be cumbersome and delay business growth, but as a customer of Amata they only have to deal with the Industrial Estate Authority of Thailand a one-stop service for licences with support from our after-sales team.
Amata has several joint ventures and is planning initial public offerings for some business units. Could you elaborate?
We plan to launch a REIT (real estate investment trust) this year as well as list the Vietnamese affiliate Amata VN Plc, both of which are have been filed with the SET and the SEC. Our model is to partner with experts in their fields who will add value to our cities and our customers.
Today we have 24 active companies that range from our JV with B Grimm for power to Amata NGD with PTT to distribute natural gas to our customers, to hospitals, schools and recreation facilities as well as several others. We will continually look for additional partnerships where we can turn our land into equity and provide the best services and facilities for our existing and future customers.
What differentiates Amata from its competitors?
It is our value-added services. Our company takes the viewpoint that "our customers' problems are our problems" and we view each customer as part of the Amata family. Something as simple as providing an immigration service for our clients at our locations or hosting events to help our SME customers meet larger companies are examples of our additional services.
Reputation is very important and we always ensure that everything is prepared for our clients to operate their businesses. As a result, they tell other potential customers that Amata is a trustworthy partner.
What are the biggest risks facing your business?
Things that are beyond our control such as natural disasters, national infrastructure and government policies. But we have measures to control and mitigate these risks on behalf of our clients as much as possible to ensure ease of doing business.
What impact will the Asean Economic Community have on your business?
There are both positives and negatives for Thailand. On the positive side, Thailand has a unique advantage because of its location, in the centre of the region as within three hours we can travel to almost every country in Asia. Infrastructure and logistics such as the East-West corridor, improved railway systems, a landbridge connecting the Indian Ocean and Pacific Ocean would truly make Thailand a logistics hub for the region.
The negatives for Thailand could be the mobilisation of labour. The country today faces challenges dealing with the influx of workers and we may end up losing our best employees to Singapore because of higher salaries and standard of living. In the end I hope that Thailand is able to move further up the value chain, similar to Israel, and become one of the strongest research and development centres in the region and the world.
Where do you see Amata in five years?
We look at everything from a very long-term viewpoint, and in the future we dream to have 1 million rai of Amata Industrial Estates throughout the region. We will continue to improve to be more than just an industrial estate. Whether we create a smart city or a green city, in the end Amata has to be a companion and the perfect city for our customers.
The Executive Q&A Series is presented by ShareInvestor, Asia's leading financial internet media and technology company and the largest investor relations network in the region, with more than 500 listed clients. This interview was conducted by ShareInvestor. For more information, e-mail admin.th@shareinvestor.com or visit www.shareinvestorthailand.com