SET-listed Sermsuk Plc (SSC), the maker of Est soft drinks, is pushing into primarily Asean countries to raise exports to 20% of overall sales within four years.
The move is part of a plan by parent Thai Beverage Group (ThaiBev), owned by billionaire Charoen Sirivadhanabhakdi, called 2020 Vision, which aims to boost sales of non-alcoholic products to 150 billion baht by 2020.
Sermsuk will broaden the range of products sold in Asean by focusing on leading brands 100 Plus, Ranger, Est and Oishi, said president Vivek Chhabra.
The company already exports Ranger energy drink, Est soda and Oishi green tea to Malaysia as well as the green tea to Singapore. Sermsuk handles product distribution overseas for Oishi.
The 100 Plus functional carbonated soft drink had a successful launch in Thailand last year, ahead of Asean shipments this year.
To boost its export business, Sermsuk will continue to work closely with ThaiBev, Thai Drinks, F&N Malaysia and F&N Singapore. Sermsuk's exports make up less than 10% of total sales.
In the first quarter this year, Sermsuk's revenue increased 15% to 2.69 million baht thanks to its strong market share of three beverage brands -- Est soft drinks with 10%, Crystal water 17.3% and Oishi beverages 43.1%.
With ThaiBev's goal to become a top five beverage company in Asia by 2020, Mr Chhabra said mergers and acquisitions could be on its strategic investment agenda in addition to the push into Asean.
ThaiBev controls a 14% market share of the Asean beverage market, he said.
Mr Chhabra said Sermsuk developed its business plan by strengthening three strategies to meet diverse consumer needs. It is expanding product lines in both domestic and international markets, boosting sales, and managing costs wisely by reducing packaging, transportation and warehouse expenses.
There are many factors that can help Sermsuk achieve sustainable growth. The first is its healthy revenue performance this year. Second is adding healthy drinks such as soya milk and juice to its portfolio of products this year.
The third factor is expansion of its production lines. Sermsuk has seven production plants with 51 warehouses across the country including more than 1,000 sales trucks. It will expand its product lines in Khon Kaen province over the next two months and in Surat Thani next year.
The last factor is to increase exports to Asean and Asian markets.
During the first quarter, Sermsuk posted a net loss of 63.5 million baht while revenue totalled 2.75 billion baht. Last year, it recorded a 304.8 million baht loss on revenue totalling 11.32 billion baht.
SSC shares closed unchanged yesterday on the SET at 62 baht in trade worth 93,120 baht.