Heavy machinery importer expects substantial growth

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Heavy machinery importer expects substantial growth

Italthai Group, which ranks among one of Thailand’s longest-established trading and hospitality companies, recently suggested that its heavy machinery importing and distribution arm, Italthai Co., is looking at turning over 4.8 billion baht in revenue this year as a result of the number of construction projects being undertaken across the country. If it reaches this figure it will mean that Italthai Industrial will have achieved a whopping 26 percent growth in revenue.

Italthai Industrial distributes eight construction and industrial machinery brands, including the highly-rated and regarded Volvo and Tadano marques as well as some Chinese makers. The company also offers after-sales services for those brands in both Thailand and Laos.

Clearly the government-driven series of major infrastructure projects is providing the main catalyst for this exponential growth in revenue. That investment in infrastructure by the central government in projects such as roads and expressways will help raise the overall market for heavy machinery this year by 15 percent according to Italthai Industrial, reaching 50 billion baht.

The company says it is in a position to be able to supply necessary products and quality brands to serve all market segments.

Italthai said its sales of Volvo and Tadano make up almost 70 percent of its revenue, but the company also wants to market China’s SDLG, which is set to become another competitive brand capable of competing with used heavy machinery in local markets.

SDLG is under exported under Shandong Lingong Construction Machinery from China and Volvo, the Swedish maker, which holds a 70 percent stake in the company. Italthai has been SDLG’s importer and distributor in Thailand for the last four years.

The company is looking to double SDLG’s sales this year to 400 million baht, up from the 200 million baht turnover it enjoyed in 2015.

Italthai ranks as the number one distributor across the world for the Shandong-based company.

SDLG produces wheel loaders, motor graders, backhoe loaders and soil compactors and Italthai believes the company’s market share will creep up to 30 percent this year, from 25 percent last year, which is equivalent to around 1.4 to1.5 billion baht in market value.

If this does manage to happen, the Chinese brand will partly help Italthai Industrial Co to reach that revenue target of 4.8 billion baht and lock in that 26 percent rise.

Overall, Italthai Group has announced plans to raise revenue in the next three years to about 26 billion baht, or double its current levels, largely on the back of the newly-created Asean Economic Community (AEC).

Italthai Industrial would be expected to contribute a significant eight billion baht or 30 to 35 percent of the group’s projected revenue.

To achieve this, Italthai Industrial will increase the number of service centres for all brands from 15 to 30 locations by 2019, covering Thailand, Laos, Cambodia and Vietnam utilising an investment budget for its construction and engineering businesses of four billion baht.

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