S. Khon Kaen eyes Vietnam

News - S. Khon Kaen Food Plc is looking to set up its first manufacturing plant in Asia outside of Thailand to increase its role in this region.

Charoen Rujirasopon, chief executive of S. Khon Kaen, displays some of the company’s products. The firm likes the population size and easy access to fish in Vietnam, making it a possible plant location in 2015.

Charoen Rujirasopon, chief executive of the food processing firm, said Vietnam is a potential location because it has a moderate population and is rich in fish that will serve its fish ball production.

But Vietnam has high taxes, so the company will wait until the Asean Economic Community (AEC) takes place in 2015 to capture the tax advantages.

S. Khon Kaen has one production base in Poland under a sub-contract that serves Asians living in Europe.

Another office in Hong Kong distributes its local products such as Thai-style sausage and dried shredded pork, which are shipped from Thailand. DKSH, a global trading firm, is in charge of distributing other products such as I, a meat-based snack brand, in Hong Kong.

The company exports its products to 30 countries. It has four factories in Thailand: two in Samut Sakhon, one in Samut Prakan and one in Nakhon Pathom.

Export sales contributed 15% of total sales and it expects exports to contribute about 20% in the future.

Last year sales reached 1.65 billion baht and are projected to grow by 15% this year.

“We started exporting our products 18 years ago. Now we want a bigger role in the global market, focusing on Asia,” Mr Charoen said.

The company plans to spend 150 million baht to expand its local business this year. Of the total, about 80 million baht will be spent to increase its seafood capacity and the rest for swine farming and its processed meat production.

The company will continue to promote its I meat snacks this year.

The total snack market is estimated to be worth 16 billion baht this year. Of the total, 2.5 billion baht belongs to meat snacks, with the majority potato and seaweed snacks.

I controlled an 8% market share last year and it expects this to rise to 12-15% this year.

Shares of S. Khon Kaen closed yesterday unchanged on the Stock Exchange of Thailand at 73 baht in trade worth 292,000 baht.