Siam Cement Group (SCG), Thailand’s largest conglomerate, reported a strong performance of its Cambodian operations in 2017, driven by the fast growth of the country’s construction and real estate sectors.
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Cambodia continues to be one of the strongest markets in the Asean region for the Thai firm, according to the company’s unaudited operating results for 2017.
In Q4 2017, SCG’s revenue from sales rose by 26 percent, reaching $91 million, due mostly to the operations of their factory in Kampot.
Total revenue from sales in 2017 was $344 million.
“Cambodia showed continuous growth compared to the previous year due to increasing numbers of residential and commercial construction projects driven by the expansion of main cities such as Phnom Penh and Siem Reap,” the report said.
“Amidst fierce competition in the building materials business, SCG has constantly develop high value added products and services to gain more competiveness.”
The report highlights the launch by Kampot Cement Limited – SCG’s subsidiary in the kingdom – of a new product dubbed “Super K Plastering”.
“This innovative product is specially designed to produce 40 kilograms of plastering cement that can perform as well as 50 kilograms of normal plastering cement. This product will benefit Cambodia’s fast-growing construction sector,” it said.
Roongrote Rangsiyopash, SCG’s president and CEO, said the company’s economic performance last year was “satisfactory”, despite facing a number of challenges at home and abroad, including heightened competition nationally and regionally, rising costs of raw materials and a strengthening of the Thai baht.
“SCG has also acquired a 68.3 percent stake in Interpress Printers, a leading manufacturer of fast food packaging in Malaysia with a market capitalisation of 104.5 million Malaysian ringgit ($26.8 million).
“The acquisition will benefit SCG’s development of fast food packaging for the fast growing consumer demands in Asean,” Mr Roongrote said.
Hoem Seiha, research director at VTrust Appraisal, told Khmer Times that Cambodia’s construction and real estate markets performed well last year, especially low-rise, landed properties and development projects that offer low-price housing units.
However, demand for high-end properties has seemingly slowed down in the last two years, according to Mr Seiha.
“The market performance in 2017 suggests strong confidence in buyers and developers. Middle-income buyers are more likely to look for lower prices or cheap offers. That is the reason the market still achieved a strong growth last year,” he said.
The combined value of approved construction projects reached $6.42 billion in 2017, an increase of 22.31 percent, according to a report from the Ministry of Land Management. Across the country, 3,052 new construction projects, equaling 10.74 million square metres, broke ground.
Moreover, the ministry granted construction licenses to 275 companies, which was a decline compared to last year, when 334 licenses were issued.