Homebuilder Seacon Home Group aims to secure sales growth of 10% this year to 1.3 billion baht, boosted by government investment in infrastructure projects. Managing director Supitcha Chaipipat said the government's spending this year on infrastructure development should help stimulate private sector investment and raise overall sentiment.
"Small and medium-sized enterprises, the traditional buyers of mid-priced houses, are expected to recover this year, in line with the economy, after a few sluggish years," she said.
Crop prices are expected to rise after falling for many years, as indicated by recovering rubber prices, which improved from 100 baht per three kilogrammes to 80 baht per kg.
With an improving economy, risk factors such as high household debt and a high rate of mortgage rejection should ease from last year, said Ms Supitcha. However, only 20%-30% of the company's customers use mortgages.
A rise in the minimum wage should have a very minimal impact on the company's business.
"Our wages exceed the minimum rate. We pay 320-350 baht per day for unskilled labour and 400-600 baht a day for skilled labour," she said.
The group recorded 1.2 billion baht in sales last year, up 6% from 2015. This included sales of 700 million baht from 210 units at its subsidiaries Compact Home Co and Budget Home Co, which tap the lower-priced segment, units priced at 1-4 million baht.
The remaining 500 million baht was from Seacon Home Co, which sells mid-range to higher-end houses priced from 4 million baht, accounting for 40% of the total, down from 60% in the past few years.
Last year's sales performance was expected as the market downshifted, driven by demand from a new generation. The company expects 780 million baht in sales from the lower-priced segment and 520 million from the mid- to high-priced segment this year.
It plans to spend 50 million baht on marketing this year, including 20 million for online, up from 5 million in 2016.
Via: Bangkok Post
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