SEAFCO PCL (SET:SEAFCO): Providing the Foundation for Thailand in a Sustainable Manner
TET: Please explain SEAFCO’s history and its business today.
South East Asia Foundation Company (SEAFCO) started 42 years ago with a team of five people. During this time we expanded with partnerships and independently to become one of the largest bored piling companies in the region. When we first began there was no demand for our skills but because we saw that a developing and developed country has different characteristics and that Thailand was going to require the bored piling technology so we endeavored. Eventually we began with small projects in Sampeng and expanded to doing large projects such as Siam Paragon, Baiyoke, multiple condominium projects and multiple government projects such as the Suvarnabhumi Airport. Today the majority of our business is from bored piles, barrette’s and diaphragm walls and a small portion from civil works. Our customers are either the project owners or the contractors of the project where we act as a sub-contractor. Typically bored piling is 5-15% of a project both in terms of value and length and we manage up to 15 to 20 projects at any given time.
TET: With the planned government infrastructure projects, will SEAFCO aim to be targeting this customer segment?
Since we have been incorporated there is a cycle between private and public projects. Looking back at our history SEAFCO grew from the private sector, from the high rise buildings. I believe that the private sector should lead the country because this is an indication of the economy’s strength. When the private sector is willing to invest and to expand it implies confidence and strength in the economy and when the economy is weak then it should be the public sector that leads. Today we see both the private and the public sector growing which has led to us be questioned why we are not increasing our capacity further. SEAFCO is already one of the largest companies in the region with 47 units of machinery and the length of our projects are typically only 2 to 5 months for private projects or public works that may last up to 12 months. If we were, for example, to double our capacity, it would create stress upon our organisation and in the future when these projects are completed there may not be enough demand left in the market for all of our machines thereby leading to oversupply, price wars and so forth. We do not believe that this is the correct manner in which to grow. We have learnt from our mistakes in the past that it is better to grow in a sustainable manner.
TET: What differentiate SEAFCO from its competitors?
Since we incorporated the company we have always delivered as we promised. So with the combination of the history of the company, the proven track record, the knowledge and experience, customers are comfortable with hiring us for their projects.
TET: What impact does technology have upon your business?
Technology is important for us and we have taken it upon ourselves to share the knowledge that we have accumulated. A reason for the western countries being more successful than us is because they share their knowledge allowing their people to learn and grow to the next level. At SEAFCO we have published what we have learnt in local and international publications as we want to share our knowledge as well. This indirectly has assisted us as well because world class designers and contractors notice what we publish and contact us to help them with their projects in Thailand.
TET: SEAFCO has begun expanding internationally, what is the rationale for this?
We have done international projects in the past such as the Marina Bay Sands project in Singapore, however we learnt a tremendous amount from that experience as SEAFCO is not comfortable in a market such as Singapore because that market does not require our technology, management nor funding. From this lesson we decided to focus on markets such as Myanmar which we established three ago and have machinery located there already and Cambodia which we expect to start in 2018. We expanded to Myanmar before the AEC started because we wanted to be prepared for customers from Thailand that may expand there, with the AEC the movement of machinery, people and capital has improved and we believe that it will continue to improve the ease of doing business. These markets have a need for our technology, management, and funding and we expect to see contractors and real estate developers from Thailand expanding there as well.
TET: Where do you see SEAFCO in the next five years?
In the future we will to have diversify our businesses into areas such as civil works to ensure a continual growth path for the company. Bored piling will remain as the core business but we will look at businesses that are related to our current expertise. In reality we do not have to focus on expanding to other countries and other businesses because today the infrastructure projects are targeting the entire country. In the past infrastructure projects were typically focused in Bangkok and outer Bangkok, but today with the government’s focus on multiple provinces there will be plenty of work available in the country. However to ensure that our company can continue on a sustainable growth path we will look at other markets and business opportunities to prepare ourselves for the future.
Source: ACN Newswire