TU launches domestic brand

TU launches domestic brand

SET-listed Thai Union Group Plc (TU), the world's biggest producer of canned tuna, expects sales growth of 15% this year, largely because of organic growth.

Rittirong Boonmechote, the company's president of global frozen shrimp and related units, said the company forecasts sales of 150.8-154.1 billion baht, up from 130 billion in 2016.

Mr Rittirong attributed the growth outlook to expansion of existing tuna and seafood businesses, as well as innovations that could lead to new products with higher value this year.

The company will conservatively invest in new projects this year, as it set aside just 25 billion baht for investment budget after splashing out on overseas acquisitions the past few years, he said.

Of the total, Thai Union will spend 50 million baht promoting its new frozen seafood brand, Qfresh, which launched yesterday.

Mr Rittirong said Qfresh is the first seafood brand the company has introduced in the Thai market since Thai Union's founding 40 years ago.

Sales of Qfresh are expected to reach 300 million baht this year, rising to 1 billion baht over the next five years, he said.

The Thai domestic frozen seafood market is worth about 20 billion baht a year. Thai Union decided to jump into the market because it saw an opportunity for growth.

Mr Rittirong said the company specifically sees greater chances to grow via the e-commerce market, which is skyrocketing.

According to the Electronic Transactions Development Agency, Thailand is becoming a leading e-commerce country, with the value of electronic trade rising to 2.2 billion baht from 2.1 billion in 2015.

Of the 2.2 billion baht in value, some 20% came from retail business, of which frozen seafood comprises 2-3%.

"The trend of seafood consumption is growing quite well worldwide," Mr Rittirong said.

"As a global seafood company, Thai Union sees a huge opportunity to bring premium and fresh seafood from around the world to Thai consumers at affordable prices."

He called the launch of the Qfresh brand an important step in helping the company thrive in the domestic frozen seafood market.

The move is part of a plan to expand Thai Union's business to increase this year's total sales by 15%.

Thai Union posted a net profit of 5.3 billion baht in 2016, a slight decrease from 5.4 billion the previous year.

TU shares closed yesterday on the Stock Exchange of Thailand at 20.90 baht, down 10 satang, in trade worth 265.7 million baht.

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