Investors have expressed scepticism about the business potential of national energy flagship PTT Plc, which is the target of activists who want to return the company to full state-owned status.
Senior executive vice-president Supattanapong Punmeechaow led a presentation on the company's direction at the Thailand Focus 2014 forum hosted by the Stock Exchange of Thailand (SET) in Bangkok yesterday.
PTT had the SET's largest market capitalisation at 951 billion baht as of Tuesday.
Mr Supattanapong spoke about PTT's structure after its board decided to spin off its pipeline business. He said there was a misunderstanding among certain groups that it generated a lot of profit from a national asset.
In the first half of this year, PTT earned revenue of 1.43 trillion baht, up by 4.7% year-on-year.
"The move of the board to divest is for the sake of transparency. It is also good for rearranging the company's business to improve our efficiency and potential," said Mr Supattanapong.
"PTT will divest some core and non-core businesses to achieve better portfolio management. Everything we are not good at or which causes confusion or misunderstanding of our business model ... we'll either divest it or fix it."
In the short term, PTT plans to turn around underperforming units, spin off natural gas transmission pipeline business, divest refinery business and focus on a new core power-generating business.
In the medium term, PTT will shift from resource-based to knowledge-based organisation, while in the longer term it hopes to improve its return on investment.
Reform of the energy industry will improve PTT's potential, Mr Supattanapong said.
He declined to comment when asked when the government's energy price subsidy would be removed, saying the issue would be discussed under the energy reform plan.
Sukit Udomsirikul, managing director of Maybank Kim Eng Securities, said energy reform would be aimed at improving transparency and efficiency.
The delisting of PTT called for by activists is not possible due to the drastic consequences for many stakeholders such as the stock market, economy, investors' confidence and the government's budget, as it would require huge capital to turn it back to a state enterprise, he said.
PTT shares have fallen by 5.71% from 350 baht before the coup against the SET index, which has gained 20% in the same period. They closed yesterday at 330 baht, down three baht, in trade worth 730 million baht.