Eastern Water Resources Development and Management Plc (EASTW), a SET-listed supplier of raw and tap water, has mapped out an aggressive investment plan at home and abroad that includes projects to supply major cities in Myanmar.
The company’s strategy is to seek long-term concessions, says chief executive Wanchai Lawattanatrakul. TAWATCHAI KHEMGUMNERD
The company plans to spend 5 billion baht from 2015-20, said chief executive Wanchai Lawattanatrakul.
Of that amount, 2 billion baht will be used to provide tap water to big cities in Cambodia, Laos, Myanmar and Vietnam.
In Myanmar, Pegu, Myawaddy, Payee and Yangon will be covered at a cost of 1 billion baht.
The feasibility study for the Myanmar project will be finalised in December before Eastern Water starts investment that amounts to 250 million baht for each city.
Myanmar is enjoying rapid economic growth that is attracting foreign investors, particularly to the four cities covered by the water project, Mr Wanchai said.
Based on an Asian Development Bank report, Myanmar's economy is projected to grow by 7.8% in both fiscal 2014 ending next March 31 and fiscal 2015.
Growth is supported by rising investment boosted by improved business confidence, commodity exports, strong tourism and credit growth — all complemented by the government's structural reform programme.
Eastern Water is also seeking opportunities in Luang Prabang in Laos and Kampong Cham and Kampong Thom provinces in Cambodia.
"In Vietnam, we have joined with the local government to study the possibility of supplying tap and raw water to industrial estates in Ho Chi Minh City," said Mr Wanchai.
He said its strategy of expanding abroad was aimed at seeking concessions from local governments to ensure business stability for at least 20 years.
Eastern Water was founded in 1992 by a cabinet resolution, with the objective of integrating raw water management through large water pipes to provide raw water to industry and consumers and support the Eastern Seaboard Development Plan to turn the area into the country’s main industrial zone.
A 40% stake is held by the Provincial Waterworks Authority of Thailand and 4.57% by the Industrial Estate Authority of Thailand.
The company has earmarked 1.5 billion baht to build a raw water pipe from Rayong to Chon Buri province.
Another 1.5 billion baht will be used to build a new pipe along the Andaman Coast.
Over the past 22 years, Eastern Water has spent 6 billion baht to build a 378-kilometre water grid connecting water sources along the Eastern Seaboard such as Nong Pla Lai, Dok Krai and Khlong Yai reservoirs in Rayong, Bang Phra and Nong Ko reservoirs in Chon Buri and Bang Pakong river in Chachoengsao.
The water grid is aimed at supplying raw water to produce tap water for those three provinces.
The company achieved revenue of 3.8 billion baht last year, up by 2.42% from 2012, with 70% from sales of raw water.
In the first half of this year, revenue totalled 2.2 billion baht, but the company is maintaining its full-year forecast of only slight growth due to drought and falling water supplies nationwide.
EASTW shares closed yesterday on the SET at 10.90 baht, unchanged, in trade worth 9.35 million baht.