Thitikorn supports pledging scheme

Higher incomes help lift motorcycle sales

Thitikorn Plc (TK), the SET-listed provider of motorcycle and automobile hire-purchase services in Greater Bangkok, believes the continuation of the government's rice pledging scheme will help to spur the motorcycle market over the next year.

It is also optimistic that company operations will grow as planned, as a new round of major flooding is unlikely to occur this year.

''The rice pledging scheme will directly benefit the motorcycle market in the Central Plains and the Northeast,'' said executive vice-president Prapol Phornprapha.

He said if Thailand avoids another flood crisis and the rice pledging scheme is extended, then the motorcycle market's growth will extend well into next year.

''If the situation remains positive, then Thitikorn is confident operating results in the second half of this year and for next year will definitely be better than in 2011,'' said Mr Prapol.

Thitikorn will revise up this year's motorcycle loan growth target to 15% from 10% now that normal operations have resumed after last year's flood crisis and motorcycle shops maintaining full inventories for fourth-quarter sales.

Mr Prapol said the bike market has recovered steadily since the second quarter.

Some 1.47 motorcycles were in the Thai market in the first eight months of this year, with the full-year figure expected to come in at 2.2 million.

Mr Prapol said this has prompted Thitikorn to revise its overall loan portfolio to 8.7 billion baht this year from 8.3 billion planned before and the original estimate of 7.58 billion made at the end of last year.

Loan growth was 15% as of Aug 31 compared with the forecast of 10%, he said.

Thitikorn's hire-purchase loans totalled 7.96 billion baht in the first half, up by 5.1% year-on-year.

It achieved consolidated revenue of 1.78 billion baht in the first half, up by 10.9% year-on-year, for a net profit of 309 million, down by 2.55%.

Mr Prapol said Thitikorn will open four or five more branches this year.

It operates 80 branches in 46 provinces and will hire 350 new staff for the expansion.

Shares of TK closed yesterday on the SET at 15.90 baht, unchanged, in trade worth 14.8 million baht.

About the author

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Writer: Santan Santivimolnat
Position: Reporter