JMT Network Services, the SET-listed debt-collection service provider, forecasts 20% of the leasing for the 1 million vehicles under the government's first-time car buyer scheme will turn into bad debt.
"Bad debt will begin to appear around the middle of next year," said chief executive Piya Pong-acha.
He said the company estimates 20% of people will be able to pay in instalments and consequently lose the tax incentive from the Excise Department, as the condition for a tax rebate under the scheme is at least five-year ownership of their first car.
"Bad debt management has plenty of room to grow, and it could translate into an opportunity for JMT to grow," said Mr Piya.
Mr Piya said JMT's fourth-quarter revenue and net profit will be better than expected thanks to the thriving economy.
Newly listed on the SET, the company has raised 300 million baht for business expansion next year.
Mr Piya said JMT projects net profit growth of 30% and revenue growth of 15% next year, while this year's expected revenue will be more than 390 million, higher than projected.
He said several financial institutions have approached JMT for debt-collecting services.
"All potential deals are now in the process of conducting due diligence. Since we've listed, we've become better able to access financial institutions as partners, increasing our business exposure and creditability," he said.
Mr Piya said 80% of JMT's income is from bad debt management and the rest from hire-purchase loans and debt-collection services.
The company targets buying bad debt worth 10 billion baht a year, with a particular focus on personal finance loans.
It will expand to housing loans including houses and condominiums over the next three years.
JMT is a subsidiary of the SET-listed Jay Mart Plc (JMART), the mobile distributor founded by the Sukumvithaya Group.
It started as Jay Mart's debt-collection unit, but its success prompted the parent to upgrade it to a subsidiary.
JMT plans to boost revenue to 1 billion baht over the next five years, when the company can acquire non-performing assets from the new housing and corporate loans.
Shares of JMT closed yesterday on the SET at 11.60 baht, up 50 satang, in trade worth 48.9 million baht.
About the author
- Writer: Nuntawun Polkuamdee
Position: Business Reporter