Siam Cement Group (SCG) is diversifying into corporate venture capital (CVC) after setting up a new subsidiary, AddVentures, to invest in Thai and foreign startups.
Mr Roongrote is eyeing HVA goods.
President and chief executive Roongrote Rangsiyopash said the CVC is a new investment trend the company is targeting as part of its focus on innovation.
"We are confident that SCG is on the right track when it comes to pursuing innovations to help add value to our existing products and be more competitive on the world stage," said Mr Roongrote.
The company already has a CVC investment strategy, with a focus on investing in new startups that are related to its core businesses -- cement, petrochemicals and building materials.
"SCG will be the first industrial company in Thailand and Asean investing through CVC and we hope the move will help inspire other major companies to follow suit and support new startups," said Mr Roongrote.
Yuttana Jiamtragan, vice-president for corporate administration at SCG, said the investment budget for CVC will be 300-500 million baht. For the first year of investment, the amount will be added to the annual 4.5-billion-baht R&D budget.
But because CVC is on the rise, the R&D budget set aside for it should rise to 2-3 billion baht over the next five years, said Mr Yuttana.
He said AddVentures has begun negotiating with Thai and foreign startups and expects to close at least five deals a year.
"Initially, the budget for each deal should be around 1 million baht," said Mr Yuttana.
He said investing in new startup companies would help drive innovation and create higher-value-added (HVA) goods, which is a part of the company's major strategy to produce more HVA-grade industrial products instead of commodity-grade ones.
"We have started talking with 5-6 start-up companies and we expect that around 2-3 deals should be sealed by the end of the year," said Mr Yuttana.
SCG posted a net profit of 17.4 billion baht in the first quarter of 2017, up 29% year-on-year.
SCC shares closed yesterday on the Stock Exchange of Thailand at 520 baht, up four baht, in trade worth 749.4 million baht.