CRC sees bright future for retail trade

CRC sees bright future for retail trade

Central Retail Corporation Plc (CRC) board members and executives celebrate the first trading day of the CRC IPO on Thursday. They include, from sixth left, Stock Exchange of Thailand president Pakorn Peetathawatchai; Chaiwat Wibulsawat, chairman of the Stock Exchange of Thailand; Prasarn Trairatvorakul, CRC's chairman; Suthichai Chirathivat, CRC's vice chairman; and Suthikiati Chirathivat, CRC's vice chairman. photos by NATTAPOL LOVAKIJ
Central Retail Corporation Plc (CRC) board members and executives celebrate the first trading day of the CRC IPO on Thursday. They include, from sixth left, Stock Exchange of Thailand president Pakorn Peetathawatchai; Chaiwat Wibulsawat, chairman of the Stock Exchange of Thailand; Prasarn Trairatvorakul, CRC's chairman; Suthichai Chirathivat, CRC's vice chairman; and Suthikiati Chirathivat, CRC's vice chairman. photos by NATTAPOL LOVAKIJ

Central Retail Corporation (CRC), Thailand's largest retailer and the retail arm of Central Group, is upbeat about its business prospects as it launched the country's largest-ever market capitalisation offering on the Stock Exchange of Thailand (SET) on Thursday.

CRC launched its initial public offering (IPO) on Thursday despite business sentiment being blighted by the Covid-19 epidemic. The share price moved in a range of 41.50-42.25 baht with turnover averaging 7.5 billion baht.

CRC is raising 78.1 billion baht in funds, the world's second-largest retail capitalisation offering, after setting a share price of 42 baht for no more than 1.69 billion IPO shares and an over-allotment option of 169 million shares.

First-day trading marked a record in the Thai capital market, at more than 253 billion baht. The SET said the impressive performance meant CRC will be traded on the SET50 and SET100 from Feb 25, replacing Banpu Power Plc and Asia Aviation Plc respectively.

Becoming a listed company would help CRC progress thanks to an ability to raise funds more easily and expand its asset acquisition both in Thailand and internationally, said Yol Phokasub, CRC's chief executive officer.

The company will now focus more on ramping up its business in Thailand, Vietnam and Italy, said Mr Yol. "Notwithstanding volatile economic conditions that may affect consumers' shopping sentiment for a period, we remain confident of driving growth in our business as planned because we have diversified platforms and have already built an ecosystem in each country to expand our business,'' Mr Yol said.

The company sees huge opportunity for expansion in Vietnam, where GDP growth is higher than Thailand's but the modern retail business is still 10 years behind, he added. Modern retail trade contributes only about 10% of Vietnam's total retail business, compared to 45% in Thailand.

"It remains highly possible that the modern trade business in Vietnam will be on par with Thailand in the future," Mr Yol said, adding that the company had to build strong Vietnamese foundations in three areas, namely food, non-food and property. The company will first focus on expanding its food business, providing separate formats to respond to customers in urban, semi-urban and suburban areas.

On the domestic front, Mr Yol said the company would progress with its strategic plan for long-term growth, but with more caution to prevent risk. This year, the company will set aside about 25-30 billion baht, on par with last year's investment, to open new outlets and renovate existing premises beyond the level of department stores and supermarkets. The company plans to open three or four new Robinson Lifestyle malls this year. Robinson Department Stores will be transformed into Central Department Stores in certain areas to suit urbanised conditions.

Mr Yol said the company's business had not yet suffered much impact from Covid-19, adding Chinese visitors represented only 5-6% of its shoppers. Nonetheless, he suggested it was time for the government to adjust import tax to lift local firms' competitiveness.


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