Thai Beverage Plc, Thailand's largest food and beverage company, is ramping up its white spirits expansion to cover Asean and North Asia, hoping to capitalise on the mass market in those regions.
The move is also part of ThaiBev's 2020 vision to become a stable and sustainable Asean leader in the beverage and food industry, with non-alcohol sales contributing 50% of the company's revenues in three years, up from 40%.
Chief executive Thapana Sirivadhanabhakdi said ThaiBev is debuting Ruang Khao premium white spirits in Asean and North Asia.
The company already set up a subsidiary called International Beverage Holding Co in Hanoi, Vietnam last year to distribute Ruang Khao.
ThaiBev is in the process of acquiring a distribution licence in Vietnam and expects to start selling Ruang Khao in Vietnam early next year and in South Korea and Japan by the end of next year. Myanmar and the Philippines will also be in the business' pipeline. Apart from Ruang Khao, ThaiBev's Old Pulteney scotch whisky will also be made available in Vietnam.
Spirit Product Group chief executive Prapakon Thongtheppairot said the company's plan to enter Vietnam, the Philippines and Myanmar was formed to capitalise on the large market for white spirits.
The company has upgraded Ruang Khao's formula and packaging, which is scheduled to relaunch in the Thai market this November as Ruang Khao Silver before expanding into Vietnam.
Ruang Khao Silver is being positioned as a premium white spirit, priced at 168 baht per bottle, while the original Ruang Khao white spirit remains available in the market at 120 baht per bottle. Ruang Khao Silver is distilled and bottled by Red Bull Distillery (1988) Co in Samut Sakhon province.
According to International Wine and Spirit Research, the top three spirits brands worldwide in 2015 are Jinro Shochu of South Korea, followed by Officer's Choice whisky of Allied Blender's Distillers and Ruang Khao white spirit from ThaiBev.
ThaiBev has three groups of spirits in its portfolio -- four brands of scotch whisky, two premium gin brands for the international market and over 10 white spirit brands in Thailand, including Ruang Khao, Mungkorn Thong and Blend 285.
"We will have our own white spirit operations in Myanmar and a distributor in the Philippines," Mr Thapana said.
ThaiBev's food business chief executive Nongnuch Buranasetkul said the group has set a long-term target to grow food business sales to 12-18 billion baht by 2020 from 6 billion through expanding stores and the product portfolio both in Asean and Thailand.
As part of the expansion plan, ThaiBev through Food of Asia Co has bought a 76% stake in Thai restaurant chain Spice of Asia for 114.5 million baht.
Spice of Asia runs 10 restaurants under four brands -- Cafe Chilli, Chilli Thai Restaurant, Eat Pot and Pot Ministry -- serving Thai food and hotpot concepts. The acquired stake will be held by ThaiBev's wholly owned subsidiary Food of Asia Co.
ThaiBev reported revenue of 142 billion baht for the period between October 2016 and June 2017, down 6% from the same period the year before.
Net profit for the period rose by 3.1% to 21.1 billion baht.
"We are still positive about Thai economic prospects because the country has good economic fundamentals and the government has come up with myriad stimulus packages, while Asean is the fastest-growing region in the world," he said. "Nonetheless, the geopolitical situation in North Asia is volatile."
Mr Thapana said the company has increased its investment budget by over 2 billion baht to 7.4 billion for the period from Oct 1, 2017, to Sept 30, 2018 to expand its business, enhance efficiency and upgrade manufacturing.