Bangchak to spend B2bn on expansion

Bulk for pump relocation, renovation

Oct 11, 2011
Bangkok Post

The state-owned oil retailer and refinery Bangchak Petroleum Plc (BCP) will spend 2 billion baht over the next five years to improve its oil and non-oil services, says Yodphot Wongrukmit, senior executive vice-president of marketing.

Some 1.5 billion will go to oil pump relocation, pump expansion and other non-oil business. Next year it will expand oil pumps to Laos, Cambodia and Burma.

"We want to improve sales from non-oil to 16% over the next five years from 6% currently in order to lower our risk from oil operations, where the margin has been too low the last several years," said Mr Yodphot.

The sales value at Baichak mini-marts is projected to grow 30% to 1 billion baht this year, increasing fivefold to 5.7 billion at the end of 2016.

The rest of the budget — 500 million baht — will be spent to give 400 Baichak convenient stores an eco-friendly redesign. Its existing 128 shops will get a facelift costing 500,000 baht each, while each new mart will require a 1.2-million-baht budget.

BCP has 1,000 oil pumps nationwide, but only 400 are suitable for Baichak locations due to size and population density.

The company wants to sell more locally made goods, as the new look of Baichak is expected to help double average daily sales to 40,000 baht per day per shop.

Panchaya Chotipitaksiri, owner of Kachornpat Shop, will produce snacks and candy for 92 marts, up from 42 pumps last year. She is a sales agent for locally made candy and snack producers in Pattani, who typically lack the ability to sell in big cities and convenience stores.

"Baichak is the only one that doesn't require a high entrance fee," said Ms Panchaya.

BCP announced it is targeting 30% local products on its Baichak shelves, including One Tambon, One Product (Otop) goods.

Since Oct 1, 25 of its pumps have closed because of flooding in central Thailand. Its sales volume of petroleum is down 2%, or 140,000 litres per day. Its oil depot and solar farm in Bang Pa-in, Ayutthaya reported no damages.

Share of BCP on the Stock Exchange of Thailand yesterday closed at 17.10 baht, up 0.60 baht, in trade worth 129.2 million baht.