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Thailand Industrial – Hemaraj’s new tack keeps cash flowing

By on Sep 18, 2014 in Industrial

Hemaraj Land and Development Plc has cut its full-year land sales outlook to 1,200 rai from an earlier 1,600, citing first-half political unrest, but it expects a turnaround soon.  “The political conflict that weakened business confidence and delayed the appointment of a new Board of Investment meant that investment incentives could not be approved, hurting Hemaraj and the overall industrial sector,” said Paopitaya Smutrakalin, director of planning and investor relations.

The newly appointed government has promised measures to stimulate investment in the public and private sectors. “What sets Thailand apart is that foreign companies are allowed to own land in industrial estates, compared with other countries such as Cambodia and Indonesia that only allow long-term leases,” Mr Paopitaya said.

“The first-half performance reflects a strategy to diversify income and alleviate tension from previously relying on weak land sales.”  Hemaraj gets 40% of its customers from Japan, 20% from Thailand and the rest from Europe and the US.  The company is spending 2.4 billion baht on seven small power producer (SPP) plants of 126 megawatts each, up from three plants with a combined 938 MW at present.

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