SCG Packaging Plc (SCGP) is sharpening its focus on Southeast Asia as a key growth market, supported by resilient regional demand and improved operations in Indonesia and Vietnam.
“Vietnam and Indonesia are our rising stars, driving SCGP’s future growth. Vietnam, in particular, offers strong ease of doing business,” said chief executive Wichan Jitpukdee.
“Demand for packaging in Southeast Asia is set to keep rising, especially in the food, beverage, and consumer goods segments.”
The company posted a third-quarter net profit of 953 million baht, up 65% year-on-year, driven by lower raw material and energy costs, efficient cost management and stronger performance from its Indonesian subsidiary, PT Fajar Surya Wisesa Tbk.
Total revenue for the quarter stood at 30.4 billion baht, down slightly from the previous year due to lower average selling prices, though profitability was bolstered by cost savings and regional contributions.
He said the company’s operations remained steady despite weak global demand.
“The decline in energy and raw material prices has supported our profitability, while contributions from our Indonesian business have strengthened overall performance,” said Mr Wichan.
In the packaging paper segment in Indonesia, local producers expanded output to replace Chinese imports, creating competition. Nonetheless, Fajar maintained positive earnings before interest, taxes, depreciation and amortisation through disciplined cost control.
He said exports to China have dropped, with India emerging as a promising new market.
Mr Wichan said the positive outlook is supported by government stimulus measures aimed at spurring consumption, as well as robust GDP growth in key markets including Vietnam and Indonesia.
“Inventory replenishment towards the year-end is also expected to drive stronger sales in the second half,” he said, adding SCGP is expanding exports to promising new markets such as India.
For the fourth quarter, SCGP expects to finalise a merger and partnership deal with Indonesia’s MYPAK by December to strengthen its consumer packaging portfolio and integration with Fajar.
“Seasonal demand should improve in the final quarter, supported by inventory restocking, government stimulus, and tourism,” Mr Wichan said.
He said SCGP’s rigid packaging expansion plan in the US remains on hold due to labour shortages.