GC CEO reveals vision to advance 3 Steps Plus and make Map Ta Phut a SE Asia hub

GC’s approach focuses on maintaining its strong fundamentals, strengthening its competitiveness, creating new synergy, and optimizing its business portfolio by growing its High-Value & Low-Carbon Businesses in local and international markets through Allnex and NatureWorks.

Meanwhile, the company aims to build growth opportunities for Map Ta Phut industrial estate and develop new strategic partnerships to cater to megatrends in the future of the industry to position its Map Ta Phut plant as a Southeast Asia hub, while collaborating with PTT Group companies in carbon capture and storage (CCS) project and developing it as a future business.  

Narongsak Jivakanun, Chief Executive Officer of GC said "Taking the next step in our sustainable growth journey, we will continue our 3 Steps Plus strategy, which includes Step Change, Step Out, and Step Up, to strengthen our growth and competitiveness in line with changing situation. We will leverage and build on our innovation capabilities, expertise and experience in chemical and bioplastic production to meet the needs of new industries and global trends.” 

The Step Out strategy, which focuses on international business growth, plays a crucial role in the company's future expansion. The high-value and Low-Carbon businesses, meanwhile, will expand their market reach and develop innovative chemicals through Allnex, which has 34 coating resin plants worldwide.

Building on Allnex's success in establishing China Hub, a similar hub has been developed to expand its production base in markets with high growth potential, including the Mahad plant in Maharashtra state, India, to be followed by the Map Ta Phut plant in Thailand, which is positioned as Southeast Asia Hub focusing on producing coatings for industries with high growth potential, including automotive, electronics and semiconductors, packaging, industrial metals, furniture and special decoration.

Meanwhile, the Bio and Green businesses operated through NatureWorks, the world's largest producer of polylactic acid (PLA), an important raw material for producing compostable plastic pellets for various applications, including coffee capsules, tea bags, and 3D printing materials owing to its performance and sustainability attributes. GC, which holds a 50 % stake in NatureWorks alongside Cargill, is developing an integrated PLA production facility in Nakhon Sawan Province (Nakhonsawan Bio Complex – NBC) set to be completed in 2025. 

This will be Thailand's first bio complex with an annual production capacity of 75,000 tons, utilizing cane sugar as its raw material. The facility will strengthen Thailand's bio-green capabilities, create opportunities for the agricultural sector, and further develop the country's economy. The complex will aid Thailand in becoming a production and export base for bio-chemical materials in Southeast Asia while meeting increased demand for sustainable innovation.

As part of the Step Up strategy, GC will continue to integrate circular economy principles into its operations, guided by ESG (Environmental, Social, and Governance) principles. The company aims to achieve net-zero greenhouse gas emissions by 2050. Practical measures include collaborating with PTT Group companies on carbon capture and storage (CCS) projects in both conducting a study on carbon capture technology through corporate venture capital (CVC) investment and a feasibility study on the application of blue/green hydrogen and development of a business model for future commercialization. 

Toasaporn Boonyapipat, President of PTT Global Chemical Public Company Limited (GC), elaborated on the role of the Step Change strategy. "To enhance our competitiveness and maintain a strong business foundation, we will focus on continuously improving the operational efficiency of our plants in the Map Ta Phut Industrial Estate. This will reduce production costs, minimize environmental impacts, and optimize the value chain. Better operational efficiency will also enable us to support the development of high-value chemical products through future collaborations with partners. This is our way of comprehensive investment management for sustainable growth." 

Q1 2024 Financial Results

In the first quarter of 2024, GC reported a total sales revenue of 155,187 million baht, primarily driven by aromatics and olefins products. The company recorded a core operating profit of 703 million baht, an increase from the previous quarter. Recognizing that net operating loss is recurring and that extraordinary items have been recorded, the company reported a net loss of 606 million baht. This reflects GC's ability to navigate and operate business in uncertain situations and conditions effectively.

Outlook for GC's Growth in the Second Half of 2024

1. High Value, Low Carbon Businesses

Expanding the business through allnex in line with GC’s business portfolio adjustment to increase revenue share from high-value products, which requires advanced innovation and production technologies.

2. Enhance investment opportunities in Map Ta Phut to accommodate investment and economic growth in Southeast Asia

With an economic recovery underway and the region's GDP projected to grow by 4.6 per cent, GC plans to explore and develop new strategic partnerships to attract investment in High Value/Specialty Chemicals businesses to support investment in manufacturing industries potentially opting for Southeast Asia as their production base.

"The Map Ta Phut Industrial Estate's strengths in infrastructure and its strategic location as an export hub to Southeast Asia and the global market have attracted significant investments in advanced industries in Thailand and neighbouring countries. Furthermore, the per capita chemical consumption in the region has significant growth potential compared to other continents. GC can meet the chemical needs of customers and collaborate on developing new products for various industrial customers across sectors, creating business opportunities for the company," Narongsak explained. 

The 3 Steps Plus strategy has driven GC's sustainable business success, earning the company numerous national and international accolades. GC is the only company globally to be ranked top in the chemical sector in the Dow Jones Sustainability Indices (DJSI) World Index for five consecutive years by S&P Global. Most recently, GC was recognized as the only Thai company in the chemical sector and one of seven Thai organizations out of 350 in the Asia-Pacific region to be named an Asia-Pacific Climate Leader 2024 by the Financial Times, based on data analysis by Statista. These recognitions underscore GC's commitment to becoming a low-carbon organization.