Thailand’s Mahaphant Group, the largest fiber cement producer in the region, will invest an initial $20 million to set up a manufacturing facility in the Philippines, which it considers to be one of the priority markets in Southeast Asia.
In a briefing Friday, Mahaphant president Sarat Khiatbanlue said the Philippines’ demand for fiber cement products could shoot up to 2 million tons, given an expected demand of 10 million affordable housing units over the next 15 years.
At present, per capita consumption of fiber cement in the Philippines is only 2 kilograms, reportedly one of the lowest in Southeast Asia. The company sees further opportunities in the whole region, estimating market potential at $5 billion.
The expected increase in Philippine demand will be served by the proposed manufacturing facility, which will have an initial capacity of 10 million square meters of board once it starts commercial operations by 2017, said Veerasak Kittinanthakool, VP for marketing of the Mahaphant Group.
The company is expected to complete within the year the feasibility study for the manufacturing plant, which will allow the Mahaphant Group to improve efficiencies in its local operations in terms of services and product offerings, said Kittinanthakool.
The facility, the site of which has yet to be disclosed, will initially produce the fiber cement boards and wood substitute under the Shera brand, he said. Later, it may be further expanded to accommodate the full line of Shera products including fiber cement roof and solutions, which will not only serve the domestic demand, but may also be exported to neighboring countries.
Apart from the manufacturing facility, the Mahaphant Group will aggressively implement promotional activities to push sales of its Shera products.
“Starting this year, we are implementing a full marketing program to expand our distribution network, build customer relationships and communicate brand awareness for Shera in order to penetrate our target segments, including architects, designers, contractors and homeowners,” Kittinanthakool said.
“In our three-year plan of network expansion, we target to open retail outlets in 4,000 stores, qualify 5,000 well-trained carpenters and contractors, and establish a Shera Solution Center as a one-stop service center for our products. We are confident that our more advanced research and development technology, together with our marketing experience, will help us offer better housing and building solutions,” he added.
At present, Shera is the leader in imported fiber cement products in the Philippines, enjoying continuous growth since Mahaphant entered the market in 2008.
Last year, sales reached $10 million, with further growth expected in 2014.
Kittinanthakool said that, to date, sales grew by 30 percent year-on-year. The group hopes to sustain this trend throughout 2014.
The Mahaphant Group ships its products to more than 40 countries in Asia, Africa, Oceania, and Europe. More than half of its international revenue comes from Southeast Asia.
With its three manufacturing plants in Thailand, the company has a total capacity of over 1 million metric tons.
It is also the only player in Southeast Asia with a complete range of green building products.