RPCG segues from refining into property

SET-listed RPCG Plc (RPC) is focusing more on the property sector now that its refinery revenue has dried up.

Chairman Satja Janetumnugul said in readjusting its business direction over the past three years, the company had decided to diversify into property as a major focus.

RPCG, whose former name was Rayong Purifier Plc, recently paid 400 million baht for an additional 25% stake in property developer Sammakorn Plc, raising its ownership to 48%.

Mr Satja said the company’s oil revenue had declined significantly since 2012.

At that time, its oil refinery in Rayong’s Map Ta Phut was permanently shut on termination of a 15-year purchase contract for raw material from PTT Global Chemical Plc.

Since then, the company has served as an oil retailer and distributor to 70 filling stations nationwide.

It also receives a cash dividend from its stake in Sammakorn.

“After acquiring the additional Sammakorn shares, we expect that company will be our major property arm from now on,” Mr Satja said.

Sammakorn is a SET-listed property developer with more than 40 years of experience in premium housing projects.

This year it plans to launch three major projects in Bangkok, on Chaiyaphruk, Rattanathibet and Kubon roads.

“We feel the property business can benefit us more than energy can, so we’ve decided to go more with this sector,” Mr Satja said.

He said property was expected to generate half the company’s annual revenue by 2017 and the remaining oil retailing business the other half.

Also by 2017, group revenue is expected almost to double to 8 billion baht from 4.5 billion last year, when property amounted to 25% and oil retailing 75%.

RPCG has announced capital expenditure of 1 billion baht this year, most of it earmarked for Sammakorn.

The company has been involved with Sammakorn since 2009, when they formed a joint venture called Pure Sammakorn Development Co to build a community mall and three filling stations.

“We want to integrate our professional energy and property businesses,” Mr Satja said.

With its refining operation now shut down, RPCG plans this year to sell its oil refinery unit, which is worth an estimated 200 million baht.

The present 33-rai site of the oil refinery is expected to be developed into an exhibition and convention centre.

However, details of the project have not been disclosed, as it is still in the design stage.

Mr Satja said the company would also still consider other types of energy business ranging from fossil fuels to renewables.

RPC shares closed yesterday on the SET at 1.21 baht, down four satang, in trade worth 16.8 million baht.