Arrow ready for smart-home push

Arrow Syndicate Plc, an MAI-listed electrical conduit maker, will invest roughly 30 million baht in developing smart-home solutions and construction management software during the second half of the year.

Managing director Tanin Tanprawat said the change in the company’s business model was necessitated by the surge in use of smartphone applications by people to handle everyday tasks, giving the growth of smart-home business a promising outlook.

He said the company’s ability to both develop and install its smart-home systems for customers involved in condominium business gives it an advantage in terms of lower installation and hardware costs.

“Businesses failing to adapt to Thailand 4.0 will gradually record slower growth, [therefore] we shifted our focus once again to project management projects [for smart-home solutions] last year and an investment worth 30 million baht is expected in a tech startup in this year’s second half,” Mr Tanin said.

As one of the flagship policies of the government, Thailand 4.0 is an economic model aimed at lifting the country into a knowledge-based economy as a new engine of growth and helping its people overcome the middle-income trap.

The investment budget will be channelled into the development of a product installation system, construction management software and information analysis program, Mr Tanin said.

Revenue generated from the company’s new business is expected at 1 million baht this year but is likely to reach 10 million baht next year, he said, adding that the smart-home business has the potential to contribute 5-10% of total revenue.

With more than a 60% share of the domestic electrical market, Arrow has a significant involvement in Thailand’s construction business. Conduits are a basic component required by law and global standards for high-rise buildings.

Arrow grew rapidly after being listed on the MAI exchange in 2012, registering revenue growth above 10% over the past five years.

But Mr Tanin said it would be difficult to maintain such growth figures in the next decade by depending on the construction business alone.

The company expects 10% revenue growth this year, driven by the government’s infrastructure megaprojects with a combined construction value estimated at 2.4 trillion baht this year and close to 3 trillion baht in 2018.

Arrow reported total revenue of 1.36 billion baht last year, up from 1.21 billion a year earlier. Net profit was 266.18 million baht, up from 245.24 million.

Contributors to revenue included electrical conduits (63%), post-tension ducts (17.86%), servicing (11.18%), air ducts (6.67%) and PPR pipe (the remainder).

Arrow also has two subsidiary companies: JSV Technical, the manufacturer and distributor of ventilating conduits, air ducts and post-tension ducts, and Meka-S, which operates as a systems installation contractor.

ARROW shares closed yesterday on the Market for Alternative Investment at 15.80 baht, unchanged, in trade worth 7.8 million baht.