Delta delays Bangalore plant

SET-listed Delta Electronics Thailand Plc, a producer and distributor of power management solutions and electronic components, has delayed the construction of its second factory in Bangalore for a year due to an inconclusive land acquisition process, says president Dick Hsieh.

The company had planned to start construction of the plant in the Indian state in the third quarter of this year to meet rising demand for electronic components for electric vehicles (EVs) in India.

“We can’t start construction of the Bangalore plant this year. But we are trying to minimise the effects of the delay, which will only be short-term,” said Mr Hsieh.

Delta Electronics had expected 50% revenue growth in India from last year’s total revenue of US$200, with the government’s policy to promote EVs, the reason the company decided to build the new plant.

Anusorn Muttaraid, executive director, said the company plans to rent a factory until the new plant is built.

“This would help increase productivity even when the new plant is not ready yet,” he said.

Mr Anusorn said the company would still maintain its focus on Asean countries, India and Australia, where demand is expected to grow substantially, particularly for EV components.

Indonesia is another country the company is eyeing. The company has done a feasibility study to invest in the country, where demand is potentially high from its population of more than 260 million.

Mr Anusorn said Delta expects total revenue of 50 billion baht this year, up from 46.8 billion in 2016, thanks to strong demand in the Asean and Indian markets. In 2018, the company expects total revenue to grow by 10% year-on-year.

He said the company is also interested in investing in robotics and a data centre in the East Economic Corridor.

“We are developing robotics technology and plan to produce robots in the near future to supply both the Thai and foreign markets,” he said.

The company reported revenue of 36.6 billion baht in the third quarter of 2017, up 7.3% from the same period of last year. Net profit was at 3.6 billion baht, down 9.6% from the previous year due largely to the stronger Thai baht.

DELTA shares close on the SET on Wednesday at 87.25 baht, up 25 satang, in trade worth 32.6 million baht.