Applied DB or ADB expands to new foreign markets and moves to increase production of adhesive and sealant products while lifting its R&D team’s capability to support growth

Thursday 09 November 2017 11:58
Applied DB Public Company Limited or ADB, the leader in adhesive, sealant and plastic compound, targets new markets overseas and is accelerating the construction of a new factory that is expected to be completed and ready for operation in the fourth quarter of 2018. The plant will boost production of adhesive and sealant products by another 13,590 tons per year and will expand the market for sealant products which have good gross profit margin. The company is also in the process of carrying out research and development on new products with added value such as PVC compound for the medical industry and halogen-free plastic that are friendly to the environment. Company executives reveal that net profit for the third quarter of 2017 went up 524% from the previous quarter.

Mr. Wang Wanapaison, the Chief Executive Officer of Applied DB Pcl or ADB, the leading producer of adhesive, sealant and plastic compound, announced the company's first day of trading on the Market for Alternative Investment (mai) on 9 November 2017, using the abbreviation "ADB". He believes it will receive a lot of attention from investors who are confident in the company's potentials and business operation, as well as its investment expansion plan to build future growth, following good response to its Initial Public Offering (IPO) prior to this.

ADB has the goal of expanding new client base overseas, namely customer groups in the ASEAN Economic Community (AEC) countries, while looking to increase sales channels among its existing customer groups in Africa and Asia, which are still markets with potentials. Currently a new factory is being built in Samut Prakan under an estimated budget of 230 million baht. It will produce four types of adhesives and sealants. Two of them are new products – silicone sealant and modified silicone polymer for sealing, and the other two are existing products – acrylic grout and glue substitute (construction adhesive). Sealant products have a good gross profit margin and it is expected that the new plant will begin commercial production and distribution in the fourth quarter of 2018 and will reach full production capacity in 2020. The four products mentioned above will have an additional combined production capacity of 13,590 tons a year.

At the same time ADB is carrying out research and development on compound plastic, including PVC compound for the medical industry, which can be used to produce medical equipments in preparation for Thailand's entry into an ageing society, and halogen-free plastic to produce electrical wires and cables that yield low toxicity when burnt. This is in response to the demand for plastic products that are environmentally friendly.

Meanwhile, third quarter performance for 2017 (July-September) recovered strongly compared to the previous quarter with total revenue of 355.17 million baht. Though this is a small decrease of 6.06% on the previous quarter but there is a net profit of 9.44 million baht, or an increase of 524% on the previous quarter. The result was made possible by the ability of the company to effectively control costs. Furthermore, the company believes that it has already passed through its lowest performance patch in the first half of the year and is returning to better operating conditions as recently seen and that this will keep improving due to business expansion under its business plan.

"The direction of ADB operation will target new markets especially foreign markets and we will closely follow changing demands for our products in order to develop new products that answer to what is being demanded by the market. At the same time we will use the strength of our R&D team which is ready to work for clients to develop products that meet their individual needs," Mr. Wang said.

Mrs. Sunit Visuthikosol, Managing Director for Investment Banking, RHB Securities (Thailand) Pcl, in her capacity as financial advisor and lead-underwriter, said she is confident that ADB is a company with good potentials for future growth and that its shares will capture the attention of investors because it has a team of experienced executives who have been in the business for more than 30 years and has a far-reaching vision. They have laid down a strategy that focuses on developing new products that offer good profit margin or are innovations with added value, in order to explore markets where competition is not fierce or has few product developers.

ADB also stands ready with a variety of products and services as a one-stop service outfit. Its strength is that it has an R&D team that constitutes the essential key for developing new products to directly respond to market demands or to develop products that meet the specific needs of each client. This will give it the advantage to compete both domestically and abroad.