Bangkok--24 Sep--Siamrajathanee
SO presents its leading and comprehensive outsourcing services in the country, meeting all customers’ demand Organizing a roadshow before offering 85 million shares in IPO to raise funds in the Stock Exchange of Thailand
Siamrajathanee (SO), a leading outsourcing service provider in Thailand, reports the results of the Deloitte Survey which shows the spectacular growth of worldwide outsourcing markets and confirms the trend of government and private organizations turning to outsourcing to boost efficiency and cut operating costs. Its management presents the quality, variety, technology and innovation of its outsourcing services which perfectly meet customers’ demand, facilitate their business and underline its leadership. The Company is expanding its business to meet the outsourcing market that is growing amid economic crises. In the latest development, the Company together with its financial advisor RHB Securities (Thailand) Public Company Limited are presenting information to investors in preparation for its initial public offering (IPO) of 85 million shares.
Mr. Jiranu Kulchanarat, Chief Executive Officer of Siamrajathanee Public Company Limited (SO) – a provider of comprehensive outsourcing services entrusted for over 40 years by government organizations, state enterprises and leading companies in the country, said the Company shared information about its business direction, strengths and growth opportunities with general investors at the Stock Exchange of Thailand on September 23, 2020, in preparation for offering up to 85 million shares in IPO that will account for 27.42% of all its issued and paid-up ordinary shares after the offering of new ordinary shares. Of the IPO offering, 76.5 million shares will go to the public and 8.5 million shares to directors, executives and employees of the Company. RHB Securities (Thailand) Public Company Limited is the financial advisor and the lead underwriter.
Siamrajathanee Public Company Limited has over 40 years of experiences in providing outsourcing services. Currently, SO has two groups of products and services consisting of Outsourcing services and Rental and services. It has raised its brand awareness in the name of SO People for driver, office staff and technician staff management services; SO Next for data entry and processing management services; SO Green for landscape management services; and SO Wheel for car rental services. With its vision of “Siamrajathanee All Solutions One Outsource: Simplify Your Life”, the Company focuses on service variety and quality. It uses customers’ demand as its basis for the continuous development and expansion of its services. The expertise of its quality personnel, technology and advanced databases are facilitating the development of its services that exactly meet customers’ demand. Consequently, the Company had been entrusted by government organizations, state enterprises and large-scaled companies. Among its important customers, the Company has served Toyota group for 15 years, Honda group for 12 years, PTT Public Company Limited for 13 years, Thaioil Public Company Limited for 14 years, the Metropolitan Electricity Authority for 17 years, the Provincial Electricity Authority for 13 years, the Provincial Waterworks Authority for 16 years and the Port Authority of Thailand for 15 years.
During economic crises of the past up until now, choosing outsourcing service in non-core businesses such as administrative and driver services is one of the way to reduce costs and enhance the efficiency of government organizations, state enterprises and large-scaled companies; these organizations are SO’s current customers and positive factors of the Company. The potential and impressive growth outlook of the outsourcing market are noticeable regarding the steady increases in budgets for and value of government contracts for outsourced products and services. In 2019, budgets for the purpose amounted to 230,533 million baht and the value of such contracts was estimated at 215,486 million baht. The figures rose by 14% and 12% respectively from those in 2018. The growth was confirmed by the results of surveys by Monitor Deloitte and Dubai Outsource City which see the trend of global outsourcing services growing by 5% yearly on average between 2019 and 2023, from US$603.8 billion in 2019 to US$731.3 billion in 2023.
Demand for outsourcing services and the Company’s longstanding experiences and business achievements in exactly meeting demand result in customers’ satisfaction, the customer retention rate of about 90% and the annual customer increase pace of at least 12%. Consequently, the business of the Company is robustly growing amid the COVID-19 crisis that has severe impacts on the Thai economy. The Company is thus ready to expand its business further to strengthen its competitiveness in both staff outsourcing and the business of rental and services. The Company plans to field more outsourced staff at the workplaces of its customers, invest more in car rental and further develop its automation technology to simplify and speed up its customer services. The implementation of its business expansion plans is likely to begin between early 2021 and 2023.
The main target groups of customers in the outsourcing services business are government organizations, state enterprises including the Provincial Electricity Authority and the Provincial Waterworks Authority and companies in various fields including finance, insurance, hospital, automobile and parts, food and beverages, steel, property, energy and petroleum.
“We believe that opportunity lies in every crisis and this also applies to the COVID-19 situation. Operators need staff amid the crisis and outsourcing is a way to reduce risks and costs. Tom Yum Kung and Hamburger crises proved to be the factors behind the growth of SO,” said the Chief Executive Officer of Siamrajathanee Public Company Limited.
Mr. Nattaphol Vimolchalao, Deputy Chief Executive Officer of Siamrajathanee Public Company Limited (SO), said the Company will continue to expand the markets of its comprehensive data services, known by the brand of SO Next, to support the digital transformation of organizations in government and private sectors. Its competitiveness is based on its quality personnel, sophisticated software and equipment and systems that meet ISO 27001:2013 which is the international safety standard for data security.
Mr. Khomklit Meekumsat, Managing Director of the Capital Market Department at RHB Securities (Thailand) Public Company Limited, the financial advisor and the lead underwriter, said the operating results and profits of SO were steadily improving. In 2017, the Company generated total revenue of 1,732.32 million baht and a net profit of 116.11 million baht. In 2018, its total revenue amounted to 1,850.88 million baht and the net profit stood at 101.01 million baht. In 2019, the total revenue rose to 1,955.98 million baht and the net profit was at 109.06 million baht. In the first six months of 2020 the Company recorded its total revenue of 1,027.09 million baht and the net profit of 58.99 million baht, rising by 10.57% and 22.79% respectively from the same period last year.
The total revenue in the first six months of 2020 rose on outsourcing services that is the core business generating more than 80% of the total revenue. Revenue from the customers that are government organizations formed approximately 60% of the total revenue from the core business, up from 56% three years ago. The rest customers were in the private sector. SO’s past performance reflect the services of the Company and its customers satisfaction and continuously using the outsourcing services. In addition, SO has a dividend payout policy of at least 50% of its net profit.
SO has a registered capital of 310 million baht with 310 million shares with the par value of 1.00 baht per share, paid up of shares of 225 million equivalent to 225 million baht. The Vimolchalao family holds the majority of the shares. SO intends to raise funds from the IPO to expand its business for the sake of its future growth and to repay its debts with financial institutions.