#PQS #ThanKhun: PQS sends outstanding results for Q1/2023 after the selling price rose to the level of 16.90–17.00 baht per kg after a shortage of cassava production. Receive the benefits of China’s full opening of the country. Chinese customers are lining up to woo them, aiming for revenue growth of at least 10% in 2023 and moving forward to strengthen production facilities.
Mr. Rattavirun Chanchungthaworn, Chief Executive Officer of Premier Quality Starch Public Company Limited, or PQS, a leading producer of tapioca starch in the Northeast, revealed that looking at the overall business in the first quarter of 2023, it is expected that the income will be an expansion from the same period last year. The selling price of general cassava starch (native starch) and modified cassava starch (modified starch) increased.
The average domestic selling price of cassava starch during January–February 2023 is over 16.90–17.00 baht per kilogram. Meanwhile, the average price of cassava starch for export abroad is around 490-500 dollars per ton, higher than the same period last year and from the previous quarter. Normally, in the first quarter of every year, the selling price will be lower than in other periods. With cassava raw materials still in short supply at present, prices are expected to remain stable at a high level until April and May 2023.
Orders flow in.
However, given the high price of cassava production, it is expected that farmers will turn to increasing the amount of cultivation and will begin harvesting in the 3rd quarter of 2023 onwards, which will allow the company to have sufficient raw materials in stock. In addition, the company continues to receive interest from both existing and new customers, especially in China. Traveling to negotiate continuously Reflect on the opportunity to receive new orders. More are coming in 2023.
At present, the majority is exported, more than 70%, and the remaining 30% is sold within Thailand. The main market is exported to China, such as Guangdong Province, Shanghai, Qingdao, etc., accounting for more than 90–95 percent. % of total export volume The company’s highlight is creating product differences, including the production of premium-grade cassava starch. Including the company selling quality cassava flour. Focus on providing fast and timely service. Responding to customer needs directly
In terms of sales volume in 2023, the company expects it to be similar to the same period last year. Due to limited production capacity The investment in the construction of an additional cassava starch factory in the province has a production capacity of 120,000 tons per year. In order to expand the total production capacity to more than 360,000 tons per year and increase the production efficiency of the existing factory, it will be gradually completed within. Late 2023 onwards
**Average profit grew by 25%.
KGI Securities (Thailand) Public Company Limited stated to PQS that the estimated net profit in 2023 will increase by 25% year over year to 390 million baht due to the expected sales volume of tapioca starch, which will grow by 22% year over year to 192,500 tons. The Chinese government announced the opening of the country at the beginning of this year. The company’s main source of income is from exporting cassava to China.
Net profit in 2024 is expected to increase significantly (57% year over year) to 614 million baht from the opening of commercial operations at a modified cassava starch factory in 4Q2023 and a general cassava starch factory with a production capacity of 120,000 tons per year in the first half. In 2024, it is expected that the sales volume of cassava starch will grow by 38% year over year to 265,150 tons next year, while the gross profit margin of the tapioca starch business is expected to be 21.0% and 21.6% in 2023 and 2024, respectively.
At the same time, the department started treating PQS stock with a “buy” recommendation because it has a high CAGR of around 25% in 2021–2024.
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