NER Sees Booming of Livestock Rubber Mat in 2023 as GPM Expects to Surpass Core Segment

Mr. Chuwit Jungtanasomboon, Chief Executive Officer Director of North East Rubber Public Company Limited (SET: NER) revealed the overall outlook of the company on Opportunity Day by the Stock Exchange of Thailand (SET) on December 6, 2022, stating that the company is monitoring for a clearer direction of the global economy as it is an indicator of potential demand for rubber in the market to expand investment. The CEO believed that in the future, small businesses in production and distribution of rib smoked sheet (RSS), block rubber, and mixtures rubber products will disappear and it is an opportunity for larger operators in the market.

In 2023, the company set an investment budget of approximately THB 400 million, divided into THB 100 million for machinery improvement to increase production capacity by an estimated of 15% in April 2023, and THB 300 million will be invested in research and development (R&D), which should have seen an increases in downstream products in 2023.

In 2023, the performance trends of the company set the target of 500,000 tons of sales revenue, approximately THB 30,000 million. This year is expected to record sales of around 460 billion tons or THB 2.6-2.7 billion in revenue. The strategy is to increase marketing in  the Indian market, expecting the sales volume will be 50,000 tons per year or 10% of overall portfolio after signing with 5 new customers.

In addition, from the first quarter of 2023, the company will fully focus on exporting livestock rubber mat, while the first customer orders are ready to deliver to Japan for 20 tons. After sending the product to the customer for testing and adjusting the production according to customers’ demand, the company expected the revenue from this segment will be THB 300 million in 2023, an increase from less than THB 10 million of the revenue in 2022. Moreover, the gross profit margin for this segment is higher than NER’s core segment at the moment.