ICHI Reveals a Non-tea Expansion Plan, Supporting Revenue of 9,000 Million Baht

ICHI’s strategic vision includes penetrating the non-tea market segment by introducing the “TAN POWER” energy drink, priced at an accessible 10 baht per glass bottle. This move aims to bolster revenue, targeting an ambitious 9,000 million baht mark and achieving an all-time high in 2024. The green light board grants a dividend of 0.50 baht per share, while ICHI pays 1 baht annually.

Tan Passakornnatee, CEO of Ichitan Group PCL, ICHI, outlines the overview of 2024, setting a revenue target of 9,000 million baht while maintaining an initial profit margin of 23%. Embracing the ready-to-drink market, which is expected to grow further, they introduce new products to expand the non-tea market. They aim to lead the beverage market with products that cater to consumer needs, following the 3N strategy (New Product, New Market, New Business).

The trend for the first quarter of 2024 looks promising, driven by positive economic indicators recovering from continuous government tourism stimulus measures. Additionally, the El Niño effect has resulted in hotter weather than expected. However, it might have a minor impact on Ichitan’s sales compared to the fourth quarter of the previous year, which saw a new high in sales. However, the upcoming hot season is expected to provide substantial support. Moreover, expanding into non-tea markets with products like “Tansansu,” a Korean-style carbonated drink, and “Ichitan Alkaline Water,” enhances overall revenue.

Highlighting the first quarter is the launch of “Tan Power”, an energy drink reinforcing the non-tea portfolio with a 10-baht glass bottle under the concept “No Surrender in Life.” It reflects the DNA of fighters who persevere through life challenges, inspiring those who struggle with its intense, refreshing taste and added B vitamins. The strategy is to distribute through traditional trade channels, which have seen significant expansion, with key partners like DKSH (Thailand), a major distributor, making products accessible nationwide. The sales target is set at 300 million baht for this year.

With good operational performance, Ichitan Green Factory aims for higher production efficiency, targeting a minimum production of 100 million bottles per month in 2024, and accelerating the installation of new production lines to add 200 million bottles per year. This is expected to come into operation by the 4th quarter of 2024, boosting total production to 1,700 million bottles per year (up from the current 1,500 million bottles per year), strengthening the drive towards the sales target of 10 billion baht in 2025, enabling the automation system to work efficiently, and supporting cost savings. This is Ichitan’s strength in maintaining profitability per unit at a good level.

Besides CLMV, new markets are expected for export markets, with an export sales target of 580 million baht. In contrast, the OEM business targets significant clients, especially the IF brand, a key partner, with continuous orders. However, due to total production capacity, the OEM business target is nearly the same level as last year, around 130 million baht.

As for the results of operations in 2023, the company achieved a revenue of 8,050 million baht, up 27% from the previous year’s revenue of 6,340 million baht, and a net profit exceeded the target, with a net profit of 1,100 million baht, up 71% from the same period of the previous year, with an initial profit margin of 23.4%, compared to the same period of the last year, with an initial profit margin of 18.7%, driven by growth in all segments of the Ichitan brand.

The board of directors approved the payment of dividends for the fiscal year 2023 at the rate of 1.00 baht per share, already paid for January 1 – September 30, 2023, at the rate of 0.50 baht per share. The remaining dividend payment for October 1 – December 31, 2023, at 0.50 baht per share, will be paid from retained earnings, with dividend payments scheduled for May 10, 2024.