As the economic ramifications of the coronavirus emergency continue to reveal itself around the world, blue-chip and legacy companies in Thailand have not been spared by the far-reaching pandemic.
Retail, hospitality, manufacturing, industry, it seems virtually every major sector of the Thai economy has been hit hard by Covid-19.
Here is how several major Thai companies have been affected by the virus:
Minor International PCL [SET: MINT]
As one of the largest hospitality companies in the Asia Pacific with over 530 hotels around the world, Minor has been one of the hardest hit companies during the coronavirus pandemic.
International Flights have shrunk by some estimates as much as 97 per cent and hotels have been temporarily shut down across the world.
Minor hotels were not any different and the company has had to engage in some major cost-cutting to stay afloat.
According to a report to shareholders, Minor has had to cut around 60 per cent of staff in their hotels around the world. The company has also reduced costs by up to 30 per cent across suppliers, rentals and payroll with senior management taking massive pay and benefit cuts to help the business.
In Thailand, staff that were not made permanently redundant were either furloughed or asked to take a leave of absence. Multiple-sources from inside the company told Thai Enquirer that many senior staff were asked to voluntarily retire.
Minor’s Press Office has said that the company was facing an unprecedented crisis within the hospitality industry but they have not responded to Thai Enquirer requests for comment on staff redundancy.
Hotel analysts say that the cost-cutting measures by Minor were necessary and were seen in other large hotel groups. Hotel stay and international travel are also unlikely to return until the end of this year or early 2021 due to restrictive measure put in place by countries to avoid a second wave of infections.
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PTT PCL [SET: PTT]
PTT PCL, the state-owned oil and gas giant, said last week that the company would cut its investment budget across the six major companies under its umbrella including its exploration and production arm.
The 10-15 per cent cut will save the company some $1.2 billion US as the company faces declining sales due to pandemic
“The existing projects will go forward but we will have to review and reprioritize future ventures,” Chief Executive Auttapol Rerkpiboon told reporters on Friday.
The demand for oil and natural gas has plunged during the coronavirus pandemic as people were asked to remain home and industries – including the aviation and shipping sectors – cut back costs to offset weakened demand.
Bangchak Corporation [SET: BCP]
Oil retailer Bangchak Corporation predicted that despite the lowered demand for oil in the first half of 2020, the company expects consumer demand to pick up by the end of the year.
Chaiwat Kovavisarach, Banchak’s CEO and President said on Friday that oil sales were down by 10 per cent due to the pandemic in the first half of 2020 with sales dropping by 20 per cent year-on-year in April alone. However, according to the CEO, oil demand should resume in the third and fourth quarters of 2020 as countries reopen their business and industries rush to fill capacity.
Chaiwat said that the group’s investment in Norway producer OKEA [OSE: OKEA] which received a $70 billion US cashback from the Norwegian government will help provide liquidity.
Charoen Pokphand Group [SET: CPALL, CPF, MAKRO]
Charoen Pokphand Group, Thailand’s largest conglomerate, made headlines around the globe when it bought TESCO’s [LON:TSCO] operations in Thailand Malaysia for $10.6 billion US.
The growing coronavirus pandemic and financial concerns meant that as many as nine financial institutions pulled out of financing the deal at the last minute.
Analysts also question the purchasing of legacy brick and mortar store at a time when the global pandemic was changing consumer habits to delivery and online services.
One analyst, speaking anonymously to Thai Enquirer, said that the deal was more a point of pride for the CP Group, who sold the retail chain to TESCO after the 1998 financial crisis, than a prudent purchase.
“It is the wrong time to be spending this amount of money on a retail model that may be obsolete,” he said.
Bangkok Dusit Medical Services [SET: BDMS] Bumrungrad Hospital PCL [SET: BH]
Hospitals around the world have seen an increase in the number of patients during the coronavirus pandemic but luxury hospitals in Thailand have suffered greatly during the emergency.
Both BDMS and Bumrungrad groups rely on medical tourism for much of their revenue and a shutdown of the country’s airspace by the government to curtail the virus have seen the revenue stream dry up.
According to a source inside BDMS, patient numbers within some BDMS hospitals have dropped by as much as 35 per cent.
With the country unlikely to open its airspace to tourism in the near future, including hard-hit Middle Eastern countries which make up a significant portion of medical tourists, the hospitals have undergone a revamp to appeal to a more local clientele.
Both BDMS and Bumrungrad are offering price-reduced health packages with massive discounts for Thais.
Thai Airways International
Thai Airways is due in Bankruptcy court on August 17.
The company is trying to keep its assets from being seized by creditors.
The company says that it cannot refund tickets and has grounded its planes since the end of March.
The company says it will likely have to let go of a significant portion of its workforce.
The government has appointed more government officials to try and make the state-owned enterprise more privately owned.
The company is a mess.