54
Annual Report
2013
1.2 Operational Adjustment
to Address the Changing Situation
The Company has adjusted its strategic
plan and planned to increase production capacity
target in its local and overseas operations to
maintain competitiveness and position as leading
independent power producer in Thailand and Asia
Pacific. The Company has studied a variety of types
of power plants, including coal power plants,
hydro power plants, natural gas power plants
and renewable energy power plants, both small
and large scale. Joint investment has been made
in new projects and already existing projects. In
addition, the Company is looking for opportunity
to invest in related businesses, such as coal mine
and power plant operation and maintenance
to reduce risks related to fuel and power plant
operations and maintenance costs.
As the Company did not participate in
the bid for the IPP project in 2013, the Company
has hired a renowned international consultant
company to prepare a new strategic plan for
2014-2023 period for sustainable growth. New
strategies are as follows:
- Increasing overseas investment, focusing
on investment in neighboring countries and selling
electricity back to Thailand and AEC countries with
high potential
- Seeking opportunity for more investment
in the country through SPP, renewable projects,
related business and acquisition
- Seeking business partners to increase
investment capability in Thailand and overseas
- Ensuring investment balance between
new projects and acquisition for sustainable
growth
- Expanding investment into related
business, such as transmission system, power
plant operation and maintenance services
- Preparing short and long term financial
plans to support investment and strengthen
financial position
The Company has given higher weight
to efficiency in financial cost, in-depth project
analysis and ability to maintain corporate credit
rating and confidence at high level to ensure that
the Company is well recognized and has strong
capability to invest in new projects
1.3 Competition
Being a leading IPP, the Company’s
production capacity accounts for 14 per cent of the
country’s total electricity generating capacity. The
Government’s policy to support more investment
in electricity generating sector has encouraged
more private companies to invest in this area,
resulting in higher competition and challenges.
However, the corporate analysis shows that the
Company is very strong in terms of business
expertise, highly experienced personnel, business
partners both in terms of project operations and
loan sourcing, liquidity and source of capital. These
encourage the Company to be very confident in
its ability to maintain competitiveness.
2. Financial Risks
2.1 Risk Related to Interest Rate
The Company has constantly studied
and monitored interest rate trend and factors
affecting interest rate to support its consideration
on fund sourcing and planning for the right time for
capitalization. The Company also considered fixed
or floating interest rates according to the nature
of each project. In 2013, the Company’s Group
has cost-effectively sought short and long-term
loan for now projects. Hedging instruments have
been adopted to reduce risks related to interest
rate fluctuation.
2.2 Risk Related to Foreign Exchange Rate
To ensure that the management of
impact from foreign exchange rate is efficient, the
Company has prepared exchange rate fluctuation
management by revising financial structure of
the Company and projects to better address the
