Two large producers of ceramic tiles -- SCG Ceramics Plc and Dynasty Ceramic Plc -- will open new stores and expand existing outlets nationwide as domestic demand recovers, following the country's reopening.
Numpol Malichai, managing director of SCG Ceramics Plc, said demand for ceramic tiles in Thailand was positive in the first quarter of this year, largely due to a market recovery after the government eased lockdown measures.
"The country's reopening with more relaxation [since May 1] will boost the economy and all industries," he said. "The ceramic business may not grow at a fast pace, but construction in the tourism sector will gradually resume in the medium to long term."
In the first quarter of 2022, SCG Ceramics had year-on-year growth of 13% and quarter-on-quarter growth of 23% in sales of ceramic tiles, with a total volume of 20.1 million square metres.
Mr Numpol said the company will expand its Klang Ceramic outlets from the current 73 stores to 100 by the end of 2022, after sales from these outlets rose 32% in the first quarter of this year from the same period of 2021.
"A good momentum in the first quarter was from the final quarter and it will continue through the remainder of this year," he said. "However, risks of the unexpected surge in inflation may affect demand and will eventually hit our growth."
He said inflation might worsen due to the Russia-Ukraine war, which has created a fluctuation in energy prices.
Pushed by higher fuel prices, the average price of the company's ceramic tiles rose two baht per sq m to 155 baht in the first quarter, from 153 baht in the same period last year.
However, the price dropped from 157 baht in the fourth quarter of last year as the proportion of sales from export markets grew from 22% to 25% in the first quarter, particularly in Myanmar where its main products had dropped in price, said Mr Numpol.
"CLM [Cambodia, Laos and Myanmar] markets are expected to recover in the remainder of the year, following the global economy, but we need to keep monitoring risks from political uncertainty in Myanmar," he added.
Maruth Saengsastra, chief executive of Dynasty Ceramic Plc, said exports to Myanmar doubled in the first quarter of this year as demand recovered.
"CLM markets have greater potential," he said. "Many more local dealers from those countries want us to introduce our products."
The proportion of Dynasty's sales volume from exports have recorded consecutive growth, with 3% in the second and third quarters of last year, 5% in the fourth quarter, and 7% in the first quarter of 2022.
Mr Maruth said the company planned to spend around 300 million baht to expand branches in Hat Yai, Kanchanaburi and Ratchaburi with a new concept, under which it will add a rest area with electric vehicle charging stations and drive-through food outlets.
The new type of branch will be named Dynasty Park, and the showroom area will increase threefold from 400 sq m to 1,200 sq m.
The first Dynasty Park will be a renovation of an existing branch in Nakhon Pathom, which will formally open in August 2022.
The second will be a new development in Mae Rim on a 52-rai plot, comprising a gas station and a convention hall for meetings and concerts.
Despite a slight decrease in revenue to 2.39 billion baht in the first quarter, from 2.41 billion baht in the first quarter of last year, the company aims to record 5% growth by the end of 2022, from 8.4 billion baht in 2021.
"Amid soaring fuel prices, some customers shifted to lower-priced choices which benefited us because our products have the lowest price in the market," Mr Maruth said.
In the first quarter of 2022, Dynasty's average tile price rose by 5% to 151 baht per sq m, from 144 baht in the fourth quarter last year.
