SCG Cement-Building Materials, a subsidiary of conglomerate Siam Cement Group (SCG), forecasts the overall domestic market for cement and building materials to grow by 1-3% this year after reaching 450 billion baht in 2016.
Revenue at SCG Cement-Building Materials is expected to grow at the same rate this year, up from 170 billion baht in 2016, said Nithi Patarachoke, vice-president for the domestic market.
Some 110 billion was revenue the company generated from the domestic market and the rest was from exports, largely to neighbouring countries.
Mr Nithi said the government's spending on infrastructure megaprojects is expected to drive demand for cement and building materials this year.
He expects demand for cement and building material from the government projects to grow by 10% this year as the state is heavily promoting its infrastructure projects, especially those expanding motorways and rail systems as well as massive investment to build new industrial estates and residential areas along with the Eastern Economic Corridor (EEC).
The EEC spans the provinces of Chon Buri, Rayong and Chachoengsao and will be designated as a high-tech industry cluster with an eye towards becoming Asean's leading economic zone for industry, infrastructure and urban development.
The EEC is designed to accommodate the government's 10 targeted industries of next-generation cars; smart electronics; affluent, medical and wellness tourism; agriculture and biotechnology; food; robotics for industry; logistics and aviation; biofuels and biochemicals; digital; and medical services.
Apart from demand for cement and building materials from the government projects, Mr Nithi expects flat growth in demand from residential and commercial projects.
He said government investment and rising crop prices will raise consumer purchasing power.
"The prices of major commodities such as rice, natural rubber, sugar cane and palm fruit are higher than last year, which should mean rising purchasing power," Mr Nithi said.
However, uncertainties in global and domestic economies could prevent people from spending on home renovation or prevent private firms from starting construction of new projects, he said.
Mr Nithi said SCG Cement-Building Materials has set aside 200 million baht to be used in marketing activities this year, mostly for e-commerce channels.
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