{"id":165864,"date":"2025-10-29T09:04:36","date_gmt":"2025-10-29T02:04:36","guid":{"rendered":"http:\/\/www.thestorythailand.com\/?p=165864"},"modified":"2025-12-12T00:29:24","modified_gmt":"2025-12-11T17:29:24","slug":"scgp-3-pronged-strategy","status":"publish","type":"post","link":"https:\/\/www.thestorythailand.com\/en\/scgp-3-pronged-strategy\/","title":{"rendered":"SCGP’s 3-Pronged strategy: Indonesian M&A, China Pivot, Healthcare venture"},"content":{"rendered":"\n

Packaging giant to acquire MYPAK for 956M THB to bolster its Indonesian ‘Fajar’ operations; implements ‘Loose Coupling’ strategy to de-risk from China and target India as a new growth hub.<\/p>\n\n\n\n

Despite navigating a challenging first nine months of 2025, marked by global economic volatility, lower selling prices, and a strong Thai baht, SCG Packaging (SCGP) is executing a significant strategic offensive.<\/p>\n\n\n\n

While 9M 2025 consolidated revenue was 94.2 billion THB (a 7% decrease YoY) and profit hit 2.87 billion THB (a 20% decrease YoY), the company\u2019s Q3 2025 results signal a sharp recovery. Q3 profit attributable to the parent company soared by 65% year-on-year to 953 million THB, driven largely by improved performance in its Indonesian paper packaging business.<\/p>\n\n\n\n

Now, SCGP is aggressively pursuing a three-pronged strategy to build resilience and new growth engines: a key vertical integration M&A in Indonesia, a strategic trade diversification away from China, and a decisive entry into the high-value healthcare market.<\/p>\n\n\n\n

Strategy 1: ‘Loose Coupling’ from China, Targeting India<\/strong><\/p>\n\n\n\n

One of SCGP\u2019s most critical adjustments is the strategic management of its export portfolio. Wichan Jitpukdee<\/strong>, Chief Executive Officer of SCG Packaging Public Company Limited or SCGP, detailed the company’s “Loose Coupling from China” strategy, which began in late 2024.<\/p>\n\n\n\n

This proactive move was based on a forward-looking risk assessment. “We foresaw that China would be impacted by tariffs from the United States, which was a clear risk signal in international trade,” Wichan explained. “This factor required SCGP to diversify its customer base and markets to mitigate potential impacts.\u201d<\/p>\n\n\n\n

The results are stark: SCGP’s export share to China in the first nine months of 2025 was slashed from 8% of total exports to just 4%.<\/p>\n\n\n\n

Crucially, this volume was not lost. The company\u2019s sales teams successfully diverted these orders to high-potential new markets, chiefly India, along with Australia.<\/p>\n\n\n\n

Wichan emphasized this is not a short-term “dumping” exercise. “SCGP views India as a strategic base for future investment,” he stated, framing the move as a long-term plan to learn the market and establish a strong foundation for future growth.<\/p>\n\n\n\n

Strategy 2: 956M THB Deal to Cement Indonesian Supply Chain<\/strong><\/p>\n\n\n\n

Simultaneously, SCGP is deepening its investment in Indonesia, a market it views as a “rising star” with growth potential equivalent to Vietnam.<\/p>\n\n\n\n

On October 28, 2025, the company’s board approved the 100% acquisition of PT Prokemas Adhikari Kreasi (MYPAK), a corrugated container producer. The deal, valued at up to 455 billion IDR (approx. 956 million THB), is expected to close in Q4 2025.<\/p>\n\n\n\n

This acquisition is a key jigsaw piece for SCGP’s vertical integration strategy. Danaiate Ketsuwan, SCGP\u2019s CFO, explained that while the company has a powerful “upstream” asset in Indonesia with PT Fajar Surya Wisesa Tbk. (Fajar), a major packaging paper producer, it lacked sufficient “downstream” converting assets (factories that make the final boxes).<\/p>\n\n\n\n

The MYPAK acquisition, located near Fajar\u2019s plant in Bekasi, West Java, directly fills this gap. It will immediately increase SCGP’s integration level (the percentage of its own paper it converts) in Indonesia from 18% to 26%. The long-term goal is to reach 50%, matching its operations in Thailand and Vietnam.<\/p>\n\n\n\n

The deal is expected to add approximately 1.8 billion THB in annual revenue and brings a strong portfolio of multinational FMCG clients, creating cross-selling opportunities and enhancing cost efficiency.<\/p>\n\n\n\n

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Strategy 3: Beyond the Box\u2014Entering the Medical Device Market<\/strong><\/p>\n\n\n\n

Reflecting a significant business model evolution, SCGP is making a serious push into “New Business,” spearheaded by its Healthcare Supply division. This unit alone is projected to generate 2.7 to 2.8 billion THB in sales this year.<\/p>\n\n\n\n

The company\u2019s latest move is a new investment in machinery to produce syringes and needles in Thailand. The facility is currently in its installation phase and is expected to begin commercial operations between January and February 2026.<\/p>\n\n\n\n

The primary goal is clear: import substitution. SCGP aims to tap into the substantial domestic market for these medical devices, which are currently supplied primarily by imports. This move represents a significant “elevation” of the business, moving from a packaging specialist to a player in the complex, high-value medical solutions industry.<\/p>\n\n\n\n

Brighter Q4 Outlook as Material Costs Shift<\/h3>\n\n\n\n

SCGP management expressed confidence in a strong Q4 2025, citing two key raw material trends:<\/p>\n\n\n\n