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Bloomberg
Thai property developer Sansiri Pcl is placing sales ahead of profitability as it looks to generate cashflow to survive the coronavirus
pandemic.
The Bangkok-based group, which builds high-end condominiums in cities around the Southeast Asian nation, is offering aggressive discounts and other promotional campaigns in an attempt to lure buyers. It expects to revise its annual sales target after a strong start to the second quarter, President Srettha Thavisin said.
“During times of crisis, profitability comes second,†Srettha said in an interview. “Cash is king and brand strength is big. The coronavirus crisis is bigger than 9/11 and the Asian financial crisis combined, bigger than anything we’ve ever encountered,†he said, referring to the September 2001 terrorist attacks against the US.
Sansiri last month increased its second quarter sales target to 12 billion baht ($371 million) after generating 4.2 billion baht from home sales in the first three weeks of April.
That puts the company on track for record first-half revenue, Srettha said.
Analysts don’t appear as confident. The company’s stock has nine sell ratings, five holds and one buy, according to data compiled by Bloomberg.
Its shares are down 36% since January versus an 18% decline in the country’s benchmark stock index.
“While we see its earnings outlook turning ugly over the next few years, we fully endorse management’s view that cash flow, not profitability, should be the company’s key focus in the near term,†Kasikorn Securities Pcl said in a report that downgraded the stock on April 24.