Index Living Mall targets low-income success defies mortgage setbacks

Index Living Mall (ILM), a Stock Exchange of Thailand (SET)-listed company, has observed rapid growth in the low-income segment, despite soaring mortgage rejection rates. This trend led to a strategic shift in the company’s approach, expanding its product range to include non-branded furniture and budget-friendly products imported from China.

Kridchanok Patamasatayasonthi, ILM Managing Director, highlighted the exceptional 100% growth within the low-income segment, served by the company’s Furinbox brand. She anticipates revenue to spike from approximately 300 million baht to a billion baht within two years.

Currently, Furinbox contributes less than 5% to the revenue, but the projection is a rise to at least 10% within three years. This segment, being the largest in the country, could potentially outpace others in the future, said Patamasatayasonthi.

The company plans to increase the number of Furinbox branches from 22 to 26. These outlets target customers seeking furniture priced 15-20% lower than the Index furniture brand’s offerings. Despite the influx of Chinese goods through online channels, Kridchanok believes this competition is inevitable but does not view it as a threat. Instead, she sees an opportunity to tap into provincial markets primarily dominated by non-branded furniture.

Last year, the furniture market in Thailand was valued between 80-90 billion baht. Despite this, ILM retained the largest market share, with a revenue of 9.4 billion baht, marking a 4.5% increase from 2022. The company also reported a profit of 726 million baht, a 10.2% rise. Both figures represent the highest recorded by the company to date.

ILM remains financially robust, with a debt-to-equity ratio of 1.1 times. It plans to increase its typical annual investment from 500 million baht to around 1 billion baht for the next three years, reported Bangkok Post.

ILM Senior Vice President for Business Development Ekalak Patamasatayasonthi commented on the national interest rate policy, which has recently caused controversy. He suggests the rate needs to be suitably balanced – neither too high nor too low. He noted that last year’s rate hikes impacted the company, affecting purchasing power as half of ILM’s customers are new homeowners.

Ekalak also mentioned the company’s workforce of approximately 7,000 employees and highlighted that rising labour wages are a concern for the upcoming year. To mitigate this, the company plans to streamline other costs to maintain steady revenue.

For this year, ILM aims to achieve more than 10% in revenue growth, with an investment of 550 million baht for a new Little Walk branch in Rattanathibet, and a 170-million-baht energy-saving branch in Saraburi, slated for the first quarter of 2025.

To capture the high-end market segment, the company will launch DecorScape in Thong Lor this year, envisaged as the hub for premium products.