Bangchak Group Pursuit of Innovations and New Business Expansions

The Company prioritizes the business portfolio balancing. Bangchak main EBITDA was from only the oil business, a business with high volatility from oil prices, therefore Bangchak group aims to create new businesses to diversify risk and not to rely only on a sole business. Bangchak has targeted for new green business (green energy and bio-based products) to contribute 50% of the total EBITDA in the next 5 years. Innovation has been playing an important role for the changes, new product and business creations, as well as emphasizing Bangchak’s role as a leader in green business with social and environmental responsibilities. In order to reach the target, Bangchak established “Bangchak Initiative and Innovation Center (BiiC)” 3 years ago with 3 main corporate positions including;

1. Research and Development (R&D): it is an internal innovation to explore, develop and expand the bangchak’s products to serve potential customers’ needs as well as to research for innovations to catch up with the rapid changes in the global business trend. Its current focus is on bio-based business.
2. Corporate Venture Capital (CVC): it is an external innovation to scout startup businesses that would disrupt the current portfolio or would be a new business in the next 3-5 years. With this, some employees went to well-known places such as Silicon Valley, USA, Europe, Israel and China to study, and explore the global startup innovations and technologies that could be beneficial to BCP group, especially in green energy and bio-based products.
3. Ecosystem & Incubation: it is a hybrid innovation that explores collaboration with startups including universities, research institutes and other public sectors in Thailand by inviting them for project proposals that could solve problems or increase the company’s competitiveness. Then, an internal startup or “The Intrapreneur” project is provided for new employees who have the idea about new different businesses from Bangchak’s current portfolio, and be able to further study and execute as a new business.

Another issue is that the Company realizes the importance of the digital system that has also been playing a very important role in business; therefore, the “Corporate Digital Transformation” unit was established under BiiC this year as well. This is to find pain points or needs of internal departments and use digital technology to help solve those pains such as reducing working processes, increasing the potential of employees, or developing business innovation with digital technology that can generate additional income or reduce expenses for the group.

For new start-up businesses, BiiC is searching for the ones that create synergies for the BCP group. We are now focusing on 2 aspects of green business startups:

1. Green energy for BCPG, emphasizing on high technology in digital energy, battery, energy efficiency, etc. and
2. Bio-based products for BBGI such as food ingredients, alternative protein and cosmetics, which are high-value products made from Thai agricultural products. We are interested in either Thai or foreign startups with high or deep technology.