Global Green Chemicals Plc (GGC), the SET-listed biochemical arm of PTT Global Chemical Plc (PTTGC), has announced a significant reduction in raw material inventory, hinting at the possibility that a corporate unit could be in collusion with third parties or suppliers.
"The company has recently found certain facts indicating that as of May 31, 2018, the quantity of raw materials of 71,848 tonnes in the information system, for which full payment has been made, is significantly different from the actual quantity of raw materials at the storage facilities of the suppliers," GGC said in a release.
"The inspection and findings of this issue is a consequence of the fact that due to the high level of inventory, the board of directors has a policy [to control] the level of inventory and ensure an appropriate level in order to mitigate the impact from raw material price volatility."
The marketing, commercial and supply unit is not in compliance with standard operating procedure, and staff may be colluding with third parties or suppliers.
"There is also grounds for suspicion that no raw material inventory is stored at the storage facilities of the suppliers," GGC said.
The potential damage is estimated at 2.1 billion baht.
The company insisted that the issue would not have an impact on GGC's business operations and investment plan, as financial liquidity remains adequate.
PTTGC is GGC's major shareholder with a 72.3% stake.
GGC shares yesterday closed yesterday on the Stock Exchange of Thailand at 9.25 baht, down 2.95 baht, in trade worth 526.7 million baht.
