Commodity: Export Issues
The Ministry of Trade reintroduces a US$3 per ton export tax for crude palm oil (CPO) shipments in January 2017 as the reference palm oil price exceeded the US$750 per ton threshold that separates the existence of export duties from zero rates. The Government’s reference price was set at U$$788.26 per ton for January 2017.
Kao Corp + Sukanto Tanoto
Kao Corporation, one of the largest Japanese consumer goods players in Indonesia, and Apical Group Limited have agreed to join forces for the development of fatty acid plant in Indonesia. The joint venture is scheduled to start commercial production of palm oil derivatives in 2019.
Infrastructure Journal
President Joko ‘Jokowi’ Widodo has inaugurated commercial operation of Lahendong geothermal (2×20 MW) and Ulubelu geothermal (55 MW) yesterday. Construction of these power plants were started in third quarter 2015 with total investment of US$532.07 million. State-owned oil and gas company Pertamina claims completion of these projects are faster by one to six months.
Indofarma US$1 Billion, How Real?
Indofarma (INAF), the state-owned pharmaceutical company, is among the best performing stocks this year with 2537% gain. At the last quoted price, Indofarma’s market capitalization was Rp13.73 trillion, slightly above US$1 billion, around 24 x equity as of September 30, 2016. It is only inches below fellow state pharmaceutical company Kimia Farma (KAEF), which reported substantially stronger fundamentals. How real?
Dima Group: Beyond Alcohol
Growing cafe, club culture and tourism industry contributed to higher demand for beer and alcoholic beverages in Indonesia. It is a highly regulated industry, but like tobacco, such environment could mean big profit margins even when excise rates increase every year. One of the largest players in the industry is Dima Group.
Ayala+Barito+EGCO+Mitsubishi
Media reported this week that a consortium of Ayala Corp (the Philippines) and Star Energy Group has been selected winner of the tender to acquire Chevron’s geothermal assets in Indonesia and the Philippines. This is an interesting partnership to watch in regional context of partnership between business players and quest for control of Indonesia’s energy market.
Key Takeaways November Data of United Tractors
United Tractors (UNTR) continued to report strong performance in November. Sales volume of Komatsu construction machinery reached 196 units, jumped 48% year-on-year, thanks to stronger demand from infrastructure and mining industries.
Infrastructure Journal
Development of infrastructure will continue to dominate economic activities in Indonesia next year. Some of them are related to the development of tourism industry in eastern part of Indonesia and North Sumatra province. There are also supporting infrastructure projects for Asian Games 2018 in Jakarta and Palembang, South Sumatra.
Keppel + Metropolitan Land
Keppel Land Limited, subsidiary of Keppel Corporation Ltd, has through PT Sukses Manis Indonesia (SMI) entered into an agreement to jointly develop landed homes on a 12 hectares site in Tangerang, Banten province, with PT Metropolitan Permata Development (MPD), a subsidiary of PT Metropolitan Land Tbk (MTLA).
Outside Java Toll Road Projects So Far
The government missed targets to operate some new toll roads, including those in the trans-Sumatra program, this year due to difficulties in land acquisition and financing in early part of 2016. Entering the third year of Jokowi-Kalla administration, however, the chance is big to see commercial operation of some sections of toll roads developed outside Java.