State owned cement producer company PT Semen Indonesia Tbk [SMGR] was one of the most outstanding emitents among companies with biggest capitalization at BEI.
To combine several companies into one, with one of them acting as holding company was not an easy task. But PT Semen Indonesia [persero] Tbk which was holding company of Semen Padang, Semen Gresik, Semen Tonasa, and Thang Long Cement Vietnam, proved that nothing was impossible.
Al in all, the company with code SMGR had become the first BUMN to go international by acquiring Thang Long Cement Vietnam had succeeded in overcoming problems with prudence and strong leadership. Thang Long Cement Company or TLCC, a company now commanded by SMGR was now taking stance to expand into the second biggest cement producer in Vietnam in the next few years.
Certainly this way of expansion was a phenomenon that builds optimism that an Indonesian BUMN company could score operational excellence in other countries. Business competition in the cement market in Asia was tight in line with infra structure building and property activities, the biggest competitors being from Vietnam, China, and Thailand.
For that matter the company planned to increase export target 2014 to become 500.000 to 1 million tons. Such was necessary because export realization of last year was still small and was estimatedly only at Rp200.000 to 300.000 tons.
Export target could only be increased if domestic supply was fulfilled. The company rated that export of cement was still rated as positive; but in 2013 the company only managed to export around 200.000 to 300.000 tons only and yet demand from Bangla Desh, Sri Lanka and South Asian states was still sizable.
On the other hand, SMGR export performance had been supported by their subsidiary companies like PT Semen Padang and Thang Long Cement Company [TLCC] Vietnam. The company stated that export market could be expanded further, moreover with the strategic geographical position of some Indonesian cement factories.
The company also set sales target for 2014 at 31 million tons of cement in line with growth of national cement market which was projected to grow by 6% against previous year. As with income, the company sets target of Rp25.9 trillion till end of 2014. The figure increased by 20% compared to income of 2013 which was predicted to reach Rp21.06 trillion.
SMGR Finance Director Ahyanizzman was optimistic that income of PT Cement Indonesia would grow above 20% compared to income over the past year. In line with increased income, predictably net profit would increase.
Ahyanizzman disclosed that SMGR projected growth of 10% in net profit of 2014. Meanwhile target of net profit of SMGR by end of 2013 was Rp6.35 trillion, hence company’s net profit by end of this year was projected to reach Rp7.62 trillion.
“Net profit by end of this year was targeted to grow by above 10%. Assuming that growth of national cement industry was 6%, Probably we can grow by 15%.” He said on the occasion of the 1st birthday of PT Cement Indonesia at Ritz Carlton Hotel Kuningan Jakarta on Thursday night [9/1].
All through 2013 last, the company commanded over domestic market with 43.8% market share. As targeted by 2014 soon, market share at the domestic market came to 44% or more, with estimated growth of cement 6% nationwide, the Management of SI set target for cement sales at 31 million tons. “In 2014 we set double digit target growth in sales or profit” he said.
To build a domestic market, a sound strategy was needed. The company would focus effort on safeguarding market share in the range of 44%. So far, the company operated 21 packing plants and 22 cement mills in all over Indonesia.
Besides, there were 11 cement harbors owned by SI in Padang, Tuban, Gresik, Biringkasi, Dumai, Ciwandan, Banywangi, Sorong, and two harbors in Vietnam. As planned, in second week of January 2014 the company was operating new packing plant in Banjarmasin, South Kalimantan.(SS)
Business News - January 15, 2014