Optimizing Capabilities to Lead The Market
SMGR Corporate Presentation - March 2024
OPTIMIZING CAPABILITIES TO LEAD THE MARKET
Company Profile & Sector Update | 2 |
SIG Resilient Strategies | 8 |
FY23 Performance Highlights | 19 |
COMPANY
PROFILE & SECTOR UPDATE
Company Profile
Company Milestones
Lines of Business
SIG
#1
Largest cement producer in Indonesia
56.5 MT p.a.
Largest designed cement production capacity in Indonesia
~50.5%
Largest domestic market share
Gold & Green
PROPER rating by Indonesia Ministry of Environment & Forestry
2022
Integrate PT Semen Baturaja through rights issue transaction
2019
Acquired PT Holcim Indonesia to solidify market dominance, renamed as Solusi Bangun Indonesia
2013
Transformation to strategic holding, renamed as Semen
Indonesia 2012
Acquired Thang Long Cement Company from Vietnam for global reach
1995
Consolidated with PT Semen Padang & PT Semen Tonasa, became largest national
Cement | Cement | End-to-end | ||
Manufacturing | Downstream | Businesses | ||
Businesses | ||||
✓ 6+1 Brands, | ✓ Readymix | ✓ Mining | ||
Strong | Concrete | ✓ | Packaging | |
presence in | ||||
✓ | Mortar | ✓ | Waste | |
Indonesia | ||||
✓ Precast | Management | |||
✓ Multipurpose | ✓ Logistic |
Cement | |
✓ IT Services | |
✓ | Special |
Application | ✓ Industrial Estate |
Cement |
Shareholders
51% 18%31%
Government of Indonesia National Public
Foreign Public
cement producer
1991
First SOE to be listed in
Jakarta Stock Exchange 1957
Established as PT Semen
Gresik
Green Label certification | Self-Declaration of | Sustainable production |
from Green Product | EcoLabel from Ministry of | process from Ministry of |
Council Indonesia (GPCI) | Environment & Forestry | Industry |
3
Extensive Distribution Network across Indonesia & the Region
Production &
Vietnam
Distribution Facilities
Integrated
Cement Plants
Quang Ninh Plant - Vietnam
Capacity: 2.3 MT/Year
Lhoknga Plant
Packing Plants | Grinding | |
Plants | ||
Lhokseumawe | Banjarmasin | Ho Chi Minh |
Malahayati | Balikpapan | Kuala Indah |
Belawan | Samarinda | Dumai |
9 | 7 | |
Integrated Plant | Ports | |
Locations | ||
26 | 8 | |
Packing Plant | Grinding | |
Locations | Plants | |
Distribution
Channels
Aceh
385
Distributors
>70,000
Retail
Stores
North Sumatra | |
West Sumatra | West Kalimantan |
Bengkulu | |
South Sumatra | |
Lampung |
Capacity: 1.8 MT/Year
Indarung Plant
Capacity: 8 MT/Year
Narogong Plant
Capacity: 6 MT/Year
Rembang Plant
Capacity: 3 MT/Year
Cilacap Plant
Capacity: 3.4 MT/Year
Tuban Plant
Capacity SI: 13.5 MT/Year
Capacity SBI: 3.6 MT/Year
Pangkep Plant
Capacity: 7.4 MT/Year
Baturaja Plant
Capacity: 3.9 MT/Year
North Sulawesi
East Kalimantan
Dumai | Makassar | Cigading |
Ciwandan | ||
Batam | Mamuju | |
Gresik | ||
Teluk Bayur | Palu | |
Palembang | ||
Bengkulu | Biringkassi | |
Panjang | ||
Palembang | Kendari | |
Lampung | Bitung | |
Ciwandan | Celukan Bawang | Ports |
Tanjung Priok | Maluku Utara | |
Banyuwangi | Ambon | |
Pontianak | Sorong | Thang Long Port |
Lhoknga | ||
Dumai | ||
Teluk Bayur | ||
Tuban | ||
Gresik | ||
Biringkasi |
Papua
Maluku
Central Sulawesi
Southeast Sulawesi
SouthSouthSulawesi
East Java
Central Java West Java
4
CEMENT SECTOR UPDATE
Industry supply & demand will be driven by potential growth of retail and infrastructure projects
Domestic cement capacity vs demand
(MT)
119.1 | 122.1 | |||
100.00 | CAGR | |||
CAGR | +3 up to 4% | |||
+3.5% | 65.5 | |||
-10.3% | +4.3% | +2%E | ||
50.00 | -3.3%+3.5% | |||
Cement Demand Drivers
Bag
Property & Housing developments | Housing Payment Liquidity Facility | |||||||||||||||||
(FLPP) | ||||||||||||||||||
(K unit) | 200 | 220 | ||||||||||||||||
~1% | 12.75 million | 179 | 167 | |||||||||||||||
Estimated annual | units | 109 | ||||||||||||||||
pop. growth from | Backlog national | |||||||||||||||||
58 | 78 | |||||||||||||||||
270 million | housing | |||||||||||||||||
Indonesia pop. in | construction per | |||||||||||||||||
2021 | 2022 | |||||||||||||||||
2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024E | ||||||||||||
Capacity Demand
This anomaly was mainly contributed from soft bag demand due to a shift in household
spending priorities and inflation of goods and services
FY23 | FY23 | ||||
Market Share | Capacity Share | ||||
Semen Indonesia* | 50.5% | 45.5% | Only 4 players | ||
Indocement** | 26.6% | 28.6% | |||
cover ~92% | |||||
Merah Putih | 7.1% | 8.9% | |||
demand | |||||
Conch | 6.9% | 7.3% | |||
Singa Merah | 2.9% | 5.0% | 15 | 12 | |
Jui Shin | 2.4% | 1.5% | |||
players | players | ||||
Semen Jawa (SCG) | 1.9% | 1.5% | |||
2021 | End of 2023 | ||||
Semen Bima (STAR) | 1.9% | 1.5% | • Semen Baturaja | ||
Semen Kupang*** | 0.0% | 0.3% | |||
integrated into SIG | |||||
Semen Serang | N/A | 0.8% | |||
• Bosowa leased their | |||||
Semen Jakarta | N/A | 1.0% | |||
facilities to Indocement | |||||
Hippo | N/A | 0.4% | |||
• Indocement acquired | |||||
Bulk
Infrastructure developments
High Budget Allocation for Infrastructure up to 2024 Based on National Dev. Plan 2020-24
21.5 million ton
Potential Cement Demand for New Capital
Government Infrastructure Budget
(Trillion IDR)
401 410 415 423 417 366 392 422
290 317
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024E
Cement Needs for New Capital (Million Ton)
7.5 | |
5.9 | |
4.0 | |
1.9 | 2.2 |
Semen Grobogan
*including Semen Baturaja
**including Semen Bosowa & Semen Grobogan
***only produce cement, trading by SMGR
2022-242025-292030-342034-392040-45
Source: Demand data up to 2023 from Indonesia Cement Association. Demand forecast from Indonesia Cement Association | |
and SIG calculations (~4% CAGR). New Capital investment from E-Monitoring PUPR, Web-based demand estimation, UU RI | 5 |
No.3 2022. |
CEMENT SECTOR UPDATE
Distribution of supply and demand in Indonesia
Sumatra
Kalimantan | Sulawesi | East Indonesia |
Capacity (mio ton)
SIG (I+GP) | 14.5 |
Merah Putih (GP) | 1.9 |
Total capacity | 16.4 |
Demand | 14.2 |
Capacity Demand
13.4% | ▲ 5.3% |
21.7% YoY |
Java
Capacity (mio ton) | Capacity | |||
SIG (I+GP) | 32.2 | |||
Indocement (I) | 27.3 | |||
Merah Putih (I) | 7.8 | |||
66% | ||||
Singa Merah (I) | 3.0 | |||
Conch (GP) | 2.2 |
Capacity (mio ton) | |
Indocement (I) | 2.6 |
Conch (I) | 3.0 |
Singa Merah (I) | 3.0 |
Merah Putih (GP) | 1.0 |
Total capacity | 9.6 |
Demand | 5.2 |
Capacity | Demand ▲ 21.6% |
YoY | |
7.9% | 7.9% |
Capacity (mio ton)
SIG (I) | 7.4 | ||||
Semen Bosowa (I) | 4.2 | ||||
Conch (I) | 2.0 | ||||
Total capacity | 13.6 | ||||
Demand | 6.2 | ||||
Capacity | Demand | ||||
▼ 3.5% | |||||
YoY | |||||
11.1% | 9.5% | ||||
Capacity (mio ton)
Conch (I) | 1.5 |
Total capacity | 1.5 |
Demand2.3
Capacity Demand
▲ 5.8%
YoY
1.3% 3.5%
Bali Nusra
Capacity (mio ton)
Semen Kupang (I) | 0.4 |
Total capacity | 0.4 |
Demand | 3.9 |
Demand | ||
Semen Bosowa (I) | 2.0 | |
Semen Jawa (I) | 1.8 | |
Jui Shin (I) | 1.8 51.4% | |
Semen Bima (I) | 1.8 | |
Others | 2.7 | |
Total capacity | 80.6 | |
Demand | 33.7 |
▲0.6% | Supply & demand are imbalance, where some of the supply |
YoY | |
capacity are located far from the source of demand, while it is | |
costly to distribute cement from the plant. |
Capacity Demand
0.3% 6%
- 13.1%
YoY
Note: Capacity & demand are percentage of FY 2023 of national total capacity & demand, respectively | 6 |
SIG benefited the increased demand in 2023 more than others, and will keep going to extract further in 2024
Demand FY-23 recorded growth 3.5% YoY supported by bulk growth by 12.8%, while bag recorded flat YoY. SIG domestic volume was able to grow above the market (4.7% YoY).
Bag Volume Growth
2023
9.4%
7.2%
-7.8%
…Kalimantan leads the demand growth for 2023 due to IKN, followed by Bali Nusra for the acceleration program by the government for Tourism Area.
▲ 3.5% | Regional Demand Growth |
12.6%
Industry | 10.7% |
SIG | |
-9.5%
Demand Growth
YTD 2023
1H-23 | 2H-23 | ||
Bulk Volume Growth 2023 | |||
-4.8% | -4.3% | 20.5% | |
19.7% | |||
12.8% |
▲ 5.3% | ▲21.6% | ||
YoY | |||
YoY | ▼ 3.5% | ||
YoY | |||
Sumatera | |||
-1.1 % | Bag | ▲ 0.6% | |
30 % | Bulk | YoY | ▲ 13.1% |
YoY |
- 5.8% YoY
4.0% | ||||
1H-23 | 2H-23 | |||
1H-23 | 2H-23 | |||
Market Share Trends (%) | ||||
Java | |||||||||||||||
Kalimantan | Bali Nusra | Sulawesi | East Indo | ||||||||||||
-1.5 % | Bag | ||||||||||||||
4.5 % | Bag | 11.8 % | Bag | -1.6 % | Bag | 2.2 % | Bag | ||||||||
5.1 % | Bulk | ||||||||||||||
91.6 % | Bulk | -7.7 % | Bulk | ||||||||||||
25.5 % | Bulk | 19.2 % | Bulk | ||||||||||||
Strategy Focus
+0.6% YoY
49.9 50.5
-0.6% YoY
27.2
26.6
+0.0% YoY
22.9 22.9
SIG market share FY23 grow 0.6% YoY while the next best competitor's market share decrease 0.6% YoY. However, the ecobrand segment market share remains flat.
Micromarket Strategy,
- Increase ASP and maintain volume on area with strong positioning,
- Grow volume through multi-brand strategy in more competitive area.
Growth in Bulk Segment,
Maintain high Share of Wallet especially in Government Infrastructure Projects and Private projects and industries.
Improvement in Export Volume,
2022 | 2023 | 2022 | 2023 | 2022 | 2023 | |||
SIG | Next Best Competitor | Ecobrand Players | ||||||
*Source: Demand data 2023 from Indonesia Cement Association, adjusted
Increase in export volume by market penetration on new potential market.
7
SIG RESILIENT STRATEGIES
SIG STRATEGY FOCUS
Strengthen the 4 main strategies to create more sustainable values
Revenue Optimization
Cost Management
Red Ocean
Domestic market
Maximize export market
Operational Excellence
"Optimize
profitability"
Micromarket
strategy
Modernization of retail ecosystem
to gain better visibility on retail level
Bulk market
maintain leadership in strategic national projects
Up to 8.5 mio ton
Port capacity for export
Positive
contribution margin
"Optimize production index & cost efficiency"
"Cargo
consolidator"
Up to 11% | Coal | SEEC | STEC |
Specific | Specific | ||
(2019-2030) | index | Electrical | Thermal |
Clinker factor | Energy | Energy | |
reduction | |||
reduction | Consumption | Consumption | |
Reduction | Reduction | ||
~3,000 routes | ~9,800 trucks |
~88% land and 12% sea | ~11% owned |
routes | |
Blue Ocean
"Expand the products & businesses"
Existing product & solution
Ready mix solution
Non-OPC bulk cement
Masonry
Mortar
Further invest in BM solution, including distribution & logistics
SIG wide operations
385 Distributors >70,000 Retail stores
Decarbonization | AFR | RDF | Solar Panel |
"Reduce | ▲ 20% | Tonasa | ▲ 572 MWp* |
emission" | Thermal | &Tuban | Solar Panel Rollout |
Substitution Rate | RDF plant facilities | 2021-2030 Target | |
2030 Target | |||
SMBR Integration | Integrated functions & group | ||
"Value | policies: | ||
✓ Sales & marketing | |||
creation" | ✓ Supply chain | ||
✓ Procurement | |||
✓ Finance
✓ Production
✓ Human Capital ✓ ICT
9
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Disclaimer
PT Semen Indonesia Persero Tbk published this content on 15 March 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 15 March 2024 09:07:03 UTC.