SCGP has an additional 44.48% share in PT Fajar Surya Wisesa Tbk., in line with strategic direction to expand business growth in ASEAN. This investment aims to support the strong market in Indonesia and be the pivotal foundation for the long-term growth of SCGP’s integrated packaging business. SCGP plans to enhance production efficiency and reduce energy costs at Fajar to align with economic conditions and the increasing demand for packaging, driven by recovering domestic consumption and exports.
Wichan Jitpukdee, Chief Executive Officer of SCG Packaging Public Company Limited or SCGP, said that the Company has an additional 44.48% share in PT Fajar Surya Wisesa Tbk. (Fajar), a leading packaging paper manufacturer in Indonesia with an annual production capacity of 1.8 million tons. Fajar offers a diverse range of products, including corrugated medium, linerboard, duplex board, and coreboard. In 2023, Fajar recorded revenues of approximately IDR 7,723 billion (approximately Baht 17,000 million) and total assets of IDR 12,545 billion (approximately Baht 27,600 million). The total transaction amounts to approximately USD 652.42 million (approximately Baht 23,000 million). Upon completion, SCGP’s shareholding in Fajar will increase from 55.24% to 99.72% of the total issued and paid-up shares, with the remaining 0.28% share held by the public.
“SCGP has been continuously expanding the investment in Indonesia since 2013, recognizing the country as an attractive market with strong fundamentals to become a global economic leader driven by its large population, high domestic consumption rates, young demographic, and continuous increase in foreign direct investment (FDI). Currently, SCGP has six subsidiaries in Indonesia, including the packaging paper production bases; PT Fajar Surya Wisesa Tbk. and PT Dayasa Aria Prima (a subsidiary of Fajar), and the corrugated containers production bases; PT Primacorr Mandiri, PT Indorcorr Packaging Cikarang, PT Indoris Printingdo, and Intan Group. These companies enable SCGP to provide the integrated packaging solutions and foster business synergy. SCGP plans to enhance efficiency and reduce production costs at Fajar by applying machine learning and Artificial Intelligence technologies in the production process, as well as improving of production management, product distribution, and market expansion in collaboration with partners to reach a wider customer. Furthermore, SCGP recognizes a recovery trend in packaging demand driven by domestic consumption and exports, especially in the consumer goods sector. With Indonesia’s inflation rate expected to decline, consumer spending is anticipated to improve, leading to a positive outlook for packaging paper sales in response to rising consumer demand. Indonesia is seen as having significant long-term growth potential. SCGP’s operations, guided by a business plan aligned with economic and market conditions, will enhance profitability,” said Wichan.
Published on: Sep 2, 2024