Tiga Pilar Food to Take Its Rice Unit Public in 2018
Jakarta. Tiga Pilar Sejahtera Food, a listed processed food and rice producer, says its revenue is expected to grow 40 percent this year as it gears up to expand its rice business.
“We aim to see up to Rp 7.3 trillion [$561 million] in revenue this year, with Rp 4.5 trillion from our rice business. That’s roughly 60 percent of our total revenue,” TPS Food finance director Sjambiri Lioe said in Jakarta on Wednesday.
“Seeing the demand in Indonesia, we’re sure that the rice business can grow by at least 45 percent this year,” he added.
TPS Food has booked approximately Rp 5.06 trillion in revenue last year, which was dominated by its rice business, the finance director said.
The company has not yet disclosed its official full-year figures.
Joko Mogoginta, the company’s president director, said TPS Food was allocating as much as Rp 682 billion to expand its rice business this year — nearly 70 percent of its budgeted capital expenditure.
The Jakarta-based company signed a contract for two lines of rice processing machines and one line of rice milling with engineering firm Buhler Indonesia on Wednesday.
The machines will be installed at TPS’s new factories in South Sulawesi.
The new production lines, which will start operations in June next year, are slated to add an additional 330,000 metric tons of rice per year to the company’s current annual production capacity of 480 thousand tons.
The company currently operates three plants under subsidiary TPS Rice, all of which are all located on Java island.
“This is part TPS Food’s plan to expand our food division since we entered this business back in 2010,” Joko said.
He added that the company aimed to produce up to two million tons of rice by 2020, which would book a 5 percent market share in Indonesia.
To reach this goal, the company has earmarked between Rp 6 trillion and Rp 7 trillion to build 11 more rice processing plants in Indonesia, according to Sjambiri.
Joko also said that the company plans to add three new factories next year. However, he declined to disclose further details regarding the plan.
TPS Food is also still mulling plans to spin off its rice business in the next few years, according to its finance director.
“We want [TPS Rice] to go public when we’ve reached $1 billion turnover,” Sjambiri said, forecasting that TPS Rice is likely to reach this level by 2017.
GlobeAsia
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