INDOFOOD CBP Tbk

Company analysis

Manufacture of food and beverage industry is interesting sector due to its steady growth over the last five years. In 2010 until 2014 the CAGR of the sector was 8.7 % (at constant price). The demand of the product may possibly at above the supply. Among of other sectors, manufacture of food product and beverages had the highest growth at that period. (source: BPS )

In 2014 the company attained double digit growth of revenue that stood at 19 % higher than sales in 2013. The impressing segment in 2014 was beverage segment that was growing more than 700 % compared to same segment in 2013. The decline was incurred in food seasoning segment in 2014 compared to the same segment in 2013. It decreased more than 26 %. The competition with another major player in food seasoning market such as unilever indonesia may be as the reason of the downfall. The increase of beverage segment was incurred due to acquisition of premium brand such as Asahi Brand and Pepsi Brand. The biggest part of revenue was contributed by noodle segment that was 55 % of total revenue.

As the result of that the company succeeded in increase its gross profit margin and reduced its cash cycle shorter.

Instan noodle was still dominated the company’s revenue in 2014. The demand of this product is high in indonesia. The company competes with wings corp in this noodle’s market at domestic. Besides it is selling to product for domestic, the company also exports the product to abroad. In 2014 Saudi Arabia was the biggest contributor in export segment.  

The company has collaborated with global company in producing food seasoning product, it developed joint venture with Nestle Indonesia to build Nestle indonesia Cita Rasa Indonesia. For beverage product the company collaborated with Asahi Corporation from Japan to establish Asahi Indofood Beverage Makmur.

The majority of revenue and receivable were with related parties, the company uses its subsidiary, Indomarco Adi Pratama, as main its main distributor. It was more than 71 % of sales was with related party.

Smart E-money Inc

Indofood as the part of salim group has affiliated company in Philippine which has launched mobile wallet. It collaborated with Citibank Philipine and Visa International to established Charge to phone (C2P). This product is a combination between card services includes visa credit card and provider as mobile wallet for transaction. (http://www.philstar.com/banking/2014/12/16/1403055/smart-citi-visa-team-mobile-digital-payments).

In the future it is possible that the company will use the product for transaction in its business segment such as indomarco adi pratama.