PT SEMEN INDONESIA (PERSERO) TBK Corporate Presentation
May 2022
CEMENT SECTOR UPDATE
Cement utilization has recovered post-pandemic,
demand will be driven by property and infrastructure growth
Domestic cement capacity vs demand | FY20 Market | FY21 Market | FY21 Capacity | ||||||||||||||
(MT) | Share | Share | Share | ||||||||||||||
150.0 | Semen Indonesia | 51,1% | 49,3% | 42,2% | |||||||||||||
Indocement | 25,9% | 25,4% | 20,9% | ||||||||||||||
127.1 | |||||||||||||||||
119.1 | Conch | 6,1% | 7,3% | 7,3% | |||||||||||||
18.1 MT | |||||||||||||||||
Merah Putih | 4,4% | 6,2% | 8,9% | ||||||||||||||
100.0 | 2031F Gap | Semen Bosowa | 3,4% | 3,0% | 5,2% | ||||||||||||
53.8 MT | |||||||||||||||||
109 | |||||||||||||||||
Semen Baturaja | 3,1% | 3,0% | 3,2% | ||||||||||||||
2021 Gap | |||||||||||||||||
Jui Shin | 2,0% | 2,0% | 1,5% | ||||||||||||||
50.0 | 65.2 | Semen Jawa (SCG) | 1,9% | 1,8% | 1,5% | ||||||||||||
▲ 4.3% | ~5% | Semen Bima (STAR) | 1,6% | 1,8% | 1,5% | ||||||||||||
Semen Kupang | 0,4% | 0,3% | 0,3% | ||||||||||||||
Actual FY21 | Estimated FY22-26 | ||||||||||||||||
- | Industry demand growth | Industry demand growth | Semen Grobogan | N/A | N/A | 2,5% | |||||||||||
Singa Merah | N/A | N/A | 2,5% | ||||||||||||||
2017 | 2018 | 2019 | 2020 | 2021 | 2022F 2023F 2024F 2025F 2026F 2027F 2028F 2029F 2030F 2031F | ||||||||||||
Semen Serang | N/A | N/A | 1,0% | ||||||||||||||
Capacity | Demand | ||||||||||||||||
Semen Jakarta | N/A | N/A | 0,8% | ||||||||||||||
Hippo | N/A | N/A | 0,4% |
Cement Demand Drivers
14
Competitors in National cement market
Economic players
15-35% cheaper pricing
Bag | ~1% |
Property & | Estimated annual pop. |
Housing | growth from 270 |
developments | million Indonesia pop. |
in 2021 |
12.75 million units Backlog national housing construction per 2022
Housing Payment Liquidity Facility (FLPP)
(K unit)
179 200
109
58 78
2018 | 2019 | 2020 | 2021 | 2022 |
Bulk
Infrastructure developments
High Budget Allocation for Infrastructure up to 2024 Based on National Dev. Plan 2020-24
Indonesia Government
Infrastructure Budget
(Trillion IDR)
401 410 415 423 417 385
290 317
21 million ton
Potential Cement Demand for New Capital
Cement Needs for New Capital
(Million Ton)
7.5
5.9
4.0
1.62.2
2015 2016 2017 2018 2019 2020 2021 2022
2022-242025-292030-342034-392040-45
Source: Demand data up to 2021 from Indonesia Cement Association. Demand forecast from Indonesia Cement Association and SIG calculations (~5% CAGR). New Capital investment from E-Monitoring PUPR, Jan-2022,Web-based demand estimation, UU RI No.3 2022. | 1 |
DOMESTIC DEMAND OVERVIEW
Portion, trend and cyclicity
20% | 21% | 22% | 23% | 24% | 25% | 27% | 27% | 23% | 23% | 25% |
80% | 79% | 78% | 77% | 76% | 75% | 73% | 73% | 77% | 77% | 75% |
2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | YTD May 2022 |
Bag Portion | Bulk Portion | |||||||||
Bag and Bulk
National Demand
Portion
Cement consumption in Indonesia is still dominated by retail, most of which come from people who renovate or build their own houses, or small developers who build small- scale housing.
52% | 56% | 57% | 58% |
48% | 44% | 43% | |
42% | |||
29% | 38% | ||
31% | |||
10% | |||
2016 | 2017 | 2018 | 2019 |
1H Portion | 2H Portion |
57% | 56% | National Demand |
43% | 44% | Trend 1st & 2nd |
Semester | ||
31% | 25%Based on trends, national cement | |
demand tends to be higher in the | ||
second semester than in the first | ||
semester, given the high rainfall in | ||
2020 | 2021 | the first semester and the |
government infrastructure projects | ||
2H/1H | realized more in 2H. |
14.4% | |||||||||||
5.5% | 3.5% | 4.8% | 4.3% | ||||||||
3.5% | 7.7% | 0.6% | -0.3% | ||||||||
-0.6% | |||||||||||
-10.7% | |||||||||||
2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | YTD May 2022 |
Growth Bag | Growth Bulk | National Growth |
CAGR Bag: | CAGR Bulk: | CAGR National: |
11.4% | 3.8% | 15.2% |
Bag & Bulk Demand Growth
Higher bulk demand growth is in | tons |
line with the development of | |
cement derivative products and | Million |
increase in government | |
infrastructure programs during | |
2015-2019. In 2020 bulk | |
consumption decrease | |
significantly following the | |
government budget reallocation | |
for handling the Pandemic | |
COVID-19 |
8.0 | Monthly National | |||||||||||||||||||||||||||||||||||||||||||
7.0 | Demand Trend | |||||||||||||||||||||||||||||||||||||||||||
6.0 | ||||||||||||||||||||||||||||||||||||||||||||
In addition, the month of | ||||||||||||||||||||||||||||||||||||||||||||
5.0 | ||||||||||||||||||||||||||||||||||||||||||||
Ramadan and Eid al-Fitr fall in | ||||||||||||||||||||||||||||||||||||||||||||
4.0 | the first semester during which | |||||||||||||||||||||||||||||||||||||||||||
3.0 | construction activity generally | |||||||||||||||||||||||||||||||||||||||||||
2.0 | slows down. | |||||||||||||||||||||||||||||||||||||||||||
1.0 | ||||||||||||||||||||||||||||||||||||||||||||
- | Jan Feb Mar | Apr May Jun | Jul | Aug Sep Oct Nov Dec | ||||||||||||||||||||||||||||||||||||||||
2018 | 2019 | 2020 | 2021 | 2022 | ||||||||||||||||||||||||||||||||||||||||
Source: Indonesia Cement Association Data | 2 |
*Growth without Singa Merah, because Singa Merah join ASI in 2022 |
INDUSTRY CHALLENGES
Increasing competition due to oversupply and lower demand post pandemic, as well as the increasing coal price has given more pressure to the industry
Cement Industry Capacity and Demand Growth
140.0 | 100% |
79% | 84% | 84% | 76% | 115.1 | 119.1 | ||||||
109.4 | 109.4 | 111.1 | |||||||||
120.0 | 68% | ||||||||||
80% | |||||||||||
92.8 | 62% | 65% | 65% | 57% | 59% | ||||||
100.0 | 83.8 | ||||||||||
60% | |||||||||||
80.0 | 66.6 | 69.8 | 71.9 | 69.5 | 70.0 | ||||||
57.9 | 59.9 | 62.0 | 61.6 | 66.3 | 62.5 | 65.2 | 40% | ||||
52.2 | |||||||||||
60.0 | |||||||||||
16.6% | 10.7% | 17.9% | |||||||||
40.0 | 0.0% | 20% | |||||||||
4.9% | 2.9% | 0.0% | 1.6% | 3.6% | 3.5% | ||||||
14.3% | 11.0% | ||||||||||
3.4% | 3.5% | 7.6% | 4.8% | 4.3% | 0% | ||||||
20.0 | |||||||||||
-0.6% | 0.7% | ||||||||||
- | -10.7% | -20% |
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Capacity | Demand |
Domestic Utilization | Capacity Growth |
Industry Utilization Rate
National cement production capacity increase more compared to the demand growth creating oversupply situation in the Indonesia cement industry.
Industrial utilization rate has decreased from 84% in 2013 to 59% in 2021 as cement players have doubled since 2015. 2021 utilization was still low as national demand has not yet back to pre pandemic level.
Capacity Share
10% | 10% | 13% | 21% | 29% | 31% | 31% | 32% | ||||||
31% | 29% | 29% | 35% | 37% | |||||||||
24% | |||||||||||||
22% | 23% | 23% | |||||||||||
22% | 22% | 21% | |||||||||||
60% | 60% | 59% | 55% | 49% | 46% | 46% | 45% | 44% | 42% | ||||
2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | ||||
SIG + SBI | INTP | Others | |||||||||||
Cement Industry Hyper
Competition
Since 2019 volume share eco-brands growth in almost all area, with wider price disparity. This situation creates domestic cement industry in hyper competition condition which leads to a challenging situation for our performance in 2021 (volume and price drag down)
ICI 4 (USD/ton)
160
140
120
100
80
60
40
20
0
Rising Trends of Coal Price
Supply-Demand imbalance during recovery from COVID-19 pandemic derived in significant coal price increase which impacted the production cost, especially in the 4th quarter 2021. although the price trend in early 2022 has beginning to decline, the prediction for full year 2022 is still above the 2021 figure.
Source: | |
Indonesia Cement Association Data; Bloomberg | 3 |
INDUSTRY UPDATE
National demand grew better in May
Industry | SIG | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Domestic Sales Volume | Java and Outer Java | Domestic Sales Volume | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(thousand tons) | Domestic Sales Volume | (thousand tons) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(thousand tons) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
-5.2% | -1.8% | 1.3% | -3.2% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
12,454 | 12,235 | 7.8% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
18,417 | 17,458 | 17.5% | 10,994 | 11,136 | 9,029 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
8,740 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
5,032 | 5,914 | 2,740 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2,542 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Bag | Bulk | Java | Outer Java | Bag | Bulk | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
YTD May 21 | YTD May 22 | YTD May 21 | YTD May 22 | YTD May 21 | YTD May 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
▼ 0.3% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Java growth contribute more to | ▼ 0.8% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contraction in national demand | Contraction in SIG demand growth, | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
growth, mainly from bag demand | industry demand contraction | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
due to ASP adjustment in April | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Demand Proportion | Domestic Sales Volume | Domestic Volume Proportion | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
120% | (thousand tons) | 120% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
100% | -1.2% | 100% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
80% | 79% | 80% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60% | 75% | 2,983 | 2,947 | 29.9% | 60% | 78% | 76% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
40% | 21% | 912 | 40% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
702 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
20% | 25% | 20% | 22% | 24% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
0% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
0% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Bag | Bulk | Bag | Bulk | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Bag | Bulk | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
YTD May 21 | YTD May 22 | May 2021 | May 2022 | YTD May 21 | YTD May 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
▲ 4.7% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Decrease in bag cement | The increase in May demand growth | Increase in bulk cement | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
proportion, aligned with the | was due to working days back to | proportion, aligned with the | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
decrease in bag demand | normal | increase in bulk volume |
Source: Demand data up to May 2022 from Indonesia Cement Association (excluding Singa Merah). Singa Merah sakes volume May 2022: 101,3 thousand tons, up to May 2022: 550,9 thousand tons | 4 |
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PT Semen Indonesia Persero Tbk published this content on 29 July 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 July 2022 09:54:09 UTC.
