Globe Asia

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august , 2018
Budi Hartono Djarum $935 million
, , GDP Ventures,
Kumparan, Gojek
Mochtar Riady Lippo Group $930 million OVO, MatahariMall, Mbiz,
Venturra Capital (Ruang Guru, Grab, Sociolla, Zilingo)
Eddy Sariaatmadja Emtek $795 million Blackberry Messenger (BBM), Bukalapak, Dana, Doku, KLN
Patrick Walujo Northstar Capital $750 million Gojek, Pasarpolis, NSI Capital
Jacob Oetama Kompas Gramedia $450 million Skystar Ventures,
Chairul Tandjung CT Corp $275 million
Anthoni Salim Salim Group $175 million ,
Franky Widjaja Sinarmas $140 million SMDV, Dimo
Value of Tycoons’ Investments in Digital Technology
The business landscape is now transforming to digital economy. Top Indonesian business leaders have
invested heavily in their respective tech startups, venture capital and e-commerce companies.
Taking a sectoral look at IoT, health care is one
area where this technology has seen the widest early
adoption to help hospitals diagnose patients in real
time and monitor their recovery. Indonesia’s national
health care program, with more than 90 million
participants, already uses this technology to process
troves of data.
The IOT also has many applications in the
aviation industry, where it is used to provide real-
time data on everything from performance of critical
aircraft components to maintenance schedules.
Interconnected networks of sensors and data hubs
at some airports also allow operators to track and
improve their understanding of passenger flow and
behavior.
Many Indonesian business groups have meanwhile
started to ramp up their investments in the digital
economy over the past five years, cognizant of the fact
that this technology will accelerate growth. Starting
with investment in diversified startups, these groups
have seen how the implementation of the IoT can
make operations in their brick-and-mortar stores
more efficient and most importantly, allow them to
respond to changing customer behavior as millions
now conduct their business transactions online.
Many business groups have invested large amounts
of money to acquire startups or establish their own
companies (see table). Indonesia’s Djarum Group and
Astra International invested in Go-Jek to strengthen
their businesses. Astra uses Go-Jek to boost its
marketing and sales, while Djarum provides customers
with easier payment methods.
The Lippo Group meanwhile, has entered the
digital era at an even higher level with the recent
signing of an agreement with Japan’s Softbank, which
is expected to give the Indonesian conglomerate a
major advantage over its competitors.
CoNsumptioN RemAiNs stAble
While the IoT is on the rise, optimism about the
local economy is still resilient. Despite a weakening
rupiah, slowing consumption and negative global
economic sentiment, listed companies saw an average
22.3 percent rise in net profit, compared with an
average rise of about 16 percent over the last decade.
At the same time, the number of local investors also
increased to around 40,000 actively trading every day.
The performance of companies in consumer
goods production and trade also remains stable,
with outstanding revenues and net profit growth.
Erajaya Swasembada, a company active in the sales
and distribution of telecommunication products, saw
revenue growth of more than 20 percent so far this
year, compared with to the same period last year.
The company also posted a 28 percent year-on-year
increase in net profit.
Consumer goods giant Indofood Sukses Makmur
of the Salim Group booked stable revenue growth of
between 6 percent and 8 percent over the past five
years, while Astra International, one of Indonesia’s
largest diversified conglomerates, also posted
significant sales growth (see table). Worth mentioning
is the banking and financial sectors, which despite
slow growth in credit disbursement over the past year,
still managed to grow faster than the overall national
lending industry.
These examples show that Indonesia’s
consumption remains positive despite some
adjustments. Rhenald Kasali, professor in management
science at the University of Indonesia, sees this trend
as a shift in customer behavior, with more shops
closing down as people increasingly turn to online
shopping. Among middle-come earners, luxury goods
purchases are no longer considered a matter of pride
and they now tend to spend more money on travel.