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Business Times
3 days ago
- Business
- Business Times
Malaysian tycoons tap Indonesia's digital and logistics boom
[JAKARTA, KUALA LUMPUR] They made fortunes in palm oil, resorts and retail. Now, some of Malaysia's prominent tycoons, including Wilmar's Robert Kuok and Genting Group's Lim Kok Thay, are quietly funnelling serious money into Indonesia's digital and logistics sectors. It is not a new play but a strategic one, reflecting how Malaysian money is chasing South-east Asia's biggest economy, where clicks are starting to matter more than commodities. Malaysian investors have poured some US$905 million into Indonesia's digital space so far, with deal activity peaking in 2023 at US$229 million – even higher than the pandemic-era surge of US$214 million in 2021, data from startup intelligence platform Tracxn showed. 'The post-Covid recovery and structural demand shifts are driving sustained activity,' said Neha Singh, co-founder and chief executive officer of Tracxn. She added: 'Despite global headwinds, Malaysia's interest in Indonesia's digital sector has only grown stronger.' From commodities to clicks For decades, Malaysian capital poured into Indonesia's abundant natural resources, from palm oil estates in Kalimantan to mining ventures in Sumatra. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up Many struck it rich. Tycoons such as Robert Kuok and Lim Kok Thay turned raw commodities into profit engines, cementing their place further among Malaysia's wealth elite. Other Malaysian players, from logistics outfits to venture-backed startups, have also expanded their footprint in Indonesia's digital economy. As Indonesia's 280 million-strong population grows more urbanised, tech-savvy and digitally connected, the nature of consumption and investment is changing. Malaysia's business elites have taken note. Indonesia's digital economy presents a compelling opportunity for Malaysian investors, driven by several strategic advantages, noted Tracxn's Singh. 'The two countries share close geographical proximity, cultural similarities and strong diplomatic ties – all of which make cross-border business engagement more seamless,' she said. Jerry Goh, investment director of Asian equities at Aberdeen, notes that Indonesia's expanding middle class and rising purchasing power are laying a solid foundation for long-term growth in digital commerce. 'This shift is fuelling stronger consumer spending, particularly within the digital economy,' he said. The rapid growth of smartphone adoption and Internet connectivity has significantly expanded Indonesia's online consumer base – particularly in the gaming sector, which is valued at an estimated US$2 billion, indicated the country's Ministry of Communication and Digital Affairs. Sensing long-term potential, Genting's Lim – who is credited for growing the family-controlled business empire into a global casino and leisure giant – has made a strategic play through investment arm Genting Ventures by backing Jakarta-based Evos Esports – one of South-east Asia's top online gaming platforms. The venture firms also took part in a US$6.2 million funding round for Eratani, an Indonesian agri-tech startup, capitalising on the rising momentum of digital transformation in the country's agriculture sector. Jeffrey Cheah, founder of Malaysian conglomerate Sunway Group, has also broadened his regional footprint through venture capital, teaming up with Jakarta-based investment firm Kejora Capital to launch the Orbit Malaysia Fund, an investment vehicle aimed at supporting startups across South-east Asia, with Indonesia as a key focus. Beyond market size As South-east Asia's largest automotive market, Indonesia remains a pivotal growth engine for Carsome, Malaysia's biggest used car platform, which has been operating in the country since 2017. Carsome is backed by businessman Patrick Grove, the billionaire behind Catcha Group and iflix. Grove ranked 48th on Forbes' list of Malaysia's richest individuals in 2025, with a net worth of US$345 million. Eric Cheng, Carsome's co-founder and chief executive officer, says that the company's expansion into Indonesia was driven by more than just its market size. PHOTO: CARSOME Eric Cheng, co-founder and CEO of Carsome Group, emphasised that the company's expansion into Indonesia was driven by more than just its market size. 'Indonesia's growing appetite for used vehicles, alongside a rising preference for digital-first experiences, made it a natural next step in our regional expansion,' he told The Business Times. While macroeconomic challenges and a softer automotive market in 2024 have weighed on the broader industry, Cheng said that Carsome is using this period to strengthen its operations in the country. 'We will be re-investing with more precision, buying the right inventory, improving unit economics and applying learnings from our turnaround in Malaysia,' he noted. Warehousing: new goldmine Experts view Indonesia's booming digital storefront sector as a key driver of long-term growth for the delivery and logistics industry. Gary Tan, portfolio manager for the intrinsic emerging markets equity team at Allspring Global Investments, said the growing demand for fast and reliable shipping has significantly boosted the valuations of supply chain companies – making them increasingly attractive to equity investors and reflecting strong confidence in the sector's long-term prospects. This is where many Malaysian investors are making early, strategic moves. They are not just backing consumer-facing digital ventures, but also investing in the physical infrastructure essential to powering South-east Asia's digital evolution. Wilmar's Kuok, for instance, made an early move into Indonesia's logistics space through Kerry Logistics, where he holds a significant stake. In 2015, Kerry entered a joint venture with local player Puninar Logistics, tapping the country's fast-growing logistics sector, with a strategic focus on inter-island distribution. Kuok topped Forbes Malaysia's 50 richest list in 2024 with an estimated net worth of US$11.8 billion. Mr DIY store in Jakarta. The Malaysian home improvement retailer has been ramping up its expansion in Indonesia following the IPO of its local unit at the end of last year. PHOTO: ELISA VALENTA, BT Meanwhile, Malaysian home improvement retailer Mr DIY – owned by tycoon brothers Tan Yu Yeh and Tan Yu Wei, and their family – has been ramping up its expansion in Indonesia following the initial public offering of its local unit at the end of last year. To support the roll-out of hundreds of new stores in second-tier cities, the company has built a nationwide network of warehousing hubs in partnership with local logistics firms – including one of its largest facilities in Marunda, North Jakarta. Since entering the market in 2017, Mr DIY has rapidly grown to nearly 900 branches nationwide, including in underserved regions. Jai Mirpuri, head of South-east Asia at real asset management group ESR, emphasised that Indonesia's growing automotive sector, particularly in electric vehicles, has attracted significant investments into manufacturing, assembly, and storage space requirements. This further boosts the demand for modern logistics real estate in the country. 'We see attractive investment opportunities in modern warehouses and even data centres that support the broader digital economy,' he said. Geographically complex Despite strong enthusiasm, Indonesia's burgeoning digital economy faces significant challenges. Industry players acknowledged that building efficient logistics networks across an archipelago of more than 17,000 islands is akin to threading a needle. Outside Java and Sumatra, low order density and high transportation costs create logistical headaches. 'Order fulfilment becomes expensive in remote regions. Logistics providers are under pressure to cut costs, especially in a cash-on-delivery environment,' said Swati Chopra, executive director, emerging markets equity, at investment manager Franklin Templeton. 'This requires deep pockets and a long-term view.' Cheng from Carsome noted that Indonesia's vast geography added another layer of complexity, creating supply chain fragmentation and delivery inefficiencies. 'While digital adoption is rising, we quickly learnt that many consumers still prefer face-to-face interactions when buying cars. This required us to complement our digital model with strong on-the-ground engagement to build trust and deliver the experience customers expect.' Cut-throat competition Indonesia's e-commerce sector, while brimming with potential, is among the most fiercely contested in South-east Asia, with both local and international players vying for market share. Indonesia's e-commerce sector is highly polarised, with Shopee and Tokopedia controlling about 71% of the 2022 gross merchandise value. PHOTO: YEN MENG JIIN, BT The market is highly polarised, with Shopee and Tokopedia controlling about 71 per cent of the 2022 gross merchandise value, leaving other platforms to compete for a much smaller share of the market. Indonesia has witnessed the permanent closure of more than a dozen marketplaces, including some that existed before the Covid-19 pandemic. Major players such as Elevania and – China's JD Indonesia unit – have officially shuttered in recent years, with closing its operations in March 2023 after a period of gradual downsizing. Franklin Templeton's Chopra highlighted that with price-sensitive consumers and intense competition, digital marketplaces must invest heavily in user acquisition and retention. This makes long-term survival and growth especially challenging for both new entrants and some established players. 'In the short term, profitability may remain limited due to fierce competition, so patience is essential. We expect further industry consolidation, resulting in larger, stronger and better-capitalised players,' she said.
New Straits Times
28-05-2025
- Business
- New Straits Times
PPB posts higher net profit of RM375.83mil in 1Q25
KUALA LUMPUR: PPB Group Bhd's net profit rose to RM375.83 million in the first quarter ended March 31, 2025 (1Q 2025) from RM337.17 million in 1Q 2024, while its revenue also increased to RM1.35 billion in 1Q 2025 from RM1.29 billion previously. In a filing with Bursa Malaysia today, the group attributed its performance to higher contributions from Wilmar International Ltd, which increased to RM283 million in 1Q 2025 from RM266 million previously. PPB owns an 18.8 per cent equity interest in Wilmar, one of Asia's largest integrated agribusiness groups. "At the same time, core business segments recorded a 25 per cent increase in profit to RM127 million in 1Q 2025 (1Q 2024: RM102 million)," it said. On prospects, it said the grain and agribusiness segment will continue to closely monitor global grain prices and adopt prudent sourcing strategies, given the commodity market's vulnerability to adverse weather conditions in key grain-producing regions and evolving government policies. "These challenges are further compounded by heightened global uncertainties and economic pressures arising from the escalation of United States tariff measures. "Nonetheless, the group remains committed to upholding high product quality by leveraging its technical expertise and delivering reliable customer service. We are confident in our ability to remain resilient and deliver a satisfactory performance in 2025," it added. Meanwhile, PPB said the consumer products segment will continue to expand its product range and strengthen its market presence to enhance distribution efficiency amid rising operating costs. "Supported by resilient domestic household spending, a well-established distribution network and robust logistics infrastructure, the segment is well-positioned to respond effectively to evolving market demand and is expected to deliver a satisfactory performance in 2025," it said. — BERNAMA TAGS: PPB, result, 1Q 2025, Wilmar
Straits Times
08-05-2025
- Politics
- Straits Times
Forum: Guest lists should be screened when ministers attend private events
I refer to the report 'Man at dinner with Fujian gang member Su Haijin wrongly identified as Wilmar chairman' (May 7), which raises serious concerns about security protocols and ministerial engagement in private settings. While ministers Ong Ye Kung and Chee Hong Tat have clarified that they did not know Su and were invited by a mutual acquaintance, such situations can present reputational and security risks, regardless of intent. When ministers attend private social functions where unknown individuals are present, without clarity on their background or motives, it exposes them to potential security threats and can invite public doubt, undermining trust in governance. Singaporeans expect our ministers to uphold not only the highest standards of conduct, but also to avoid any situation that could be perceived as compromising. It is timely for the Government to review and strengthen existing protocols for ministers' attendance at non-official events, particularly those involving guests outside their professional or community circles. Implementing measures such as guest list vetting, having a security or official aide present, and risk screening will enhance transparency, safeguard ministerial integrity, and reassure the public on matters of both personal and national security. Our ministers' dedication is not in question. But today, perceptions can matter as much as intent. Cheong Wing Kiat More on this Topic Forum: What readers are saying Join ST's Telegram channel and get the latest breaking news delivered to you.
The Star
08-05-2025
- Business
- The Star
Man at dinner with Fujian gang member Su Haijin wrongly identified as Wilmar chairman
Wilmar has issued a statement saying that a man in widely circulated photos of a dinner with convicted Fujian gang member Su Haijin has been wrongly identified as its chairman and CEO. - Photo: ST SINGAPORE: One of the men photographed at a dinner attended by several Cabinet ministers and convicted Fujian gang member Su Haijin has been wrongly identified as the chief executive of commodities giant Wilmar. The photos, which are being widely circulated, carry a caption in Mandarin identifying one of the men as Kuok Khoon Hong, who is Wilmar's chairman and chief executive. In a statement on Wednesday (May 7), Wilmar said the man in the photos is not Kuok. Others in the photos are Cabinet ministers Ong Ye Kung and Chee Hong Tat, both of whom said they did not know Su and have not had any contact with him – before or since the dinner. The ministers' spokesmen, in a joint statement on May 6, said: 'As ministers, they meet a diverse range of people at various events and gatherings. They attended the dinners at the invitation of a friend, and Su happened to be there.' The Government upholds a high standard of integrity, which ministers are determined to maintain, even if, in the course of their work, they may inadvertently come into contact with people who are later found to be unsavoury, the statement added. 'Maintaining this standard is non-negotiable,' it said. Su, a Cypriot national, faced 14 charges and was sentenced to 14 months in jail on April 4, 2024. He was deported to Cambodia on May 28 of the same year. He was one of 10 people found guilty of being involved in a $3 billion money laundering case, which was one of Singapore's largest. Also seen in the photos is Singapore tycoon Sam Goi, dubbed the 'popiah king'. One group photo shows Goi with Su, Ong and former manpower minister Lim Swee Say. Labour chief Ng Chee Meng also said he was at the dinner. He added that he had no further interactions with Su after police investigations and criminal charges were brought against him. Goi said the dinner with Su and Ng took place 'around 2020', Bloomberg News reported. He also said he had organised and paid for the meals that Su and the ministers had. The dinner took place before Singapore implemented strict Covid-19 pandemic restrictions in 2020. 'It's all for friends and I paid for them all,' Goi said, adding that he has not kept in touch with Su. Ng said it is part of his work to engage with different companies and private sector leaders. 'These engagements help me better understand the concerns and challenges in different industries,' he said, adding that people would often approach him for photographs at these meetings. 'This dinner was one such engagement,' Ng said. - The Straits Times/ANN
Yahoo
08-05-2025
- Politics
- Yahoo
Man at dinner with Fujian gang member Su Haijin wrongly identified as Wilmar chairman
Wilmar has issued a statement saying that a man in widely circulated photos of a dinner with convicted Fujian gang member Su Haijin has been wrongly identified as its chairman and CEO. SINGAPORE - One of the men photographed at a dinner attended by several Cabinet ministers and convicted Fujian gang member Su Haijin has been wrongly identified as the chief executive of commodities giant Wilmar. The photos, which are being widely circulated, carry a caption in Mandarin identifying one of the men as Mr Kuok Khoon Hong, who is Wilmar's chairman and chief executive. In a statement on May 7, Wilmar said the man in the photos is not Mr Kuok. ADVERTISEMENT Advertisement Others in the photos are Cabinet ministers Ong Ye Kung and Chee Hong Tat, both of whom said they did not know Su and have not had any contact with him – before or since the dinner. The ministers' spokesmen, in a joint statement on May 6, said: 'As ministers, they meet a diverse range of people at various events and gatherings. They attended the dinners at the invitation of a friend, and Su happened to be there.' The Government upholds a high standard of integrity, which ministers are determined to maintain, even if, in the course of their work, they may inadvertently come into contact with people who are later found to be unsavoury, the statement added. 'Maintaining this standard is non-negotiable', it said. ADVERTISEMENT Advertisement Su, a Cypriot national, faced 14 charges and was sentenced to 14 months in jail on April 4, 2024. He was deported to Cambodia on May 28 of the same year. He was one of 10 people found guilty of being involved in a $3 billion money laundering case, which was one of Singapore's largest. Also seen in the photos is Singapore tycoon Sam Goi, dubbed the 'popiah king'. One group photo shows Mr Goi with Su, Mr Ong and former manpower minister Lim Swee Say. Labour chief Ng Chee Meng also said he was at the dinner. He added that he had no further interactions with Su after police investigations and criminal charges were brought against him. ADVERTISEMENT Advertisement Mr Goi said the dinner with Su and Mr Ng took place 'around 2020', Bloomberg News reported. He also said he had organised and paid for the meals that Su and the ministers had. The dinner took place before Singapore implemented strict Covid-19 pandemic restrictions in 2020. 'It's all for friends and I paid for them all,' Mr Goi said, adding that he has not kept in touch with Su. Mr Ng said it is part of his work to engage with different companies and private sector leaders. 'These engagements help me better understand the concerns and challenges in different industries,' he said, adding that people would often approach him for photographs at these meetings. 'This dinner was one such engagement,' Mr Ng said. Source: The Straits Times © SPH Media Limited. Permission required for reproduction Discover how to enjoy other premium articles here
