Matahari to Spend Rp 1.8t to Expand Hypermart Portfolio

ID/Harso Kurniawan

Retailer Matahari Putra Prima plans to invest Rp 1.8 trillion ($189 million) over two years as Southeast Asia’s largest economy continues to show strong performance on the back of domestic consumption.

Matahari president director Benjamin Mailool said on Wednesday that the company intends to open at least 20 new Hypermart supermarkets next year.

“Currently, Matahari is focusing on developing its Hypermart business with a target of 25 percent in sales growth a year in line with the expansion of our outlets,” he said.

As of August, Matahari had opened seven Hypermart outlets, with 10 more to follow by the end of the year. Matahari also plans to expand its pharmaceutical business by opening at least 17 new Boston Health and Beauty outlets. It runs 72 hypermarkets in 50 cities nationwide

Danny Konjoniang, director of corporate communications at Matahari, said the company’s target to open 17 stores was the highest in its history.

“Hypermart is the main driver of our company growth. It contributes around 95 percent of Matahari’s sales, while the remaining comes from non-core businesses like Timezone and Time Bookstore,” he said.

Danny said the company was eyeing opportunities in the eastern region with four new outlets to be opened in Ambon and Jayapura. He added that Matahari was planning to divest its non-core assets worth Rp 3.2 trillion to its holding company, Multipolar, and planned to boost its presence in the mini-market business with a brand called Bigmart.

“We had opened two Bigmart mini-markets in Bogor, West Java, with an investment of Rp 1 billion each,” he said.

Matahari’s focus on retailing came after a recommendation from Merrill Lynch, who also suggested they form a partnership with a global retailer. Danny said the company was open to taking in a partner but no progress has been made.

Matahari is controlled by the Lippo Group, which owns the Jakarta Globe.