The conglomeration firm, PT Astra International Tbk (IDX: ASII) cut nearly half of its capital expenditure for this year due to the COVID-19 pandemic, an official said today - Photo by the Company

JAKARTA (TheInsiderStories) – The conglomeration firm, PT Astra International Tbk (IDX: ASII) cut nearly half of its capital expenditure (capex) for this year due to the COVID-19 pandemic, an official said today. Initially, the group prepared an investment budget of up to Rp25 trillion (US$1.78 billion) for business expansion.

“Total capital expenditure (including investment) for 2020 will be around Rp11 trillion, half of the initial budget due to a pandemic,” the head of communication officer, Boy Kelana, told TheInsiderStories on Tuesday (05/16).

Beside, he continued, the publicly listed firm will focus on controlling costs and protecting the cash flow. Astra will also review projects and ongoing investments or to delay projects that are not critical.

Earlier, this year’ capex will be absorbed by its subsidiaries such as heavy equipment company, PT United Tractors Tbk (IDX: UNTR), plantation firm PT Astra Agro Lestari Tbk (IDX: AALI), and other subsidiaries. The source of the spending is obtained from internal cash.

Since last year, unit of Jardine Cycle & Carriage, start to look at other businesses replacing the businesses that are starting to fade. Through its subsidiary PT Astra Digital Internasional, the issuer is ready to develop four digital platforms as innovative products to meet the community’s demand.

The group’ investment in the digital sector did not only flow to multi-platform provider GoJek, which is currently invested Rp3.5 trillion, but also looking another startups. Going forward, the company will continue to increase its investment portion, especially for the four Astra Digital platforms, namely Seva.id, CariPark, Sejalan, and Movic.

He explained Seva.id is a web-based digital platform to accommodate the needs of people who want to buy a new vehicle. Then, CariPark, the application to make it easier for users to find a parking space. And, Sejalan is an application that can bring together drivers and passengers who have a one-way trip. Finally, Movic is an application for vehicle rental.

Its other units, PT Astra Tol Nusantara (Astra Infra), also ready to expand the port business in line with the planned move of the country’s capital to East Kalimantan. According to the CEO Djap Tet Fa, the port business was one of the company’ focuses alongside the toll road.

Currently, the Astra Infra port business line is run by PT Pelabuhan Penajam Banua Taka. The port is also known as Astra Infra Port Eastkal.

“We have a public port license. When there is a construction of a new capital city, we need tools and materials. The hope is that (loading of tools and materials) can pass through our port,” he said.

He added that currently, the port managed by Astra Infra in Penajam has a land area of ​​95 hectares and manages a 200-meter warehouse, workshop, and jetty that can accommodate 10,000 deadweight tonnage vessels.

For expansion, Tet Fa said, that the company is aiming for an additional 100 hectares of land. This year, Astra Infra intends to expand the open yard or open yard and extend the pier to 350 meters to 400 meters. So far, Astra Infra Port Eastkal serves as a shore base for the oil and gas industry, the mining industry, and the Astra business group.

US$1=Rp14,000

Written by Staff Editor, Email: theinsiderstories@gmail.com