PTBA - Big transformation plan to energy and chemical company

PTBA - Big transformation plan to energy and chemical company Bukit Asam (PTBA) has prepared its business roadmap, including an increase on energy contribution. Currently, coal dominates its revenue by 95%. PTBA planned to increase its contibution to 30% in 2030. Going forward, it is targetting to transform its business into chemical company through downstreaming program in 2040. Furthermore, PTBA commited to be well-known as energy and chemical company in 2050. (Source : Kontan) Comment : Given its big business strategy, we see that PTBA will maintain its core business above 50% as the downstream energy should have absorbed its raw material. However, it is expected to develop technology for carbon emission reduction efforts gradually. We also see that PTBA will optimize its long coal's mining life given higher resources and reserves. In current state, PTBA has ongoing SPPP, wind project as well as dimenthyl ether initiation to pursue. Overall, we like PTBA's vision and mission considering unfavorable long-term coal business prospect.