RNI's President Director: Our Sectors Are Extremely Profitable  

Innovation is key according to Ismed Hasan Putro. The president director of state-owned agriculture firm Rajawali Nusantara Indonesia (RNI) has proven to make tons of changes since he came into position in 2012, one of which has been to develop the commodity business aside from sugar and palm, which is RNI’s main business. 

Underneath the leadership of Ismed, who is also a former journalist, RNI launched various products such as Raja Daging (beef), Raja Gula (sugar) and Raja Teh (tea). RNI also plans to develop a soybean business. 

The company currently has 13 subsidiaries and seven affiliations. 

Tempo’s Ananda Putri took the opportunity to have a chat with Ismed and hear him reveal his strategies in RNI’s development. Excerpts from the interview:

RNI has so many subsidiaries, how do you plan to develop it?

I will develop a new business that still has a correlation with sugar and palm. For example, Rajawali Citra Mas, (the subsidiary) that creates packages, will be asked to develop plastic packaging. Then, Mitra Kerinci that produces tea will make the product Raja Teh and will not only be export oriented. As for the retail business, we aim at building 10,000 outlets. All of these plans will be implemented gradually, some with help from banks. 

RNI has ventured into the beef, soybean and tea business lately. Where did that idea come from?

Business wise, our new sectors are extremely profitable. Yet aside from that, we want to help the government reduce the price hike of foodstuff. 

Is it possible for RNI’s sources to enter these sectors?

We are extremely prepared for the beef business. We already collaborated with a plasma core system for the supply of the beef. We also have a freezer with a capacity to hold 50 tons and will soon obtain a license to construct a slaughterhouse. Aside from that, RNI also has distributors, Rajawali Mart and Waroeng Rajawali, which are located in 42 cities. 

How will you realize the sale of beef for the Raja Daging brand?

Up until last August, we have already slaughtered 500 cattle through the Sapi Tebu (Sugar Cattle) program, Sapi Sawit (Palm Cattle) program, Sapi Teh (Tea Cattle) program and the Partnership Farmer Program that was developed since 2012. 

Won’t the company suffer losses by implementing a price below the market price?

By selling Raja Daging (products) at Rp70,000 per kilogram, we have already gained a profit. We made a small investment, Rp50 billion for the land, barns, and others. The capital will slightly increase when we construct the slaughterhouse. This program is still new so I haven’t set a high target. Our main business is still sugar and palm. We only sell beef to make use of the land and sugar cane residue for leftover feed.  

What is RNI’s plan in developing the soybean business?

We are in the middle of preparing to plant soybeans in Subang, West Java. Some time ago, we experimented by planting soybeans before planting sugar canes and had positive results. We were able to harvest 25 tons of soybeans. In October and November, we plan to plant soybeans again through intercropping before cultivating it on 500 hectares of land. 

What about RNI’s sugar business?

The sugar business contributes to 55 percent out of the whole income, it is still the largest portion. So far, RNI has been selling sacks of sugar. I innovated through the Raja Gula brand to sell them in smaller packages. This was extremely profitable compared to selling sacks (of sugar) to major traders. Aside from marketing it in Rajawali Mart, we marketed it in Carrefour this month.  

After venturing in all of these businesses, how did RNI’s financial performance do?

During the first semester it remained positive. Up until the end of this year, we target a net income of Rp499 billion. Imagine, in 2011, RNI still suffered losses. Yet after making some efficiency changes and innovations, RNI earned a net profit of Rp270.32 billion or up 338.77 percent. (*)