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LISTED COMPANY - JAKARTA. The household equipment sector stocks are becoming more active. The Indonesia Stock Exchange (IDX) this time welcomes PT Homeco Victoria Makmur Tbk, also known as Homeco Living.
The issuer with the stock code LIVE officially listed on the stock market on February 12, 2024. LIVE set the offering price at IDR 148 per share, offering as many as 808.35 million shares or 17.60% of the total issued and paid-up capital.
LIVE is estimated to have raised funds of IDR 119.63 billion from the IPO event.
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For information, Homeco Victoria Makmur was established in 2012, based in West Jakarta. Initially, Homeco Living only handled the import and export business of household appliances, but over time this company continues to expand its business wings.
Homeco Living sells various product categories ranging from wholesale stationery and drawing tools under the Wiggle brand, children's toys and games under the Technoplast brand, household appliances, and equipment under the BerlingerHaus, Le Cuisine, Portofino, and other brands, as well as textile products under the KNTG brand.
This consumer cyclical sector issuer has created an integrated supply chain system by selling products to more than 40,000 sales points in modern markets in almost all cities in Indonesia. Where the growth of Homeco's business relies on efforts to grow sales results and product development through the application of organic growth and inorganic growth strategies.
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One of the efforts made by Homeco Living for organic growth strategy is by creating new products, expanding product categories by adding a variety of international brands, creating environmentally friendly product innovations, and expanding sales areas through cooperation with Affiliates and/or third parties.
Homeco Living has collaborated with several retail companies as distribution partners, such as PT Sumber Alfaria Trijaya Tbk (Alfamart), Lion Super Indo (Super Indo), Lotte Shopping Indonesia (Lotte Wholesale), and others.
Meanwhile, the inorganic growth strategy is implemented by compiling a business portfolio through cooperation or acquiring business or production facilities. In June 2023, Homeco Victoria Makmur was restructured by acquiring PT Trisinar Indopratama (TSI).
Homeco officially became the parent company of TSI, which has a business focus on the plastic goods industry for packaging, children's toys, other plastic goods, household appliances and equipment (excluding furniture) under the Technoplast brand with more than 24 years of experience.
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One of the advantages of LIVE is the coverage of sales areas that have spread almost all over the cities in Indonesia. LIVE supplies its products to consumers through modern markets with a more structured mechanism in the form of establishing partnerships with distribution partners in the form of retail and e-commerce, as well as general markets where products are sold through traditional markets, grocery stores, and other small stores.
In modern markets, Homeco products are sold at more than 40,000 sales points in Indonesia. In the general market, more than 700 parties act as distribution partners for Homeco products covering almost all major cities in Indonesia, especially on Java and Bali islands.
However, LIVE realizes that competition is something that cannot be avoided in running a business. Competition in the household appliances and equipment industry is based on several factors including brand recognition and loyalty from consumers, product quality and reliability, product design and innovation, sales area, and price.
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Therefore, to maintain competitive advantage, LIVE is committed to continuously innovating products following consumer needs, as well as maintaining cooperative relationships with distribution partners. Thus, LIVE is confident that the product can compete competitively in Indonesia and can anticipate competition that will emerge in the present and future.
Homeco Living assesses that the company's inability to innovate and maintain competitive advantage, as well as the availability of products sold will harm the existence of products which ultimately affects the company's profitability level. The risk of competition in providing an effective and efficient marketing network is also an important factor.
In addition, LIVE also anticipates the risk of purchasing power and changes in consumer tastes. Because the national economic conditions and the proliferation of social media influence consumer purchasing power to buy a product. Therefore, LIVE continues to move to provide products following consumer preferences and purchasing power.
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Targeting Revenue Growth of 100%
Nevertheless, PT Homeco Victoria Makmur Tbk is optimistic in targeting revenue growth of up to 100% in 2024. This revenue target will be pursued in line with the company's plan to expand product categories.
For information, Homeco recorded revenue of IDR 134.22 billion, or down 7.92% YoY as of July 31, 2023. Meanwhile, the current year's profit was seen soaring around 214.52% to IDR 19.64 billion.
The President Director of PT Homeco Victoria Makmur Tbk, Ellies Kiswoto, said that LIVE is preparing to re-acquire new products. Currently, LIVE is exploring eight companies to expand its product categories.
"The initial stage target is more towards improving product categories because that's in our pipeline. So the expansion will focus on categories first," said Ellies after the LIVE stock listing ceremony, on Monday (12/2).
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The President Commissioner of Homeco Victoria Makmur, Sjamsoe Fadjar, revealed that the company's brilliant performance in recent years is the background of LIVE's listing on the stock market. Where Homeco recorded full-year revenue growth of 86.53% and net profit growth of 458% in the previous year 2022.
"Going forward, management will always maintain the company's growth to increase value for shareholders," said Sjamsoe.
The plan for the use of IPO funds will be used for debt repayment and business expansion capital. Funds of around IDR 25 billion will be used to pay off some of the debt to PT Bank Central Asia Tbk which will mature on August 1, 2024. Then IDR 25 billion will also be used to pay off some of the business debt of the Homeco entity, namely PT Trisinar Indopratama (TSI) to PT Bank Central Asia Tbk.
Meanwhile, the rest will be used by LIVE for business development in the form of working capital. Starting from the purchase of inventory, supporting materials, and merchandise to marketing and other operational costs.
