International Finance Corporation (IFC), a member of the World Bank Group, announced that it will invest up to 451 billion rupiah ($31 million) in convertible bonds into Indonesia’s logistics player PT Adi Sarana Armada (ASSA).
Established in 1990, IDX-listed ASSA started off as a vehicle rental company before expanding to other services such as vehicle auction, and logistics, among others. It subsequently launched its IPO on the Indonesian Stock Exchange in 2012.
Currently, ASSA has a fleet size of 25,000 vehicles under its rental business. The company also has a complementing car-sharing service under the ShareCar application platform.
With the investment, ASSA is looking to scale its express logistics entity PT.Tri Adi Bersama, also known as Anteraja, and broaden its e-commerce logistics footprint in Indonesia. Anteraja claims to have deliver over 700,000 parcel orders per day.
SMEs, key incubators of jobs in Indonesia, as well as millions of female entrepreneurs who rely on the rapidly growing e-commerce market as a key source of trade and income will stand to benefit from the expansion of last-mile delivery and pick-up services.
“This crucial investment will unlock access to goods and services and will also benefit millions of people who live outside Indonesia’s major population centers, including those in poorer regions who often also face higher prices due to logistics constraints and transport costs,” said Alfonso Garcia Mora, IFC vice president for Asia and the Pacific. “The COVID-19 pandemic is exacting a huge human and economic toll on the people of Indonesia, making investments like this, which will help preserve and create jobs, even more critical.”
Mass digitalisation and internet penetration are driving the development of Indonesia’s e-commerce market, which currently accounts for $12 billion per year in gross merchandise value, projected to grow to $30 billion per year by 2025.