Retail News CRM

Author: Mei Ling Tan

  • Royal Enfield enters Indonesian market

    Royal Enfield enters Indonesian market

    Royal Enfield has entered Indonesian market targeting mid-size motorcycle segment and an exclusive store in Jakarta, the company said Monday, adding that the move into the world’s third largest two-wheeler is part of its growth strategy and international thrust to expand its presence in the mid-sized motorcycle segment (250-750cc).

    The company announced the foray at GAIKINDO Indonesia International Auto Show 2015. The two-wheeler major displayed its range of motorcycles at the show including the Bullet 500cc, the retro-street models – Classic 500cc and Classic Chrome and the Continental GT (535cc) cafe racer.

    Abhijit Singh Brar, head of marketing for Royal Enfield, said the company will commence retail operations soon from its exclusive dealership in Jakarta that is being set up in partnership with PT Distributor Motor Indonesia. In addition to the store, they will also build service and aftermarket capability for Royal Enfield in Jakarta.

    Backed by a growth of over 50% year on year in the past five years, the company is aiming to lead and grow the middle-weight segment, which is underserved globally. The move to enter Indonesia is part of the company’s larger growth strategy which includes a thrust on expanding its international presence.

    The company believes this growth will largely come from markets like India such as Latin America – it entered the Colombian market last year – and South East Asia, given their size and comparable commuting trends.
    Indonesia is a strategic market for Royal Enfield. With its large commuter based, this market has enormous potential to upgrade to the next level of motorcycles, should there be optimal product choice.

    “We will build our presence from Jakarta and depending on the response, we will expand our footprint to the other key cities in Indonesia,” said Arun Gopal, head for international business at Royal Enfield.
    In 2014, Royal Enfield sold more than three lakh motorcycles globally. In 2015, the company aims to produce 4.50 lakh motorcycles to supports its growth strategy globally.

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  • CapitaLand may sell Rivervale Mall

    CapitaLand may sell Rivervale Mall

    Singapore property conglomerate CapitaLand has confirmed it is reviewing its options for the future of Rivervale Mall.

    “CapitaLand Mall Trust has not come to any decision or entered into any agreement or transaction in connection with the options, nor is there any certainty or assurance that CMT will enter into or conclude any such transactions,” the company said in a disclosure to the Singapore stock exchange.

    The company said the consideration was in line with its policy of continually evaluating its portfolio of assets “and exploring opportunities to maximise” their value.

    Rivervale Mall is located in the Sengkang housing estate close to Rumbia LRT station in the north-eastern region of Singapore. The three-storey mall has a net lettable area of 81,159 sqft and serves the local community.

    Key tenants include NTUC Foodfare, Daiso, Bata, Eu Yan Sang TCM, McDonald’s, Long John Silver’s, Guardian, KFC, BBQ Chicken, Watsons, Kimage, NTUC Denticare, Unity NTUC Healthcare.

    In 2014, it had a footfall of 9.9 million.

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  • Missha expands in Vietnam

    Missha expands in Vietnam

    Korean cosmetics retailer Missha has opened its 15th retail store in Vietnam.

    The newest store, at Cach Mang Thang St in downtown Ho Chi Minh City, is located in a neighbourhood popular with tourists and locals.

    Besides its focus on Vietnam’s most populous city, Missha is expanding in other Vietnamese cities. In April it opened in the holiday resort of Danang

    Missha Korea has 1650 stores in 29 countries including about 110 in Southeast Asian markets including Indonesia, Thailand and Singapore.

    The company says it sold US$570,000 worth of products in Vietnam in the first half of 2015, up 32.5 per cent on the same time last year.

    The Korea Cosmetics Industry Institute predicts Vietnam’s cosmetics markets will grow by 17.5 per cent this year, making it the second fastest growing market in Asia, behind India.

    “With Missha’s main items of makeup cosmetics, including mascaras and BB creams, we will accelerate the market invasion in Vietnam,” said Lee Kwang-sup, chief manager of Missha’s overseas business unit.

    “As Missha has already been established as one of the most popular brands in the country, we will dominate the market in advance by actively expanding stores.”

  • Studio City retail tenants revealed

    Studio City retail tenants revealed

    Studio City and Taubman Asia, have revealed the lineup of fashion brands that will open inside The Boulevard at Studio City.

    A mix of fashion-forward labels and internationally-renowned luxury brands include Macau’s first Balmain, Macau’s first Belstaff, and Tom Ford’s largest store in Asia, amongst many others. The selection was assembled by Taubman Asia and Melco Crown Entertainment’s combined team of retail specialists to meet Chinese consumers’ increasing desire to express their individuality through high quality, expertly crafted clothing and accessories. Bespoke and personal services will be offered to ensure our shoppers take center stage.

    Taubman says The Boulevard at Studio City will bring “an unparalleled shopping experience” to Studio City.

    “Unlike any retail offering to be found in Asia, the unique 35,000 sqm ‘immersive’ retail entertainment environment brings shopping to life by ‘transporting’ visitors to high-energy street-scapes and entertaining them at every turn with featured streets and squares inspired by iconic shopping and entertainment locations, including New York’s Times Square and Hollywood’s Beverly Hills,” Taubman said in a statement.

    “At the futuristic Times Square Macau, inside The Boulevard at Studio City, a variety of entertainment from ‘virtual’ musicians to film stars will be shown through holographic projections.

    “Leveraging our global expertise increating extraordinary retail environments, and our exceptional relationships with the world’s leading brands, our talented team in Asia has brought together an exciting mix of brands for The Boulevard at Studio City,” said René Tremblay, president of Taubman Asia.

    “Our merchandising and management services are the industry standard for performance and excellence. We are thrilled to welcome these brands to our latest project and are committed to supporting them for the long term.”

    List of brands:

    Aeronautica Militare
    Balmain
    Bank of China
    Belstaff
    Boss
    Bottega Veneta
    Bulgari
    Cigar Emporium
    Coach
    Cosmos Food Station
    Din Tai Fung
    Dunhill
    Emporio Armani
    Fendi
    Girard-Perregaux
    Givenchy
    Glashutte Original
    Graff
    Gucci
    Hide Yamamoto
    Hublot
    ICBC
    Trattoria Il Mulino
    Image Digital
    IWC Schaffhausen
    Jaeger-LeCoultre
    Jaquet Droz
    kate spade new york
    Kenzo
    Longines
    McCafe
    McDonald’s
    MCM
    Michael Kors
    Montblanc
    Philipp Plein
    Piaget
    Prada
    Rainbow
    Rimowa
    Roberto Cavalli
    Saint Laurent Paris
    Shiki Hot Pot Restaurant
    Starbucks
    Tag Heuer
    T Galleria Beauty by DFS
    Tiffany & Co.
    Tom Ford
    UM
    Vacheron Constantin
    Valentino
    Van Cleef & Arpels
    Versace Collection
    Ermenegildo Zegna
    Zenith

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  • Telent to open Malaysia stores

    Telent to open Malaysia stores

    Chinese outdoor apparel brand Telent says it plans to set up retail points of sale in Malaysia as a first step in a broader Southeast Asian push.

    Telent specialises in the design, manufacture, marketing, brand management and distribution of branded outdoor apparel, footwear and equipment. It is China’s second largest outdoor wear brand measured by retail sales value.

    Telent is undertaking an IPO in Malaysia, issuing 103.39 million new shares at ten US cents each.

    The first new store will open in Kuala Lumpur with other Southeast Asian stores will follow as early as the third quarter of this year, in part funded with the funds raised in the IPO

    Telent Group executive director Hui Tang Tat says the product sales mix percentage in outdoor apparel and outdoor footwear respectively posted 43.8 per cent and 49.5 per cent sales growth last year, while equipment products grew by a more modest 6.7 per cent.

    As of October, Telent had 817 retail points of sale and 23 network distributors across China.

    “The Malaysian market is competitive and building our presence there will offer us a platform and opportunity to expand in this region,” Hui said during a media conference.

    “Perhaps in the next five to 10 years, we can go down the road to tap other Asian markets as we want our brand to be globally recognised,” he said.

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  • China Fordoo boosts store network

    China Fordoo boosts store network

    China Fordoo Holdings opened 42 new stores in the first half of this year, helping it boost sales in a soft Mainland retail market.

    Fordoo, a specialist menswear designer, manufacturer and retailer, now has 1494 stores across the Mainland, including two self-managed. Trousers account for 58 per cent of its revenue.

    For the six months to June 30, group profit was about RMB136.9 million (US$21.4 million), up 6.4 per cent on the same period last year. Sales increased by 8.1 per cent to RMB828.4 million ($129.56 million).

    “The increase was mainly due to the expansion of the group’s distribution network and the enhancement of its brand recognition,” the company said in its statement.

    Fordoo said in the first half, China’s economy had entered into a “New Normal” phase.

    “The economy has shifted from high growth to medium-to-high growth, and the economic structure has improved and been upgraded. Under the “New Normal” phase, the economy is increasingly driven by innovation rather than input and investment.”

    Apparel retail growth slowed. Total retail sales of garments, hats, footwear and knitwear in China recorded a 8.3 per cent year on year increase which was 0.4 percentage points lower than that of the corresponding period in 2014.

    “The overall retail market in China remained weak and consumer sentiment showed no sign of notable recovery. However, we are glad that China Fordoo Holdings was able to continue to grow at a stable and moderate pace during the period in terms of number of retail outlets, distributors and revenue.”

  • Corrupt Chinese supermarket exec jailed

    Corrupt Chinese supermarket exec jailed

    The former chairman of China’s Bright Food Group has been found guilty of embezzling US$31 million between 2000 and 2006 when he was chairman of Shanghai Lianhua Supermarket Holdings Ltd.

    Corrupt Chinese businessman Wang Zongnan was sentenced by the People’s Court in Shanghai on Tuesday to 18 years in prison for embezzlement and accepting bribes.

    According to the court hearing, Zongnan had accepted 2.69 million yuan in bribes, hiding the money through the purchase of two villas.

    In 2003, Wang’s parents bought two villas in Shanghai for 2.08 million yuan, 2.69 million yuan below the market price. The sellers were associated to a subsidiary of a company that had owed Wang a favor, according to the verdict. Wang sold the two villas in 2010 and 2013 for 14.8 million yuan in total.

    In the ruling, the court ordered that 1 million yuan of Wang’s personal property be confiscated and more than 12 million yuan in bribes and illegal earnings be returned.

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  • The Children’s Place lands in India

    The Children’s Place lands in India

    US retailer The Children’s Place has opened its first store in India.

    The brand has entered the market in partnership with Arvind Lifestyle Brands, opening its first store in Bengaluru.

    The Children’s Place operates about 1200 stores internationally and Arvind Lifestyle hopes to open up to 40 in India during the next four years, largely located in Delhi, Mumbai, Bengaluru, Hyderabad and Chennai.

    Arvind Lifestyle CEO J. Suresh said the children’s clothes and accessories market is dominated by the ‘unorganised” retailers and his company sees a significant opportunity to gain first to market advantage in the category.

    “We should hopefully be the leading player in the market,” said Suresh.

    Mridumesh Kumar Rai, who heads The Children’s Place business in India added: “We want to be for kids wear what Zara and Mango are for women’s fast fashion in India,” said.

    Arvind Lifestyle sells a broad range of franchised lifestyle brands including Gap, Nautica, Ralph Lauren, US Polo and Elle. Earlier this year it announced a partnership with US teen fast fashion brand Aeropostale.

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  • Profit falls as QKL Stores buys market share

    Profit falls as QKL Stores buys market share

    QKL Stores  a regional supermarket chain in Northeastern China and Inner Mongolia, has announced improved sales, but lower profit in the second quarter.

    Zhuangyi Wang, chairman and CEO, said the company had boosted its promotional activities in existing stores to strengthen its competitive position.

    Second quarter sales rose 9.2 per cent to US$56.4 million and gross profit decreased 4.3 per cent to $9.1 million.

    “The decrease in gross profit relative to net sales was due to competitions arising from the increasing challenge from the online shopping that have significant pricing pressure on our selling of high margin products.”

    Wang said QKL plans to slow down the pace of its new store openings this year.

    “Currently, we expect to open two new supermarket stores this year. We maintain confidence in our strategy of strengthening our store presence in Tier 4 and 5 cities in northeastern China as well as in our core region of operation around Daqing where the majority of our older stores are based.”

    Based in Daqing, QKL Stores sells a broad selection of merchandise, including groceries, fresh food, and non-food items, through its 40-odd retail supermarkets, hypermarkets and department stores; the company also has its own distribution centers that service its supermarkets.

    “As QKL expands its market presence in northeast China, we are uniquely positioned against our local competitors through our large product offering, strong supplier relationships, efficient distribution network and state-of-the-art IT system,” said Wang.

    “We are comfortable with our opportunities in the second half of the year and believe we’ll see an improvement in operating expenses and net result from the current quarter.”

  • China’s Jollychic.com branches into homewares

    China’s Jollychic.com branches into homewares

    Chinese eCommerce company Jollychic.com, an online global fashion destination, has unveiled a new line of homeware products called J.Home.

    “Increasing demand and lower prices have made Jollychic’s promotional furniture products a viable alternative for clients all around the world, according to Siwei Ma, furniture manager at JollyChic.com.

    “The growing public awareness about global eCommerce and other major advantages of the internet enables our customers to shop for more than 6000 products from different categories, including home decor, bed & bath, dining and pet care.”

    Jollychic.com is a global fashion destination, selling fast fashion and publishing a wide variety of fashion-related content, positioning the website as a growing fashion community. We sell over 50,000 branded and own-brand products through localized mobile and web experiences, delivering from our fulfillment centers in China to almost every country in the world. It runs sites in nine languages: English, French, Spanish, Arabic, Polish and Chinese.

    With the expansion into homewares, shoppers can take advantage of a free interior design consultation with dedicated customer service. An expanded customer loyalty program has been expanded to include a free gift offer that includes mugs and more.

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  • Air India to start evening Surat-Delhi flight from Oct 1

    Air India to start evening Surat-Delhi flight from Oct 1

    This year’s Diwali is set to usher in loads of surprises for the high-flying Surtis.

    Air India is preparing to introduce daily evening flight between Delhi and Surat by deploying the 168-seater Airbus-320 from October 1.

    This will be over and above the existing morning flight to Delhi. Hence, the Diamond City will have two daily flights to the national capital and same day return option will be available to business flyers at both ends. International connections to the USA, Europe and South East Asia will also be offered.

    By the end of October, Air India plans morning flight between Mumbai and Surat in its ATR aircraft.

    Thanks to the efforts of Surat and Navsari MPs — Darshana Jardosh and CR Paatil — frequent fliers from the Diamond City will get an opportunity to fly to Mumbai and Delhi after a break of more than 11 months.

    He added, “We also met Air Asia CEO Mittu Chandaliya who has agreed to introduce daily flights between Bangalore, Jaipur, Delhi and Surat this winter session.”

    Despite being the second largest city in the state, ninth in India and fourth fastest growing city in the world, Surat is very unfortunate in getting domestic as well as international air connectivity.

    Jardosh said, “We have been successful in convincing Air India authorities on introducing evening Delhi flight from Surat. We also met Prime Minister Narendra Modi in August and he instructed Air India CMD to take positive action. We are grateful to AirAsia CEO Chandaliya who is keen on starting flight operations from Surat.”

    Airport director Pramod Thakre said, “The DGCA will be sending the slot schedule of Air India’s evening flight to and fro from Delhi. The evening slot is open for smooth operation at the airport.”

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  • AirAsia bags gold at Putra Brand Awards 2015 for 6th consecutive year

    AirAsia bags gold at Putra Brand Awards 2015 for 6th consecutive year

    AirAsia Bhd emerged the gold recipient for the “Transportation, Travel & Tourism” category for the sixth consecutive year at the Putra Brand Awards 2015.

    The award was given to AirAsia for the airline’s continued presence as the country and the region’s leading and largest low-cost carrier.

    Elated at having bagged the award, chief executive officer Aireen Omar said AirAsia was committed to further grow its route network as the airline moves from being just a low-cost carrier to a value-carrier.

    The Putra Brand Awards was launched in 2010 by the Association of Accredited Advertising Agents Malaysia to recognise brand building as an integral business investment.

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  • 11street Identifies Evolution in Malaysian Online Shopping Trends

    11street Identifies Evolution in Malaysian Online Shopping Trends

    11street (www.11street.my), one of the largest online marketplaces in Malaysia, today showcases its Online Shopping Index, which identified the latest changes in online shopping behaviours of local consumers, as well as specific e-commerce insights during the four-week Ramadhan and Raya period from 22 June to 19 July

    In addition, online marketplace 11street shares that its gross merchandise value (GMV) has surged significantly because of the Raya shopping season. The company has also celebrated notable milestones, one of which is achieving a rank of 40 on Alexa[1] within months since its launch in April this year.

    Hoseok Kim, CEO of 11street says that based on the 11street Online Shopping Index, the market is expecting to see online shopping trends evolving for both men and women in addition to a rapidly growing use of mobile in the future.

    “Malaysia is one of the top leading countries in the world when it comes to smartphone Internet access with the number of connected devices per person used by Malaysians which stood at 1.2 devices. As online shopping becomes part of the Malaysian lifestyle, smartphones will play a vital role in enabling shoppers to grab good products and offers online at anytime, anywhere,” Kim adds.

    Key findings of the 11street Online Shopping Index include the following:-

    More Diverse Online Purchase

    Contradicting to the popular belief that Fashion and Electronics are the most sought after categories, Malaysians shop in diverse categories including Health & Beauty, Kids & Baby, Home & Living, Grocery, Services such as e-vouchers and many more. Also, according to the index, popular items that customers mostly searched during Ramadhan include baby car seats, Tupperware, Bluetooth earphone, and skincare.

    Furthermore, the 11street Online Shopping Index uncovers that customers actually bought from either two or more product categories within a single transaction and it is expected to increase over the next few years.

    Online Shopping is No Longer Just for Women

    The data shows that women are no longer the only gender that drives purchasing trends when it comes to online shopping, whereby 11street shoppers are a healthy ratio of 48 men: 52 women.

    For women, they mostly purchased mobile, tablets, beauty, health and personal products as well as baby and kids items. The changing trends revealed that men shopped online just as much as women. During Ramadhan, their interests lie not only in Electronics, Sports and Leisure items, but also for Kids & Baby items especially baby gears such as baby car seats for their children’s comfort and safety. This also shows that both men and women prioritize their children when travelling during the festive season, which is a positive sign of rising awareness on child passenger safety across the country.

    Mobile is the Future of E-commerce

    There is a progressive move towards mobile as more consumers are becoming connected, and businesses are adopting an omni-channel approach and as a result, spurs positive growth in Malaysia’s e-commerce market.

    According to the index, at least 40 percent of the shoppers are using their mobile devices to shop at 11street. Moreover, during Ramadhan, peak shopping hours began from the breaking fast period until midnight.

    Business Overview and Moving forward

    11street has grown tremendously in Malaysia and received overwhelming response from both local customers and sellers since its inception. Besides its achievement on Alexa rank, it currently carries more than 700,000 products making it one of the largest online marketplaces in Malaysia.

    Kim attributed the growing popularity of 11street to its ability of providing a convenient and enjoyable shopping experience and attractive product offerings at affordable prices. This is especially true for their much highlighted ‘SHOCKING DEALS’, which guarantee shoppers that if they can locate the same product selling at a cheaper price in another online shopping site, 11street will refund them with the price difference of the product at 110%. It is possibly the first of its kind deal in the local online retail market.

    Moving forward, 11street will be developing a combined strategy with focus to continue boost its product variety and price competitiveness while focusing on mobile shopping.

    “With the latest Malaysian online shopping insights in mind, we are committed to support the vital needs of sellers and online shoppers by building a stronger platform, and to enable customers to find what they love at 11street,” ends Kim.

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  • JCB and Bank BRI Sign for a New Partnership

    JCB and Bank BRI Sign for a New Partnership

    PT JCB International Indonesia, subsidiary of JCB International Co. Ltd. the international operations arm of JCB Co. Ltd., and PT. Bank Rakyat Indonesia (Persero) Tbk (“BRI”), one of the Indonesia’s largest state owned commercial banks, with specialties in small medium enterprise or small scale & microfinance, are pleased to announce a new partnership for card payment business. This partnership starts from the acceptance of JCB cards at BRI’s acceptance locations, and payment card issuing with JCB brand is also in scope.

    BRI is expanding its consumer business and celebrated the opening of its new branch in Singapore along with the signing ceremony with JCB on 21 August 2015, taking place in front of government official and business owners. Also in attendance were Mr. Asmawi Syam as President Director and Mr A. Toni Soetirto as Managing Director of Bank BRI, as well as Mr. Kimihisa Imada as Deputy President of JCB International Co. Ltd.

    BRI owns a large card acceptance network with over 21,215 ATMs and more than 153,786 EDC terminals (merchants) spread all over Indonesia as of the end of June 2015, and plans to grow a minimum of 85,000 EDC each year. BRI also wants to grow its credit card issuing business a minimum of 25% for issuing model over the 841,000 cards from last year with their unique selling proposition.

    The first phase of the partnership, enabling JCB cards, whose number exceeded 89 million, to be accepted at all of BRI’s 175,001 ATMs and EDC terminals. For ATM acceptance this phase has been in progress since early 2015, while for EDC acceptance, it expected to be launched by the end of this year, followed by phase 2, JCB credit card issuing, which is now being discussed and targeted for 2016.

    Managing Director BRI, A. Toni Soetirto said, “We believe that this partnership would bring a wider network of card acceptance in all of ATMs and EDCs network of Bank BRI throughout Indonesia.”

    Deputy President of JCB International, Kimihisa Imada said, “We are pleased that BRI, as one of the largest commercial banks in Indonesia in term of networks and coverage, has become our partner. This partnership will considerably improve convenience of JCB card usage across Indonesia by adding more than 153,786 acceptance locations. BRI’s broad nationwide network can fulfill the need of local JCB card members who reside in Indonesia as well as those who travel from outside Indonesia, especially in the travel spots and tourist destinations. I am looking forward to extending this partnership to issuing JCB card, whose strength is the quality of service based on the expertise we have gained from experiences providing to customers in Japan for over 50 years. I am sure that the new card product with both reputable brand names will bring new value to the market.”

    About JCB

    JCB is a major global payment brand and a leading credit card issuer and acquirer in Japan. JCB launched its card business in Japan in 1961 and began expanding worldwide in 1981. Its acceptance network includes about 29 million merchants and over a million cash advance locations in 190 countries and territories. JCB cards are now issued in 19 countries and territories, with more than 89 million card members. As part of its international growth strategy, JCB has formed alliances with more than 350 leading banks and financial institutions globally to increase merchant coverage and card member base. As a comprehensive payment solution provider, JCB commits to provide responsive and high-quality service and products to all customers worldwide.

    Note: JCB statistics included in About JCB are as of the end of March 2015. For more information, visit: www.jcbcorporate.com/english

    About Bank Rakyat Indonesia

    Bank Rakyat Indonesia (Bank BRI) was established on December 16, 1895, which marks BRI’s anniversary ever since. Since August 1, 1992, under the Banking Law No. 7 year 1992 and Regulation of the Government of the Republic of Indonesia No. 21 year 1992, Bank BRI’s status has changed into a limited liabilities company. At that time, Bank BRI’s ownership was still in the hand of the Government of the Republic of Indonesia for 100%. In 2003, the Indonesian Government decided to sell 30% of the bank’s shares, marking BRI a public company under the official name of PT. Bank Rakyat Indonesia (Persero) Tbk., which is still used until now.

    Bank BRI is one of Indonesia’s state owned bank with a consistent focus on SMEs business. With more than 10,551 offices including mobile services (e-BUZZ, Teras Keliling and the newly launched Teras Kapal), supported by over 21,215 ATMs and more than 153,786 EDCs (merchant and BRILink), Bank BRI is the largest Bank with the widest network in Indonesia.

    In order to constantly provide the best services to customers and to be the frontrunner in creating financial inclusion by focusing on supporting SMEs business reach all over Indonesia, on 28th April of 2014, Bank BRI signed a contract to purchase and launch a fully owned satellite called BRIsat. Targeted to orbit on 2016, the purchase of BRIsat has made Bank BRI the first and only Bank in the world to own and operate its own satellite.

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  • Axiata to restructure Indonesia unit’s loan

    Axiata to restructure Indonesia unit’s loan

    Mobile operator Axiata Group Bhd, which reported a 34% jump in net profit to RM610.7mil in its second quarter ended June 30, is planning to restructure a US$590mil loan taken by its Indonesian unit into local currency-denominated partial sukuk.

    The move, its chief financial officer Chari TVT said, would help the group manage its foreign exchange (forex) exposure, as the volatility in the currency market rises.

    Apart from Indonesia, group borrowings include a US$134mil debt at its operation in Sri Lanka under Dialog Axiata PLC and US$100mil in Robi Axiata Ltd.

    “We also have an exposure of US$590mil, which is unhedged, in PT XL Axiata Tbk, so the total amount of exposure is about US$823mil, inclusive of Dialog and Robi,” he told reporters at a press conference yesterday.

    For operations in Malaysia, Chari said the group had borrowed some RM5bil, but there was no forex exposure as far as Malaysia was concerned.

    He said this after the mobile operator’s net profit jumped 34.2% to RM610.7mil in the second quarter from RM455mil a year ago, mainly due to lower losses from Indonesia arising from lower forex losses and net finance costs.

    Hong Leong Investment Bank Research said on a turnover of 11.1 trillion rupiah, XL had recorded a core net profit of 84 billion rupiah, accounting for 40% of the consensus estimate of 209.9 billion rupiah.

    The research house noted that XL’s transformation strategy was fruitful and was beginning to show early promising signs and results. “This is evident from several positive leading indicators, including a materially improving subscriber mix, rising reloads per sub, joiner average-revenue-per-user significantly higher than churners’ and an increased share of modern distribution versus traditional,” it said in a note.

    Chief executive officer Datuk Seri Jamaludin Ibrahim said XL’s transformation strategy was on track, as it saw a positive quarterly revenue from the group and plans to strengthen XL’s balance sheet to reduce its dollar exposure.

    Higher profits were also recorded by the Sri Lankan and Cambodian operations, and the share of profits from its associate company in India increased significantly.

    Revenue, however, was marginally lower at RM4.7bil compared with RM4.73bil previously due to lower revenues in Malaysia and Indonesia.

    Chari said the group planned to keep its capital expenditure within the RM4.8bil level this year, but will be more cautious next year, as the ringgit is expected to remain volatile.

    Meanwhile, Jamaludin said the group was reconsidering its listing plans for its Bangladeshi unit.

    “It was true that we had wanted to list out Bangladeshi unit. But that was before they came out with a new rule saying that we did not have to.

    “So, the current status is that we are re-evaluating whether we want the initial public offering or not. There are pros and cons,” he said.

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