By: Agustinus Gius Gala
Globe Asia-19. Agustus Benny Subianto proved his value at PT Astra International Tbk., where he was instrumental in founding both Astra Agro Lestari and United Tractors. Now out on his own with his investment fund, he says the best lesson in life is “never stop learning.”With close links to automotive giant astra International and a founder of two of the giant's highly successful business units, Benny Subianto is now focused on his own investment vehicle.
As president director of PT Persada Capital Investama (PCI) the 66-year-old entrepreneur has set his sites on natural resources and commodities in coal, palm oil, rubber and plywood. PCI was founded in 2003 as a holding company for PT Tri Nur Cakarwala and PT Pandu Alam Persada. Benny and his family own a 50% stake in each. He is also a founder of PT Astra Agro Lestari and PT United Tractor, both listed on the Indonesia Stock Exchange.PCI has expanded its oils and gas interests recently through Interra Indo Resources, which operates oil blocks in Indonesia and Myanmar. In tourism and property, PCI is engaged in Bali and owns a construction company, trading houses, healthcare and financial services.“The growth in our company is more prominent in the coal and plantation sector,” Benny told GlobeAsia.
Last year, total sales for companies under the PCI umbrella reached close to Rp20 trillion, with the largest contributor PT Adaro, the second biggest mining enterprise in Indonesia, with sales of $1.1 billion.PT Kirana Megatara, a rubber processing company with production capacity of 400,000 tons a year, reported $740 million in sales.“The most impressive investment that we made was when we bought 12.3% of shares In PT Adaro because the return rate is high,” says Benny, adding he was encouraged to invest by Edwin Soeryadjaya, the son of William Soeryadjaya, founder of PT Astra International.A father of three, Benny says he is pleased with PCI's investments and growth, most notably in PT Adaro, Kirana Megantara and Truputra Agro Persada.
However, he concedes that several companies have not reached their growth targets, including PT Sapta Indra Sejati (SIS), a coal sector contractor.“It's troublesome handling these small companies,” he says. “PT SIS is suffering because of delays in the supply of new heavy equipment.”Teddy P. Rachmat, owner of Triputra Group, is Benny's business partner and a former president director of PT Astra International. He was also Benny's junior at the Faculty of Engineering at the Institute of Technology in Bandung (ITB).
Benny and Teddy - a cousin of William Soeryadjaya have enjoyed a 35-year business relationshipand strong friendship. “Benny and Teddy are like brothers who grew and developed together at Astra,” says a company insider.
Cost pressure
While close friends, their investment policies have followed separate paths, with Benny choosing to focus on mining and plantations. He believes natural resources have a competitive advantage in Indonesia. “The most important issue is surviving among all the new players in the booming natural resources sectors. It's based on how to become the lowest cost producer,” he confides.And, he adds, “looking for a business partner is like finding a life partner. We have to have something in common.” Benny says many companies offer him investment funds, but as head of a professional investment company he channels responsibility to his team. “In the end I'm the one who makes decisions but we all have a job to do.”According to Benny, there are three factors in developing a successful investment company.
First, investing in a growing business sector with long-term and strong industry trends; second, solid team management; and finally capital expenditure. “We are now trying to be that kind of company. Our most successful investment is Adaro because of the high returns, along with the other coal-mining companies. But we also have had investment in ventures like Hotel Cipta, which has been sold to Siswono Yudohusodo.”Never stop learning is his tip to becoming a successful entrepreneur. Benny says he will never forget a speech by Vietnam's former president Ho Chi Minh delivered at ITB.“He said that at the moment you graduate with a bachelor's degree, that doesn't mean that you've finished your school, you've just begun your last school, which is the school of life.” Benny has big dreams for PCI.
He wants to be like Warren Buffet, one of the richest men in the world, worth $62 billion through his investment company Berkshire Hathaway. “Warren buys stock in world companies such as Coca-Cola, Wells Fargo, and Kraft Food through Berkshire Hathaway. I want to have many investments just like him. I want to develop Persada Capital Investama just like Berkshire Hathaway.” he says.
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