JAKARTA, investor.id - PT Sinergi Multi Lestarindo Tbk (SMLE) is venturing into the vape and tobacco industry as a distributor of flavor raw materials for vape liquid businesses and marketing oleoresin flavor raw materials in Indonesia. With this expansion, the company is optimistic about achieving a 50% revenue growth target.

Siu Min, the CEO of Sinergi Multi Lestarindo (SMLE), explained that the seriousness of this business expansion is demonstrated by the company's collaboration with one of the largest fragrance and flavor suppliers from Guangzhou, China, City Flower. City Flower is known for its innovation and advanced technology in producing high-quality products accepted at prices competitive with competitors.

Siu Min further stated that this would be supported by a technical support team capable of providing solutions for formulations made by SMLE. 

"With this expansion, the company is optimistic that the set sales targets can be achieved and even exceeded, considering that almost 90% of the samples provided to potential SMLE customers have been well-received in the Indonesian market," he said in a written statement on Sunday (3/3/2024).

Siu Min said that when listed on the stock exchange last January, the company targeted revenue growth of up to 50%. It will be achieved supported by the optimism of the vape user market in Indonesia, which continues to grow, thereby creating business opportunities for vape liquid producers.

Based on information from several sources, the vape industry in Indonesia generated revenue of around Rp. 5.6 trillion in 2023, representing a compound annual growth rate (CAGR) of 2.77% during the period 2023-2028.

This data provides significant growth opportunities for SMLE in 2024, as product trial implementations have been conducted by manufacturers since the third quarter of 2023, which can be applied this year. To facilitate smoother expansion, SMLE is also actively engaging with vape communities and manufacturers, including participating in various vape exhibitions in Jakarta.

"This step demonstrates SMLE's commitment to expanding the market and introducing flavor products to manufacturers," he said. 

Not only focusing solely on the vape industry, the company is also beginning to expand into the tobacco industry. The company has targeted approximately 720 tobacco processing industries in Indonesia as potential markets for marketing flavor raw materials and similar products like oleoresin, which can be mixed into tobacco products.

The Central Statistics Agency (BPS) recorded that the gross domestic product (GDP) based on constant prices (ADHK) of the tobacco processing or cigarette industry amounted to Rp 86.11 trillion in 2023. This value increased by 4.8% compared to the previous year, which was Rp 82.17 trillion.

"The hope is that in the next two years, revenue contributions from the flavor and oleoresin business can triple from the current level. To achieve this, broader product trials need to be conducted to be accepted by manufacturers," said Siu Min.

Siu Min hopes that the business expansion will proceed quickly as is happening in the vape industry. Moreover, SMLE continues to make various efforts to seek opportunities and pursue further expansions to maintain and even enhance performance in 2024.

"This is also a form of responsibility of the company to the stakeholders who have entrusted us because currently, SMLE's revenue comes from three specialty chemical segments or specialty chemical products for cosmetics, food and beverages, and industrial chemicals," concluded Siu Min.