09 August 2018

KONTAN.CO.ID - JAKARTA. The Indonesian government is working on a regulation that requires the use of diesel mixed with 20% palm oil (B20). This policy will take effect on September 1, 2018.

This was done to cut oil imports, in order to reduce the current account deficit.

If this policy is realized, Indonesia's domestic CPO consumption will increase rapidly and can be a positive sentiment for issuers in the plantation sector.

Usli Sarsi, President Director of PT Mahkota Group Tbk ( MGRO ) said that the B20 policy that will be launched by the government could be a positive sentiment for his company.

“We welcome this government plan because this policy can increase public demand and increase domestic CPO prices,” he explained to kontan.co.id, Wednesday (8/8).

Usli also said the B20 policy will boost the use of biodiesel-based fuel for private vehicles, heavy equipment and public transportation.

“This will help increase the volume of diesel and biodiesel blending, thus stabilizing CPO prices,” he said.

He also said that this policy also has a good impact on the use of vegetable oil. “That way the amount of fossil fuel use will be reduced so as to reduce environmental pollution,” he added.

Usli is also optimistic that this policy will be able to boost MGRO's performance. “We are targeting revenue to reach IDR 2 trillion and net profit is expected to increase to IDR 50 billion by the end of this year. With a contribution of 2.5% of CPO production,” he added.

Source : http://investasi.kontan.co.id/news/mahkota-group-sambut-baik-kewajiban-penggunaan-b20