Implementation of 100% DHE SDA Policy and Its Impact on Indonesia's Coal Industry - Titan Infra Sejahtera

The Indonesian government, under the leadership of President Prabowo Subianto, has officially implemented the 100% Devisa Hasil Ekspor Sumber Daya Alam (DHE SDA) policy, This policy requires all exporters in the mining, plantation, forestry, and fisheries sectors to place 100% of their export proceeds into a special account in a national bank for 12 months. This move aims to increase the country's foreign exchange reserves, which are predicted to grow by up to 80 billion USD or IDR 1,300 trillion.

The Governor of Bank Indonesia has welcomed this policy, as it can enhance economic stability and strengthen the rupiah exchange rate. However, for mining companies, particularly those in the coal sector, this policy has significant implications for their financial structure and export operations.

Indonesia’s Coal Potential and Infrastructure Challenges

Indonesia is one of the largest coal reserve holders in the world. One of its biggest coal-producing regions is South Sumatra, which contributes around 15% of the national coal production. Despite its vast potential, this sector still faces numerous challenges, especially in infrastructure and logistics.

Some of the main obstacles in Indonesia's coal industry include:

• Limited transportation infrastructure – The distribution of coal from mines to export ports is hampered by inadequate road and railway infrastructure.
• High logistics costs – Poor road access increases overall transportation and logistics costs.
• Limited port capacity – The lack of proper port facilities slows down exports to international markets.

To address these challenges, various energy infrastructure companies have emerged to support the smooth distribution of coal to global markets. One key player in coal logistics is PT Titan Infra Sejahtera.

PT Titan Infra Sejahtera: A Key Player in Coal Logistics Infrastructure

PT Titan Infra Sejahtera (TIS) is part of the Titan Infra Energy Group, providing integrated infrastructure solutions to support the mining industry, particularly in South Sumatra. The company focuses on improving transportation and coal shipment efficiency through modern infrastructure.

PT Titan Infra Sejahtera’s Structure and Services

PT Titan Infra Sejahtera operates through two key subsidiaries that play crucial roles in its logistics operations:

• PT Servo Lintas Raya (SLR) – Manages dedicated coal mining roads, allowing faster and more efficient coal transportation.
• PT Swarnadwipa Dermaga Jaya (SDJ) – Provides coal export port services, ensuring smoother shipments at lower costs.

With a combination of dedicated mining roads and modern port facilities, PT Titan Infra Sejahtera accelerates delivery times and improves logistics efficiency for coal mining companies.

Expansion Strategy and 2025 IPO Plan

As part of its expansion strategy, PT Titan Infra Sejahtera plans to conduct an Initial Public Offering (IPO) in 2025, offering 10% of its shares on the Indonesia Stock Exchange (IDX). This initiative aims to raise additional capital to expand infrastructure and improve port and logistics capacity.

According to Suryo Suwignjo, the Director of Operations at PT Titan Infra Energy, the IPO proceeds will be allocated to several strategic projects, including:

• Building new ports to increase coal export capacity.
• Expanding logistics routes to accommodate rising coal transportation volumes.
• Developing renewable energy infrastructure as part of business diversification.

This IPO decision is backed by the company's strong financial performance, with an EBITDA of USD 100 million in the previous year. This demonstrates PT Titan Infra Sejahtera’s promising business prospects amid sustained global demand for coal.

Partnership with PT Bukit Asam Tbk. and Growth Potential

Since 2024, PT Bukit Asam Tbk. (PTBA), one of Indonesia's largest coal producers, has been utilizing PT Titan Infra Sejahtera’s roads and ports for coal transportation. This partnership benefits both parties:

PT Bukit Asam reduces logistics costs and accelerates coal shipments to export markets.

PT Titan Infra Sejahtera gains additional revenue from infrastructure and logistics services.

With global coal prices stabilizing at around USD 125 per ton, PT Titan Infra Sejahtera’s business outlook remains bright. To anticipate increasing transportation volumes, the company has expanded its port facilities from two to three and increased conveyor numbers from five to six in the coming years.

Impact of 100% DHE SDA Policy on the Coal Industry

While the 100% DHE SDA policy aims to strengthen the country's foreign exchange reserves, its implementation has had varying effects on the coal industry. Some key impacts include:

• Pressure on corporate cash flow – Export proceeds must be stored in national banks for 12 months, limiting company liquidity.
• Potential reduction in exports – If the policy restricts liquidity access, companies may face difficulties expanding exports.
• Increased operational costs – Limited flexibility in utilizing export revenues may lead to rising operational expenses.

To mitigate these challenges, coal companies like PT Titan Infra Sejahtera must adopt adaptive strategies such as diversifying revenue streams, optimizing operational efficiency, and enhancing infrastructure to remain competitive in the global market.

Indonesia's coal industry holds great potential, particularly with abundant reserves in regions like South Sumatra. However, infrastructure challenges and new policies such as the 100% DHE SDA policy present significant hurdles for industry players.

As a leading energy infrastructure company, PT Titan Infra Sejahtera plays a crucial role in ensuring smooth coal distribution through dedicated mining roads and modern export ports. With its 2025 IPO plan, strategic partnerships with PT Bukit Asam, and aggressive expansion initiatives, the company is well-positioned to strengthen its presence in Indonesia’s coal industry.