A “conglomerate” refers to a group of affiliated companies that hold a large share in a particular market. In Japan, conglomerates were dismantled in 1945, but companies that inherited the businesses of former conglomerates—such as Mitsubishi, Mitsui, and Sumitomo—continue to wield significant influence.

Meanwhile, conglomerates still exist in Indonesia today, with over 30 of them in operation. Their business domains span a wide range, including agriculture and forestry, automotive, retail, IT, and energy. For Japanese companies considering market entry into Indonesia, understanding these conglomerates is essential.

This article introduces seven of the most prominent Indonesian conglomerates.

Structure of Conglomerates in Indonesia

In Indonesia, indigenous people of Malay descent are referred to as pribumi, while those who immigrated from overseas are distinguished as non-pribumi.

Many of Indonesia’s conglomerates were founded by non-pribumi, and the vast majority of these founders are of Chinese descent (Tionghoa or overseas Chinese). Although ethnic Chinese make up only about 3% of Indonesia’s population, they have achieved remarkable success in business, and it is no exaggeration to say that they exert significant influence on the Indonesian economy.

For more information about the Chinese-Indonesian community, please refer to the article below.

Representative Conglomerates in Indonesia (1)

Salim Group

The Salim Group is a conglomerate engaged in a broad range of businesses including retail, food, telecommunications, automotive, IT, and agriculture. It was founded by Sudono Salim, an ethnic Chinese entrepreneur. As of June 2023, his third son, Anthoni Salim, serves as Chairman.

In the 1950s, founder Sudono Salim deepened his relationship with then-military commander and future President Soeharto by supplying goods to the military, which led to the success of his business ventures. Although the group nearly collapsed during the Asian financial crisis, it was rebuilt under the leadership of his son Anthoni Salim and has continued to thrive to this day.

Companies under the group’s umbrella include Indofood, the globally renowned manufacturer of instant noodles under the Indomie brand; Indomaret, a major convenience store chain; and Indomobil Group, one of Indonesia’s largest automobile manufacturers, which has joint ventures with Japanese companies such as Suzuki and Hino Motors.

Recently, the group has actively expanded into cutting-edge technology and trend-driven ventures, including the development of metaverse platforms and the release of the Indonesian version of Pokémon cards.

Reference: Indofood

Astra International

Astra International is a conglomerate primarily focused on the automotive sector. It was founded in 1957 by William Soeryadjaya, an ethnic Chinese entrepreneur. In Indonesia’s automotive market—largely dominated by Japanese manufacturers—the company has established a strong position through partnerships with Toyota, Daihatsu, and Honda.

Originally launched as a trading company by William Soeryadjaya and fellow Chinese-Indonesian associates, the business faced a major crisis when his eldest son, Edward Soeryadjaya, failed in banking ventures, forcing the family to relinquish 76% of their shares at one point. Nevertheless, the company expanded by aligning with Japanese automakers and has since diversified into finance, agriculture, heavy equipment, logistics, and other fields.

A recent major development includes the launch of an online platform for buying and selling used cars. By offering a simple, safe, and transparent service, the company aims to reshape trends in Indonesia’s automotive sales industry.

In addition, Astra has been actively investing in digital fields, such as e-commerce for food products and telemedicine startups.

References:

1. Astra International
2. CNBC INDONESIA: Kisah Pendiri Astra yang Tak Pernah ‘Manjakan’ Penguasa
3. Nikkei Asia: Astra, Automotive Giant in Indonesia, Expands into Smartphone Payments and Healthcare

Sinar Mas Group

Sinar Mas Group was founded by Eka Tjipta Widjaja, an ethnic Chinese entrepreneur who came from a poor family. He faced numerous challenges in his entrepreneurial journey, including a lack of fluency in the Indonesian language and weak domestic networks.

He distributed business responsibilities among his sons: the paper and pulp division went to his eldest son Teguh, the financial division to his third son Indra, and the real estate division to his fourth son Muktar. This family-centric management approach reflects the ethnic Chinese value of prioritizing familial bonds.

Group subsidiaries include Asia Pulp and Paper (APP), one of the largest paper companies in Asia, and Golden Agri Resources, which manages everything from palm cultivation to product sales.

In 2020, the group partnered with the Japan Overseas Infrastructure Investment Corporation for Transport & Urban Development (JOIN) to establish a joint venture in Singapore. This platform aims to promote infrastructure development in Indonesia and is expected to leverage Japan’s advanced technology in alignment with the country’s focus on infrastructure expansion.

References:

1. sinarmas
2. Mitsui: The Transformation of Indonesian Conglomerates—Focusing on the Third Generation of Founding Families
3. JOIN: Building a Platform for Overseas Infrastructure Project Formation

Representative Conglomerates in Indonesia (2)

Djarum Group

Djarum Group is a conglomerate that built its fortune through the production and sale of cigarettes under the Djarum brand. Today, its business portfolio has expanded to include real estate development, finance, and consumer electronics manufacturing and sales.

The group was founded by Oei Wie Gwan, an ethnic Chinese entrepreneur. It started as a small company with around 10 employees, but succeeded in differentiating itself from competitors through the superior taste of its cigarettes, earning a loyal fan base.

Djarum has had a significant global impact on the tobacco industry through innovations such as the world’s first low-tar cigarette and the development of kretek (clove-flavored) cigarettes with low nicotine content.

Following its success in tobacco, the group diversified into real estate, hospitality, and banking. Notably, it developed Grand Indonesia, a large shopping mall in Jakarta, and acquired management control over Bank Central Asia (BCA), one of Indonesia’s major privately-owned banks, which had once been nationalized.

Currently, Robert Budi Hartono, the founder’s son, serves as the CEO. Under his leadership, the group has strategically invested in promising ventures such as Gojek (a super app providing food delivery and ride-hailing services) and Halodoc (a telemedicine startup), demonstrating a keen eye for future-oriented business opportunities.

References:

1. DJARUM
2. Mitsui: The Transformation of Indonesian Conglomerates—Focusing on the Third Generation of Founding Families

Lippo Group

Lippo Group was founded by Mochtar Riady, beginning with the establishment of Lippo Bank in 1948. Over the years, the group launched several banks, including Buana Bank and Panin Bank, playing a key role in growing small-scale banks into major financial institutions and significantly reshaping Indonesia’s banking sector.

In addition to finance, the group has diversified into real estate development, IT, retail, and food services. Among its more familiar consumer-facing businesses are Matahari Department Store, a major department store chain, and Hypermart, a large supermarket chain.

Although the group originated in banking, its focus has shifted more toward real estate in recent years. One of its most notable achievements is the development of Lippo Village, a planned city located just west of Jakarta in Tangerang. This project attracted attention as a new model of urban development.

In 2019, Lippo Village entered a partnership with SoftBank to utilize AI and IoT in real estate and transportation ecosystems, aiming to further advance the city’s infrastructure and development.

References:

1. Lippo Group
2. Lippo Village
3. SoftBank: Lippo Karawaci and SoftBank Partner to Develop Advanced AI and IoT Solutions

Gudang Garam

A major rival of the previously mentioned Djarum Group, Gudang Garam is a leading cigarette company, especially renowned for its production of kretek—clove-flavored cigarettes—which have earned significant market share both domestically and internationally.

The company was founded by Surya Wonowidjojo, an ethnic Chinese entrepreneur. It is currently led by his son, Susio Wonowidjojo, who serves as CEO. In addition to its core tobacco business, the group has expanded into petrochemicals and food manufacturing.

One notable collaboration is its partnership with the Japanese confectionery company LOTTE, for which it manufactures and distributes products within Indonesia. The related factory is located in the MM2100 Industrial Town in Bekasi, West Java, a development led by Marubeni Corporation.

Although Gudang Garam is widely recognized for its tobacco products, it also operates oil palm plantations for palm oil production. The company entered the palm oil business in the 1990s, a sector that has grown rapidly in Indonesia since the 2000s. Currently, the palm oil operations are managed by Makin Group, a company established by Susio Wonowidjojo himself.

References:

1. Gudang Garam
2. CNBC INDONESIA: Raja Sawit RI: Gudang Garam Ternyata Tambah Kaya dari Sawit!

Barito Pacific

Barito Pacific is a conglomerate involved in petrochemicals, forestry, and plantation businesses. It is the only company in Indonesia that possesses a “naphtha cracker,” a comprehensive petrochemical facility that breaks down naphtha—refined from crude oil—into industrial petrochemical materials.

The company was founded in 1979 by Prajogo Pangestu, an ethnic Chinese entrepreneur. In 1993, Barito Pacific was listed on the Indonesia Stock Exchange. The group steadily expanded through major acquisitions, including Chandra Asri Petrochemical in 2007 and Tri Polyta, a polypropylene resin manufacturer, in 2008.

In 2021, the group recorded sales of approximately IDR 45 trillion (approx. USD 3.4 billion [based on IDR 13,000/USD conversion]), largely driven by strong performance from Chandra Asri Petrochemical and the geothermal power operations of Star Energy Geothermal.

Although its core strength lies in petrochemicals, Barito Pacific has also diversified into various other businesses, including constructing the Wisma Barito Pacific 2 office building and producing adhesives for particle board, a type of wood-based board.

References:

1. Barito Pacific
2. Voice Of Indonesia: Barito Pacific Owned by Conglomerate Prajogo Pangestu Earned IDR 45 Trillion in Revenue and IDR 1.56 Trillion in Profit in 2021

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Company Formation in Indonesia

Conglomerate Businesses: A Key Lens for Understanding Indonesia

When we think of conglomerate businesses, large-scale ventures such as transportation infrastructure and real estate development tend to come to mind. However, in reality, these groups are not limited to massive undertakings—they also invest in emerging technologies and cultivate small ventures into large enterprises.

With their financial power and sensitivity to market trends, conglomerates serve as important indicators of Indonesia’s future economic trajectory. For Japanese companies considering entry into the Indonesian market, monitoring the new business ventures of major conglomerates is highly recommended.

In addition to understanding the movements of Indonesian companies, conducting thorough market research is crucial when considering expansion into Indonesia. PT. TRICRUISE MARKETING INDONESIA conducts surveys involving 110,000 Indonesian respondents and offers post-survey consultations to support decision-making. These services are also useful for identifying the needs of Indonesian consumers, so please feel free to contact us if you are interested.