Archilles (Multistrada Arah Sarana, Tbk)
A. company profile
PT Multistrada Arah Sarana Tbk (MASA) was established on June 20th, 1988 under the name of PT Oroban Perkasa. It is engaged in manufacturing Passenger Car Radial (PCR) tires and Motor Cycle (MC) tires for export and domestic market. MASA has markets its product with brand name of “Corsa”, “Strada” and “Achilles”.
What happend to MASA..
* Global Crisis not to Affect MASA’s Sales (2009)
In 9M09, MASA successfully raised its sales 19.2% YoY to Rp 1.2 tn. Its car tire production volume increased from 3.24 mn units in 9M08 to 3.51 mn units in 9M09, growing 8.29% YoY. In addition, MASA’s production volume of motorcycle tires ...view middle of the document...
MASA also intensifies its sales to other areas such as Asia, Africa and Middle East area in order to overcome the possibility of weakening demand from the European and American countries.
* Capacity Expansion For Higher Sales Volume (2011)
MASA has completed its expansion project to increase production capacity to 28,500 unit/day PCR tires and 16,000 unit/day MC tires in 2011. However, MASA will gradually continue in escalating the production capacity of PCR’s tire to 35,000 units per day in 2013.
With such expansion that MASA had, estimates that production volume will increase by 9%
* Improved Financial Strength in 2012 through Proceeds of Rights Issue (2012)
MASA conducted a limited public offering II by issuing pre-emptive right for 3,060,982,315 new shares offered at Rp 500 per share at the end of 2011. The corporate action generated fund of Rp 1.5 trillion in total, which will be used for settle some of MASA’s loan, acquire machines, equipments and supported building, and also for working capital.
* Unfavourable Abroad, Flourishing at Home (2012)
MASA’s export performance deteriorated in 2012, with exports down 6% after a period of strong growth (30% on average for 2006-2011). The damage stemmed from Europe, where its sales fell by 59%, wiping out its better performance from other export destinations.
( The causes ) : MASA put a lot off its attension and effort to gain European market.
MASA will shift its focus from Europe to more promising regions like Africa, Australia and other Asian countries, and attempt to strengthen its domestic presence.
* Higher Capacity to Meet Export and Domestic Demand
Despite a 20%-30% year-on-year (YoY) fall in the average rubber price in 2012, MASA’s gross margin did not improve like other tire producers, falling from from 16.6% in 2011 to 14.9% in 2012.
Action : Company try to increase their sales by giving discount
In addition, to penetrate more their domestic market, MASA spend aggressive Advertising & Promotion cost. It has opened new stores, sponsored the international Formula Drift event, and partnered one of the world’s largest football clubs, Manchester United. As a result, it booked a substantially lower operating margin than in previous years, at 1.4% for 2012 from 5.3% in 2011.
SWOT analysis ( for 2014 )
* Well known brand in Indonesia
* Wide distribution channel
* Distributor-Friendly marketing scheme
* Competitive selling price
* High productivity
* Availability of financial support to expand its production capacity
* MASA’s Product simillar to consumer
* Very sensitive to global macro situation\
* Increasing sales of car and motorcycle
* Availability of rubber supply in Indonesia
* High population around world including indonesia
* Lack of tires supply VS demand
* Increase in the world rubber price
* Supply of china product with low price