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T Bakrie Sumatra Plantation (UNSP) says it expects to generate Rp 7 trillion (US$742 million) in revenue this year, a potential 60 percent increase over last year, on the back of its oleochemical business.

Newly appointed president director Bambang Aria Wisena said on Thursday in Jakarta that out of the total sales target, around Rp 3 trillion, or 42.86 percent, was expected from sales of oleochemical products, such as fatty acids, to meet demands from emerging markets, particularly China and India.

The oleochemicals generated Rp 449.37 billion in sales for the firm in 2011, the first year of commercial operations for its fatty acid plant in Tanjung Morawa, North Sumatra, which has a production capacity of 160 tons a day.

Bambang said that a larger contribution from olechemicals would be driven by additional output from the first lines of its fatty acid and fatty alcohol plants in Kuala Tanjung, North Sumatra, which were slated to commence operation in the third quarter. The plants were designed to produce 300 tons of fatty acid and 100 tons of fatty alcohols per day.

In addition to rising sales volume for oleochemicals, the firm expects to benefit from higher prices for palm-oil processed products, Bambang said without elaborating.

The firm has earmarked US$40 million in capital expenditures for expansion this year, half of which would be channeled to develop the new plants, according to Bambang.

The firm is building second lines at its fatty acid and fatty alcohol plants and a palm oil refinery plant in Kuala Tanjung, along with a palm oil refinery plant and a kernel crushing plant.

UNSP currently runs oil palm plantations totaling 92,200 hectares in North Sumatra, West Sumatra, Riau, Jambi, South Sumatra, Central Kalimantan and South Kalimantan, and rubber plantations totaling 18,921 hectares. It also operates eight palm oil mills and four natural rubber processing factories in the areas near its existing plantations.

Last year, its palm oil business booked Rp 2.79 billion in sales, up 36.28 percent from last year, while its rubber business recorded Rp 1.23 billion in sales, up 29.52 percent from a year earlier. Total sales reached Rp 4.37 trillion, up 48.56 percent from 2010, while net profits were Rp 745.5 billion in net profit last year, down by 7.81 percent from a year earlier.

A shareholders meeting approved the disbursement of Rp 62.5 billion, representing 8.38 percent of last year’s net profits, as dividends to shareholders on Aug. 29. It also approved Bambang, who was one of the firm’s directors, as president director to replace Ambono Janurianto, who now chairs PT Bakrieland Development, and Anindya Novyan Bakrie as the firm’s commissioner.

UNSP is currently 26.38 percent owned by BNBR after the latter, which once maintained a controlling stake, released part of its shares in a Rp 42.96 billion sell-off transaction earlier this year.