S

tate-run toll road operator Jasa Marga is looking to boost its non-toll road contribution to 20 percent in the next five years, and its property unit will be the main actor in achieving the goal, a top executive says.

Jasa Marga vice president for corporate planning Dedi Krisnawan told reporters over the weekend that the publicly listed company was looking to see its businesses outside toll roads contribute around 15 percent and 20 percent to its revenues in the next five years, from around 7 percent at present.

Of the targeted figure, around half will come from its property unit Jasamarga Properti, he said, with huge potential coming from strategic areas around the company'€™s toll roads.

'€œWe have seen how property developers can reap huge benefits from developing areas around toll roads and marketing their products'€™ accessibility, and we want to tap into the opportunities while maximizing our existing assets to generate additional income,'€ he explained.

'€œIt'€™s like killing two birds with one stone for us, because having more people live around our toll roads can help to boost traffic. We are planning to see our property unit generate Rp 1 trillion [US$75.12 million] in sales in around five years, and by then Jasa Marga'€™s total revenue will be around Rp 13 trillion, according to our current planning,'€ Dedi went on.

As of the first quarter, Jasamarga Properti, which was established in 2013, produced around Rp 11.43 billion in revenue, compared to Rp 1.7 billion in the same period in 2014.

Dedi added that Jasa Marga expected its property unit to be ready to go public within the next five years, adding that for now the unit would focus on land banking in preparation for its future initial public offering (IPO).

He said his company currently had around 18 hectares of land in Greater Jakarta and Sidoarjo, East Java, and was looking to boost this figure to 60 hectares in five years.

For this year alone, the company had earmarked around Rp 150 billion to secure more land.

'€œWe are targeting locations around tollgates,'€ he said.

The company is looking to develop a mixed-use project in Ciledug, near an exit of the Jakarta-Tangerang toll road, with construction slated for early next year.

Dedi said the project, which will comprise offices, apartments and shopping centers, would cost around Rp 600 billion to Rp 1 trillion.

Jasa Marga, Dedi said, would rely on its property unit, its toll service unit Jasa Layanan Pemeliharaan (JLP) and its information technology business to meet the five-year target.

The company is looking to develop a fiber optic business to earn the company up to Rp 500 billion in five years, while JLP is expected to contribute around Rp 800 billion in 2020. JLP made Rp 157.9 billion in 2014.

For this year, the company was looking to boost its non-toll revenue from around Rp 583.2 billion last year to around Rp 600 billion this year. Last year, Jasa Marga saw its non-toll road revenue up by 14.74 percent year-on-year.

Jasa Marga saw its total revenue drop by 5.3 percent to Rp 1.97 trillion in the January-March period from Rp 2.08 trillion in the same period last year, on plunging construction work amid the domestic economic slowdown, while its net profits remained stagnant at around Rp 762 billion.