KT&G to Build New Factory in Indonesia

On September 11th, according to a report by the Korean newspaper "East Asia Daily", KT&G announced plans to construct a new factory in East Java province, Indonesia, scheduled to begin operations in 2026. This decision was made after reaching an agreement with the Indonesian Ministry of Investment.

The Indonesian Investment Ministry has pledged to provide various support and conveniences in accordance with local regulations. KT&G plans to proceed with the necessary procedures, such as board resolutions, once key matters such as the specific investment amount, method, and objectives have been determined.

The new factory is scheduled to start operating in 2026, and its products will be exported to overseas markets such as Southeast Asia. With this move, KT&G aims to establish Indonesia as a production base for exporting products abroad and is committed to expanding its international market.

This investment plan is part of KT&G's announced 5-year investment plan in core business areas, which is a part of the company's long-term growth strategy. The plan will focus on developing three major core business areas, namely NGP (non-combustible e-cigarettes), health functional foods, and global CC (traditional cigarettes).

In addition, KT&G plans to achieve over 10 trillion South Korean won in sales by 2027, based on investment in growth in its core business areas. It aims to increase its global business sales to over 50% by actively tapping into global markets, and to raise the proportion of non-traditional businesses such as NGP and health functional foods to over 60%.

Indonesian Investment Minister Bahlil Lahadalia has stated,"We, on behalf of the Indonesian government, warmly welcome KT&G's ongoing investment and plan to make every effort to ensure the smooth progress of the investment plan."

KT&G's President, Baek Bok-in, stated,"By establishing a new factory in Indonesia, the company aims to strengthen its expansion efforts in overseas markets such as Southeast Asia. We will continue to seize opportunities in foreign markets and strive to become a globally renowned enterprise through proactive investments and innovation."