Indonesia's leading herbal medicine producer, Sido Muncul, is exploring the potential sale of a stake in the company as its shares decline, reflecting investor concerns over growth and valuation. The move comes after a 8.5% drop in its stock price over the past year.
- Sido Muncul shares declined 8.5% over the past 12 months
- Company is evaluating a stake sale to raise funds
- Revenue reached IDR 1.8 trillion in 2024
- Net profit margin fell to 14.2% in 2024
- Potential funding from stake sale could exceed IDR 1.2 trillion
- Proceeds would target R&D, digitalization, and distribution
Sido Muncul, a top-tier herbal medicine manufacturer in Indonesia, is actively evaluating a potential equity stake sale, according to market sources. The firm, which operates across Southeast Asia, has seen its share price decline by approximately 8.5% over the past 12 months, signaling investor unease despite its dominant domestic position in the traditional herbal remedies sector. The proposed divestment could involve a minority or controlling interest, with the company seeking strategic partnerships to bolster capital and expand regional operations. The move underscores growing pressure on Indonesian consumer goods firms to enhance liquidity and strengthen balance sheets amid rising input costs and competitive intensification in the health and wellness space. Sido Muncul’s revenue reached IDR 1.8 trillion in the 2024 fiscal year, driven by continued demand for its flagship products including Sido Muncul Syrup and traditional herbal tablets. However, the company’s net profit margin dipped to 14.2% in 2024, down from 16.8% the prior year, due to supply chain disruptions and increased marketing spend. If executed, the stake sale could bring in funding exceeding IDR 1.2 trillion, which would be allocated toward R&D for new product lines, digital transformation, and distribution network upgrades. The company’s board has appointed a financial advisory panel to assess potential bidders, including private equity firms and regional health conglomerates. Analysts note that a successful transaction could stabilize investor sentiment and potentially reverse the downward trend in share performance.