Kao Expands in Indonesia

Kao Corporation President and CEO Michitaka Sawada said the company will build a second plant for PT Kao Indonesia at Karawang International Industrial City (KIIC), located in the east of Jakarta, Indonesia. This new plant is expected to reinforce Kao’s stable supply system, as the company is anticipating active and increasing demand for daily-use products in the Indonesian market on the back of rapid economic growth in the country. The second plant site covers about 140,000 square meters, which is 1.6 times larger than the area of the existing plant. Construction will start in October 2012, and operations are scheduled to begin at the end of 2013.

The Cikarang plant, now in operation, has almost reached its capacity. Moreover, as the current plant site area is insufficient for future expansion, Kao decided to expand its production base. With completion of construction of the second plant at KIIC, Kao Indonesia will increase production capacity for laundry detergent and sanitary napkins. At the same time, Kao Indonesia will be capable of meeting future business expansion, particularly for disposable diapers.

Kao considers Asia and the ASEAN region, particularly growing countries such as Indonesia, China and Vietnam, as very important to its strategy and will actively promote business expansion in these areas. Construction of the second plant is in line with the strategy. Investment for the new plant, including land and new facilities, will amount to approximately 10 billion yen.

In building a second plant of Kao Indonesia adjacent to a new chemical plant of PT Kao Indonesia Chemicals that is now under construction for production of surfactants and industry-use chemical products.