Kuala Lumpur, 19 April 2023 – PT Sinar Eka Selaras, a leading provider of multi-brand retail and distribution solutions in Indonesia under the vertical name of Erajaya Active Lifestyle and MST Golf Group Berhad (“MST Golf”), Malaysia's largest specialized retailer of golf equipment, today announced the signing of a Memorandum of Understanding (“MoU”) , marking MST Golf’s first foray into the Indonesian golf retailing market.
The MoU sets out the parties’ intention to collaborate and create a joint venture company (“JVC”) to undertake the establishment and operation of golf retail business and indoor golf centres under the brand name “MST GOLF” and "MST GOLF ARENA" brands respectively.
The JVC will leverage on the synergies between both partners – MST Golf’s golf retail experience and its established brand as a golf specialty retailer, as well as Erajaya Active Lifestyle’s track record and reputation as Indonesia’s leading retailer of consumer and active lifestyle products. Erajaya Active Lifestyle owns and operates major retail brands specializing in lifestyle gadgets, the Internet of Things (IoT) and its ecosystem, smarthome, sports fashion, diving and others. Erajaya Active Lifestyle is a business vertical under PT Erajaya Swasembada Tbk (“Erajaya Group”), a public listed company on the Indonesia Stock Exchange with net sales of USD3.3 billion recorded in its financial year ended 2022.
The Erajaya Group, through its respective Erajaya business verticals, is a leading Indonesian retail player and distributor with a wide omnichannel retail coverage. It has a strong distribution network that connects more than 1,700 retail stores and 89 distribution centres across the region, supported by a formidable logistics and integrated supply chain.
As the leading golf retailer in Malaysia, MST Golf brings its expertise in golf retailing, product merchandising, and customer service with strong brands support to the Indonesian market. Erajaya Active Lifestyle will provide its expertise in importation and supply chain management, sourcing of high potential retail locations in shopping malls and other suitable commercial properties, human resources, government relations and local authorities compliance matters to support the business expansion.
Subject to the finalisation of the business plan and execution of definitive agreements are anticipated to occur this year, the JVC will introduce MST Golf’s retail outlet concepts, encompassing MST Golf Specialty store, MST Golf Arena (indoor golf centre featuring simulator bays complete with food and beverage offerings) and the Golf Lab (golf academy with club fitting) to the Indonesian consumer market. This will be delivered primarily through the establishment of a large store format retail outlet chain that offers a broad selection of high-quality golf products, equipment comprising golf clubs, golf balls and accessories and golf apparel from notable brands, as well as other value-added services. MST Golf’s retail outlets aim to offer a one-stop golf equipment retail environment to suit the needs of various consumer target groups, while the indoor golf centres with direct access from the retail outlets provide golf playing, learning and other activities suitable for individuals, families and groups covering golfers and the general public.
“We are very pleased to partner with MST Golf to expand its retail reach in Indonesia. This collaboration fits Erajaya Active Lifestyle’s growth strategies and emphasis on the active lifestyle space. We have successfully established ourselves as the leading player in this field, combined with our parent company’s decades of experience in the retail segment, makes us a formidable retail force in Indonesia,” said Djohan Sutanto, Chief Executive Director of Erajaya Active Lifestyle.
“In Indonesia, we have witnessed a consistent increase in golfing interest among the Gen-Z demography, particularly during the COVID-19 pandemic. This is because people generally wanted to stay healthy and be able to have outdoor exercises s, while adhering to health protocol and social distancing. Despite the post-pandemic recovery, these so-called ‘pandemic golfers’, who are new golfers who began learning and playing golf during the pandemic, have been constantly plying the many golf courses and driving ranges across Indonesia. Furthermore, with golf becoming part of the mainstream pop culture – aided in part led by the various innovative and hip cross-collaborations among retail brands, celebrities, and influencers – the sport has never been more relevant and appealing to the masses across all ages and income groups, and as such, the industry’s outlook remains promising.”
“We are thrilled to collaborate with Erajaya Active Lifestyle to bring our passion for golf and retailing to the Indonesian market. The Erajaya Group is well-known and respected in Indonesia, and its extensive retail business infrastructure and notable local knowledge will contribute tremendously in establishing the MST Golf brand in Indonesia,” said Ng Yap, Executive Director and Group Chief Executive Officer of MST Golf.
“At MST Golf, we strive to deliver golf shopping, learning, and playing experiences to both golfers and non-golfers, while also promoting the growth and enjoyment of the sport in the region. We couldn’t have found a better partner than Erajaya Active Lifestyle, who has a similar management approach to MST Golf which is essential for a long-term business partnership like ours. To this end, our partnership will certainly add value to MST Golf and Erajaya Active Lifestyle by achieving both companies’ objectives and goals.”
The expansion into Indonesia is part of MST Golf’s key business strategies and growth plan to expand into new geographical markets. In 2021, Indonesia’s real Gross Domestic Product (“GDP”) grew by 3.7%, and for the first 9 months of 2022, Indonesia’s real GDP grew 5.4% as compared to the first 9 months of 2021 (Source: Statistics Indonesia).
“We are very excited about the Indonesian market with its growing population, emerging affluence of the young and middle class, which adds to the market’s vibrancy, supported by an overall robust economic growth. In particular, we are pleased to note that the domestic golfing demography is still being led by younger generationswith a relatively higher spending power. Furthermore, the high standards of golf industry infrastructures, such as golf courses and driving ranges, continue to foster a favorable atmosphere for more active golfing while also attracting new golfers. This collaboration will accelerate our expansion ambition to capture a significant share of Indonesia's burgeoning golf market." Ng Yap added.
MST Golf has submitted its initial public offering (“IPO”) application to the Securities Commission Malaysia and is seeking to list on the Main Market of Bursa Malaysia Securities Berhad. Subject to the authority’s approval, proceeds raised from the IPO has been earmarked for, among others, MST Golf’s expansion into new geographical markets namely Indonesia, Thailand and Vietnam.
For further information, please contact:
Didit Putra Erlangga
Public Relations Erajaya Group