WSBP Precast Plant Feasibility Study
Two-Phase Post-Restructuring Feasibility Study for PT WSBP
- Type of process : Financial feasibility study and strategic business review
- Client side : PT WSBP
- Core tool : Proforma Assessment, NPV, IRR, Required Return, TAM / SAM / SOM, DCF, AACE Class 4 Estimate, and scenario modelling
- Complexity driver : Low post-restructuring utilization, multiple plant locations, high historical CAPEX, unfinished plant construction, land / lease issues, and maintain / divest / spin-off decision-making
- Sector exposure : Precast concrete, infrastructure, construction materials, and government-linked infrastructure projects
Background
- Following PT WSBP’s restructuring, the Company had more positive cashflow room, but plant utilization and commercial recovery remained below optimal levels.
- PT WSBP required a feasibility study to assess whether its Precast Plants should be maintained, optimized, diversified, or divested.
- E&L was appointed under two mandates: Phase 1 and Phase 2.
- Phase 1 assessed six plants: Kalijati, Karawang, Sadang, Subang, Bojonegara, and Penajam. This Phase covered historical performance, working capital, CAPEX, MOIC, IRR, NPV, plant-level feasibility, and maintain / divest considerations.
- Phase 2 focused on Bojonegara and Penajam as follow-on analysis. This Phase assessed workshop optimization, Concrete Bricks, Warehouse, asset divestment, and commercial structures such as JV, JO, lease, and sale.
- The study was prepared to support management decision-making on asset productivity, business continuity, and future investment allocation.
E&L Value Add
- E&L reviewed PT WSBP’s post-restructuring operating condition, historical plant performance, utilization, working capital, and CAPEX requirement.
- E&L built Business-as-Usual, Base, and Optimist scenarios using Proforma Assessment, NPV, IRR, Required Return, DCF, and key financial ratios.
- E&L assessed market potential using TAM / SAM / SOM across government projects, private projects, and unidentified construction market opportunities.
- In Phase 1, E&L reviewed six plants and provided plant-level recommendations on feasibility, utilization improvement, CAPEX, and maintain / divest options.
- In Phase 2, E&L conducted deeper technical, commercial, and financial review of Bojonegara and Penajam, including site visit findings and AACE Class 4 Estimate.
- For Bojonegara, E&L assessed workshop consolidation, equipment compatibility, process flow, manpower impact, redundant asset use, and spin-off business options
- For Penajam, E&L assessed unfinished construction, additional CAPEX, IKN-related demand, warehouse / logistics potential, and divestment alternatives.
Outcome
• E&L identified low utilization and under-optimized manufacturing assets as WSBP’s key post-restructuring challenge.
• The result for each phase:
◦ Phase 1 showed plant feasibility was highly sensitive to utilization, volume recovery, and asset productivity. Bojonegara was feasible only under higher-utilization /
Optimist conditions and required business alternative support. Penajam remained not feasible due to unfinished construction, high additional CAPEX, IKN uncertainty, and limited near-term logistics catchment.
◦ Phase 2 refined the analysis through workshop optimization, Concrete Bricks, Warehouse, asset divestment, and combination scenarios.
• The study provided a decision framework to maintain core precast operations, optimize workshops, pursue spin-off businesses, divest assets, or defer investment pending further validation.