KT&G Launches Indonesia Plant to Anchor Global Supply Chain
With the inauguration of its new facility in Pasuruan, East Java, KT&G has finalized a five-country production network spanning South Korea, Russia, Kazakhstan, Türkiye, and Indonesia. The move establishes the Indonesian site as the company’s largest overseas manufacturing hub, capable of producing 35 billion cigarette sticks annually.
The expansion follows a strategic pivot initiated in 2023 to secure a stronger foothold in the Asia-Pacific region. KT&G, which entered the Indonesian market in 2011, now holds the fourth-largest market share in the country. The new plant represents a critical component of the firm's 2.4 trillion KRW capital expenditure program. Once all nine manufacturing lines are fully operational, the site will complement the existing facility’s 14 billion-stick capacity, pushing total output to 35 billion units.
Beyond domestic supply, the Pasuruan plant serves as an export gateway to markets including Taiwan, Mongolia, Nigeria, and India. By 2028, the company aims to shift over 60% of its total production to overseas bases. CEO Bang Kyung-man emphasized that this global footprint is designed to improve logistics efficiency and economies of scale, providing a stable foundation for future growth and continued shareholder returns through buybacks and dividends.
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