INALUM Achieves BBB- Rating with Stable Outlook from S&P

PT Indonesia Asahan Aluminium (Persero), or INALUM, has obtained an international credit rating of ‘BBB-’ with a stable outlook from S&P Global Ratings. This achievement establishes an international investment-grade rating for INALUM, marking a significant milestone in strengthening the company’s credibility in both domestic and international financial markets to support its future growth.

In its report published on 7 September 2026, S&P Global Ratings assessed INALUM’s strategic position within the MIND ID Group and the strong support provided by the Government through MIND ID. S&P Global Ratings also views INALUM as playing a vital role in driving bauxite downstreaming and developing the national aluminium value chain, in line with MIND ID’s strategic agenda to strengthen Indonesia’s integrated mineral and metal industries.

INALUM President Director, Melati Sarnita, stated that this achievement serves as both recognition and momentum for the company to continue strengthening its business fundamentals and implementing a sustainable transformation of the national aluminium industry. She noted that achieving investment grade is a responsibility for INALUM to maintain prudent and sustainable corporate performance.

“Amidst our expansion and downstreaming agenda, we will ensure that growth does not merely chase scale but remains built upon strong operational fundamentals, financial discipline, and robust governance. With the support of MIND ID, we will continue to strengthen the national aluminium value chain from upstream to downstream. The development of SGAR 2 and Smelter 2 is intended not only to increase capacity but also to strengthen raw material independence, enhance the competitiveness of the national aluminium industry, and create long-term value for Indonesia,” Melati said in an official statement on Friday (11/9/2026).

The close strategic and financial ties with MIND ID further strengthen INALUM’s credit profile and support the sustainability of its business development and investments. The stable outlook reflects S&P Global Ratings’ expectations regarding the sustainability of INALUM’s operational performance and cash flows, as well as the consistent support from MIND ID in sustaining INALUM’s strategic role in the national aluminium industry.

This international rating achievement complements the strengthening of INALUM’s credit profile in the domestic market. In August 2026, PEFINDO also upgraded INALUM’s rating by one notch from idAA-/Stable to idAA/Stable, after INALUM had maintained its idAA- rating for the previous three years. These rating upgrades occur as INALUM prepares to increase its funding requirements to support various aluminium downstreaming projects during the 2026-2029 period.

In its assessment, S&P Global Ratings also highlighted INALUM’s competitive operational cost structure. The company is noted to operate within the first quartile of the global cost curve compared to the industry average in 2026. This efficiency is supported by a stable supply of hydro energy and the integration of domestic raw material sources.

This cost advantage is considered a key strength for INALUM’s credit, providing resilience against global aluminium price dynamics. S&P Global Ratings also highlighted the use of hydropower, which allows INALUM’s smelters to not only contribute to carbon emission reductions but also support profitability and production cost efficiency.

Currently, INALUM operates primary aluminium smelters with a production capacity of approximately 275,000 tonnes per year. Through its majority ownership in PT Borneo Alumina Indonesia (BAI), INALUM has successfully reduced its dependence on imported alumina raw materials.

BAI operates the Smelter-Grade Alumina Refinery 1 (SGAR 1) in Mempawah, West Kalimantan, with a capacity of approximately 1 million tonnes of alumina per year. Furthermore, S&P Global Ratings assessed INALUM’s strategic position in the MIND ID Group integration and aluminium downstreaming as providing a strong foundation for sustained support from its parent company.

This role is further strengthened through the development of SGAR 2 and Aluminium Smelter 2 (Smelter 2) as part of National Strategic Projects aimed at strengthening the integration of the national aluminium value chain.

The development of these projects is also supported by major shareholders through strategic partnerships and capital support, reflecting the importance of these projects for the national aluminium industry. The INALUM project developments include SGAR 2 and Smelter 2, both of which are part of National Strategic Projects.

SGAR 2 is planned to add an alumina production capacity of approximately 1 million tonnes per year, effectively doubling the existing capacity. Meanwhile, Smelter 2 is designed with a production capacity of approximately 600,000 tonnes of aluminium per year, which will increase INALUM’s total primary aluminium smelter capacity to more than three times its current level. The development of these projects has the potential to significantly increase INALUM’s capacity and revenue potential through 2030.

Positive industry conditions are expected to support INALUM’s performance over the next one to two years. Aluminium prices are expected to remain supportive due to tight global supply conditions, while stable sales volumes from existing smelters will support the company’s EBITDA growth.

Moving forward, INALUM will continue to maintain a balance between growth, financial discipline, and operational excellence. Through the development of an increasingly integrated aluminium value chain, INALUM is committed to strengthening national industry competitiveness, reducing import dependence, and increasing value.