Iron oxide pigment is a pigment developed from iron ores or iron sands, acted as coloring agent mainly used in painting industry, fertilizer, paving block, ceramics, cement, and automotive. So far, the demands are supplied by importing from European countries, USA and China, such that the pricing is high. In contrast, the raw materials, iron ores, are exported by Indonesia and locally never been processed further into pigment. The huge market share, simple manufacturing process, and abundance of available natural resources motivated PT Nanoteh Inovasi Indonesia to develop the business as the first company to manufacture iron oxide pigment in Indonesia.
Started in 2014, with equity financing of US$1,000,000 to cover facilities, land, and working capital, we share 50% of our shares to angel investor. Our company expects to have a monthly production capacity of 132 tons. It passed feasibility study, considering fluctuations in monetary exchange rate and production capacity. It is projected to have yearly gross profit of US$750,000 – US$1,050,000, Net Present Value of US$900,000 – US$1,500,000 (at 13% discount rate), payback period of 19 – 22 months, and Internal Rate of Return of 60 – 80%. In conclusion, the business is feasible and profitable in all conditions.