PT Indika Energy Tbk (INDY) plans to divest several coal assets and invest up to US$1 billion in non-coal assets to increase the revenue contribution from the non-coal business by up to 50% by 2025.

This was revealed in a research conducted by Fitch Ratings Indonesia, quoted on Monday (24/5).

Fitch assesses that the amount of investment made by Indika is under the risks it will face.

Fitch also views Indika's long-term strategy to reduce exposure to coal-related businesses as a wise move, given the increasing pressures on environmental, social, and governance (ESG) commitments in the medium term.

Therefore, business diversification measures will help Indika maintain access to funding in the event of a material tightening of the coal business entity. Currently, Indika has good access to the capital market and bank loans.

Fitch added that most of the investments made by Indika to support group diversification have so far been small