Issue link: https://read.dmtmag.com/i/1547352
52 tobaccoasia Issue 6, 2026 November / December Huabao is expanding its r&d into heated tobacco and oral tobacco, with work spanning core materials, product design, and heating- system adaptation. Credit: Elke Pieper, Nadja Mallock, Frank Henkler- Stephani, and Andreas Luch, CC BY 4.0 ORACO oral nicotine films. The company says it established a manufacturing base in Indonesia in 2023 and that NUSO and NMATE are available in more than 30 countries. However, there is an important distinction. Huabao's acquisition announcement characterizes the transaction as the purchase of PT Broad Far Indonesia's equity. It does not identify NUSO, NMATE, or any of Broad Far's other trademarks as assets to be transferred to Huabao. The acquisition gives Huabao control of the Indonesian HNB manufacturing business, not necessarily of Broad Far's branded product port- folio. The post-acquisition agreements further em- phasize manufacturing. As long as Zhu remains the ultimate control- ling shareholder of the purchasers, the sellers and related parties will be restricted, without consent, from engaging in HNB stick production or pro- cessing that competes with PT Broad Far Indone- sia. PT Broad Far Indonesia will also have the first opportunity to supply HNB sticks to the Broad Far group when its commercial terms are no less favorable than those of other suppliers. The relationship with Broad Far will con- tinue after the acquisition. Huabao established transaction caps of RMB18.04 million for the pe- riod from September 25 through December 31, RMB53.73 million for 2027, and RMB66.15 mil- lion for 2028. In calculating those limits, Huabao assumed that related sales volume would increase by approximately 27.6% in 2027 and by an addi- tional 22.8% in 2028. These figures are assump- tions used to establish the connected-transaction caps, not revenue forecasts for either PT Broad Far Indonesia or Huabao International. The acquisition comes as Huabao is invest- ing more resources into its international tobacco business. Its tobacco raw materials segment gener- ated RMB199.3 million in revenue in the first half of 2026, down 16.4% year over year. Operating profit fell 86.7% to RMB4.16 million. Huabao at- tributed the declines primarily to geopolitical dis- ruptions and shifting market demand. At the same time, the company has been ex- panding internationally. Huabao said its tobacco raw-materials strategy includes overseas produc- tion, international customer development, and ad- ditional investment in HNB and other innovative tobacco technologies. The company said it plans to accelerate ramping up its Indonesian capacity and deepen joint r&d and production cooperation with international tobacco companies. Buying PT Broad Far Indonesia adds another piece to that strategy. Huabao has been developing technologies for heated tobacco products, with offerings spanning reconstituted tobacco leaf, granulated tobacco, plant-based filter materials, and HNB devices. Credit: Huabao Huabao is investing more resources into its international tobacco business. Credit: Huabao.