10 In­done­sian firms set for IPOs this year, mostly in Q2

The China Post - - WORLD BUSINESS - ANGGI M. LU­BIS

IT so­lu­tion provider An­abatic Tech­nolo­gies and oil and sur­veyor firm Gelom­bang Seis­mic In­done­sia (GSI) will be the lat­est com­pa­nies in In­done­sia to go public this year af­ter a weak first quar­ter that saw just two ini­tial public of­fer­ings (IPOs). The bourse is seek­ing 32 IPOs this year.

With An­abatic and GSI hav­ing met with In­done­sia Stock Ex­change (IDX) rep­re­sen­ta­tives on Fri­day to fi­nal­ize their IPO, there are now 10 com­pa­nies slated to make their public de­but this year. The other eight firms have met the same re­quire­ment, lo­cally known as a “mini ex­pose,” in which they present their IPO plans and fi­nan­cial per­for­mances to the bourse.

Most of the com­pa­nies pre­par­ing their IPOs are in the prop­erty sec­tor: PP Prop­erty (a sub­sidiary of state-run con­struc­tion firm Pembangunan and Peruma­han; Pu­radelta Les­tari (a firm un­der Si­nar Mas Land); Mega Ma­nung­gal Prop­erty; and Bi­nakarya Jaya Abadi.

The other com­pa­nies are Sara- toga group-af­fil­i­ated min­ing firm Merdeka Cop­per and Gold; Lippo group ca­ble TV provider In­done­sia Me­dia Tele­visi; au­to­mo­tive man­u­fac­turer Garuda Me­talindo and Val­lianz Off­shore Mar­itim.

Most of the firms are ex­pected to en­ter the mar­ket by the end of the sec­ond quar­ter. An­abatic Tech­nolo­gies and GSI ex­pects their shares to be listed on the bourse in June,

“Ten days from now, the IDX will send a let­ter to the OJK (Fi­nan­cial Ser­vice Author­ity) to no­tify (the body) about An­abatic’s IPO plan,” said Agung Sid­harta, pres­i­dent and direc­tor of Ba­hana Se­cu­ri­ties, which will un­der­write An­abatic Tech­nolo­gies’ IPO.

He de­clined to elab­o­rate on the de­tails of the IPO, such as the amount of shares that will be of­fered, the ex­pected funds to be raised, or the al­lo­ca­tion of pro­ceeds for An­abatic Tech­nolo­gies’ ex­pan­sion plans.

An­abatic Tech­nolo­gies was founded in 2002, fo­cus­ing in pro­vid­ing in­te­grated IT so­lu­tions for a va­ri­ety of busi­nesses, in­clud­ing bank­ing, telecom­mu­ni­ca­tions, phar­ma­ceu­ti­cals and gov­ern­ment. The com­pany ex­panded into In­dia last year, set­ting up a sub­sidiary arm in Ban­ga­lore.

GSI is an oil and gas ex­plo­ration com­pany spe­cial­iz­ing in pro­vid­ing 3D data.

Hen­dra Kus­tarjo, pres­i­dent direc­tor of Panca Global Se­cu­ri­ties, which will un­der­write GSI’s IPO, said GSI would float around 30 per­cent of its shares.

“The com­pany is rel­a­tively small in as­sets, amount­ing to less than 1 tril­lion ru­piah (US$77.52) mil­lion, but its port­fo­lio has reached Mozam­bique. It is also cur­rently bid­ding for a US$80 mil­lion project,” he said.

“The com­pany will use 70 per­cent of pro­ceeds from the IPO for its cap­i­tal ex­pen­di­ture, while the re­main­der will be al­lo­cated for work­ing cap­i­tal.”

The bourse aimed to have 32 com­pa­nies en­ter the lo­cal stock mar­ket this year, but so far only two com­pa­nies have listed their shares on the bourse since Jan­uary — the poor­est first-quar­ter show­ing in five years.

The two com­pa­nies are hos­pi­tal op­er­a­tor Mi­tra Kelu­arga Karyase­hat, which raised 4.45 tril­lion ru­piah, and Bank Yudha Bakti, which took up 58.6 bil­lion ru­piah from the stock mar­ket ear­lier this year.

The lack­lus­ter IPO en­vi­ron­ment is re­flec­tive of the cau­tious ap­proach of lo­cal com­pa­nies amid a ru­piah de­pre­ci­a­tion and weak eco­nomic growth that is ex­pected to im­prove only marginally in Southeast Asia’s largest econ­omy this year.

The ru­piah dropped 5.3 per­cent in the first quar­ter — the worst per­for­mance in Asia af­ter Malaysia’s ring­git — ac­cord­ing to Bloomberg data. Mean­while, the gov­ern­ment’s eco­nomic growth tar­get of 5.7 per­cent has been deemed overly am­bi­tious, with econ­o­mists down­grad­ing pre­dic­tions to near 5 per­cent, the low­est level in five years.

With the re­cent boom in de­mand over U.S. dollar as­sets due to the re­cov­ery of the world’s top econ­omy and a po­ten­tial rate- hike by the U.S. Fed­eral Re­serve cen­tral bank later this year, sell­ing pres­sures have been preva­lent in emerg­ing economies, in­clud­ing In­done­sia.

In­done­sia’s stock mar­ket has grown by about 5 per­cent so far this year, much less than China’s near 25 per­cent surge and more in line with the gains of other coun­tries in the re­gion, such as Thai­land and Sin­ga­pore (about 3 per­cent) and Malaysia (4.7 per­cent).

De­spite the chal­lenges, IDX pres­i­dent direc­tor Ito War­sito pre­vi­ously said he was op­ti­mistic the bourse could reach its tar­get of hav­ing 32 com­pa­nies go public this year.

“Most IPO can­di­dates are still wait­ing for their au­dited 2014 fi­nan­cial re­sults. We ex­pect more firms to go public in the sec­ond or third quar­ters,” Ito ex­plained.

The lo­cal stocks’ bench­mark Jakarta Com­pos­ite In­dex (JCI) has con­tin­ued to break records this year, and over­seas in­vestors have bought nearly 7 tril­lion ru­piah worth of stocks — more than they sold.

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