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Sunday, December 10, 2017

DBS Predicted Indonesia's Economy in 2018 is Growing Faster Than 2017

Indonesia is one of the countries with the strongest economic fundamentals in the Asia region. Various indicators show a good performance, such as the ratio of government debt which is below 30% of GDP, one of the lowest among developing countries.

With a Government that is stable and relatively low political risk, Indonesia's economic potential to move more quickly in the next few years. External factors being the main economic growth of Indonesia towing, especially those from the rise in commodity prices.

"We estimate that Indonesia's economic growth will rise 5.3% and 5.4% in 2018 and 2019," said DBS Group Research Economist Gundy Cahyadi 'Indonesia in 2018/19: Higher gear?' which was released November 20, 2017.

The challenge is how the Government can accumulate a variety of indicators to spur economic growth faster. Like, encourage private investment that since 2013 percentage decline. The Government's efforts through infrastructure development seems to have reaped results. This is visible from the investment growth which reached 7.1% in quarter III-2017, the highest since the quarter I-2013. The investment is estimated to account for 35% towards GDP 2017 growth.

Private investment in the count because of the limited government fiscal space The Constitution governs the restriction of a maximum budget deficit of 3% of GDP. It is estimated the deficit will reach 2.6% by 2018, higher than the Government's estimate of 2.2%. DBS Group Research predicted a rise in the deficit driven mainly by a decline in potential tax revenue, rather than budget increases.

However, the trend of rising world crude oil prices will boost the country's revenue from the oil and gas sector. In the calculation of the DBS Group Research, any rise in oil prices by 10% will give you an extra budget of Rp 6.7 trillion in state budget.

Unlike most other countries, Indonesia is one of the countries that do not take advantage of the growing global demand for manufactured products. Indonesia's exports still rely on the commodity sector, particularly coal which grew 49 percent, crude palm oil amounted to 44%, and oil and gas amounted to 21%. While exports of manufactured products only grew 2.5%.

The Government has committed to reduce the dependence of commodity products. This is done by publishing the 16 Policy Reform Package in the last two years. Proven, Indonesia's ranking in the Ease of Doing Business were released World Bank soared from 106 ranking in 2016 be 72 in 2017.

Foreign direct investment into the manufacturing sectors listed record highs of US$16.6 billion in 2016. Investors no longer makes the mining sector as an investment destination, but rather the sector of machinery and electronics.

The pressure of inflation, estimated to be likely to be stable mainly caused the price of groceries. This as the Government repair distribution lines so price disparity interregional decreases. As for the biggest inflation risk comes from the increase in the price of crude oil, especially in the transport sector and electricity accounted about 25% of the consumer price index.

Wide range of indicators is expected to encourage the consumption of households. The issue, improving commodity sector that occurred the last time does not directly impact people's income. The ability to buy, especially in the community of the low income class, is still low.

As seen from the consumption of non-staple goods or discretionary goods the community dropped to 4.5%, well below the conditions three years ago amounted to 6%.

"Indonesia's economic growth will be higher if the growth in consumption discretionary goods community higher," said Gundy.

Franklin Templeton Investment: Emerging markets are still bullish in 2018

Mark Mobius, the Emerging Markets Fund Manager of Franklin Templeton Investments, predicts emerging markets will continue to increase in the upcoming trends in 2018. According to him, it is based on the history of the growth of that ever happening in emerging markets.

At this time, according to him, the rapid growth in the market for a wide range of developing countries in Asia, Africa, and other countries such as Russia and Brazil have just begun. Looking at the history, he believes this growth could still continue on next year and the following years.

"Emerging markets have a history of growth that is optimistic. If being bullish, usually movement that will last for five years, "said Mobius in a panel discussion on the show Bloomberg The Year Ahead in Asia Jakarta.

The high-growth emerging markets ever reached on the 2007, estimated could happen again in the next few years. Mobius even convinced emerging markets can grow 20% from a record growth in 2007.

Although he is very optimistic towards the growth of the emerging markets in the future, but there is still some risk that must be considered. One such risk is geopolitical.

"There is a great possibility of United States military will do something to put a stop to North Korea. If that happens, the market will react and could crash at any time, "he explained.

Why Chinese investors love to invest in Indonesia?

It's been no secret that a lot of investors from China are fond of infusing capital in Indonesia. A variety of fields, ranging from media, e-commerce to virtual reality to be areas that are enticing to do. This brings up the question, why the heck are they so actually interested in investing in Indonesia? What specials from Indonesia than other countries?

Four practitioners of Chinese investment reveal the reasons behind such interest. They are a founder of Convergence Ventures Adrian Li, co-founder of 01VC Ian Goh, Tony Qu (managing partner ATM Capital), and AppWorks Ventures Joseph Chan. What they said, let's take a look below.

POTENTIAL AND LACK OF INVESTMENT IN INDONESIA


Speaking of potential in Indonesia, of course we've already learned that the number of people of Indonesia is a very large potential market. But the advantages not only that. One of the interesting things in Indonesia is that over the past four to five years, data has shown anyone "player" that comes out as the winner. It means choosing what companies are worth investing in is not difficult thing.

The Government of Indonesia also continues to actively perform regulation follows the movement of the digital economy, especially on the side of fintech. Currently the Chinese investors indeed are expands into South East Asia, with the two sectors as the focus i.e. e-commerce as well as a digital wallet. The climate of Indonesia regulation tends to be friendly is in line with their vision.

According to them, the exuberance of fintech in this country are caused by two things, namely:
  • Poor condition of banking in Indonesia
  • The high interest in the youth towards the development of technology.
Bank transactions in Indonesia classified as ineffective, even slower. So among the young who are tech savvy, alternative services will be greeted with delight, whether in the realm of B2B, B2C or C2C.

But it does not mean that Indonesia had no barriers. The classical constraints that still we need to solve is the problem of infrastructure. But these barriers can also be viewed as oportunities. Chinese investors are interested in bringing the technology goes into Indonesia to improve the quality of the internet in here.

INDONESIA AND CHINA HAVE MANY SIMILARITIES


Chinese investors vied for the Southeast Asia region as target expansion, but Indonesia had a specific reason that makes it interesting. This is because Indonesia has similarities with China in ancient times. The condition of Indonesia in 2017 is similar to China in 2004, or by India in 2007.

What are the similarities?
  • The large number of startup sprung coupled entrepreneurial spirit.
  • Interest in e-commerce is very high.
  • Conditions of mobile technology-first.
  • The amount of capital that rotates the digital industry in Indonesia are still classified as small.

The same thing happened when China was at first, a condition where investors from Silicon Valley in droves come to bring in capital. As a result, any Chinese digital industry is growing very rapidly. Similarly, China now wants to be the "Silicon Valley investors of Indonesia".

RESPECT THE POWER OF LOCAL PLAYERS


Although been penetrating into Indonesia, foreign investors also understand that Indonesia had local players. Thus they feel Indonesia's local company will become the ruler here. Indonesia's digital giants still continues to grow, and in the future will be the giant in the Southeast Asian regional level.

The strength of a solid local is growing due to various factors. One is the knowledge of the terrain. Indonesia people better know what is wanted by Indonesia market. For example, here media and entertainment is very popular, but two things were not so big in America and China.

The problem of logistics is also not something that can be mastered in a short time. Giants of e-commerce in Indonesia is not only selling the goods. They also sell pipeline (workflow) logistics. This can only be obtained when we've "played" for a long time.

THEY WANT FROM INDONESIA


When asked about what is the most important sector is done in Indonesia, these four startup investors give different answers. Adrian Li assumed that most important is grit aka steadiness. Being an entrepreneur is very heavy work, and we can not sent someone to work on this sector or that sector. We must obey the words of the heart, then from there looking for a founder market fit.

Ian Goh on the other hand consider that the mobility sector/logistics, fintech, as well as B2B is currently the hottest sector. He wanted these sectors more earnest in Indonesia. In addition, the startup takes passion and ability to form a great team. We should not be "lone ranger".

Meanwhile Joseph Chan argue just simply: just go online. Whatever you do, the most important you have to solve a real problem. Take advantage of the internet to create solutions, then investors will open the door to work together and change the market

Jasa Marga Ready Use Komodo Bond Funds to Buy Six Waskita Karya Toll Roads!

PT Jasa Marga Tbk (IDX:JSMR) claims ready to use most of funds in the issuance of global bond rupiah denominated or called Komodo Bond worth Rp 4 trillion to buy six of the seven Trans Java toll roads belonging to PT Waskita Karya Tbk (IDX:WSKT) on next year .

CEO of Jasa Marga Desi Arryani reveals, the Komodo Bond results will strengthen capital expenditures (capex) and operating expenditure (opex) which is being estimated reach Rp 17 trillion next year. From the estimation, the company has been taking into account the needs of funds to buy toll roads belonging to the Waskita Karya.

Unfortunately, Desi can not give estimation of the magnitude of funds needed by the company to buy the toll. Because the negotiation process between the two company's continued and targeted new final quarter I 2018 to come.

"Don't know yet (it costs). Yes hopefully between buyer and seller matching. God willing (to buy six toll roads), "said Desi in the Ministry of State Owned Enterprises, Monday night (4/12).

Meanwhile, issuers coded JSMR was admitted only will buy six of the seven Trans Java toll roads belonging to issuers coded WSKT, because Pemalang-Batang Toll Road in Central Java was not to sell by WSKT. A majority stake in the toll roads i.e. approximately 60 percent owned by subsidiary WSKT, namely PT Waskita Tollroad.

In addition, the Komodo Bond results mix on capex and opex JSMR will be used for other purposes, for example, support the operation of the entire toll road owned by the company.

On the other hand, not only setting up the bond for purposes of collecting results of capex and opex, JSMR next year also continues to strengthen the funding of the banking loans. "Because our investment that the ratio was 30:70, 70 percent from the bank and 30 percent from the equity," he explained.

Komodo Bond has a tenor of three years with an interest rate of 7.5 percent and is recorded in the London Stock Exchange (ISM) and the Singapore Exchange (SGX) on 11 December.

The bonds allocated to Asia amounted to 55 percent, the United States 26 percent and Europe 19 percent. By type of investors, as many as 84 per cent is allocated to asset management, while the remaining 16 percent to to the bank/public institutions/private bank.

As for the bonds got a rating (rating) of Baa3 from Moody's and BB from Standard and poor's (S&P). The rating is given due credit and financial condition of JSMR rated strong and stable.

Earlier, Deputy Construction Businesses, Transport and Infrastructure of Ministry of State Owned Enterprises Ahmad Bambang admitted encourage JSMR in order to become the majority shareholder from all toll roads there.

"Why would we want State Owned Enterprises become operator? To provide or help small and medium enterprises (SMEs) for sale in rest areas, "said Bambang.

Saturday, December 9, 2017

Indonesia's Integrated Industrial Estate

The Indonesia government has developed a number of special economic areas (KEK) since 2010. The main goal the establishment of SEZS is attracting foreign investment, particularly by providing various incentives in the form of tax incentives, customs incentives such exemption or reduction of customs tariff of import duties, as well as investment incentives.

Special economic area usually also consists of certain industrial cluster with specific specialties, which is associated with economic potential and local resources. For example the KEK in Sei Mangke, North Sumatra, which focus on downsream of agricultural products. Much of the KEK reaped success, but there are also less-developed because of lack of support infrastructure or wrong concept.

Currently, the Government intends to make some sort of economic or industrial area to the area that has been growing. The plan was still brewing in cabinet-level. The area of interest is the industrial area (KI) in Bekasi, Karawang, Purwakarta, West Java and. This area would be used as a special corridor to attract high-tech industry investment, such as automotive and electronics. The corridor is expected to be the motor of industrialization in Indonesia.

The Government's ambition is to make the industries in the three regencies were to be integrated as a world class integrated industrial area, even being the largest in Asia. There are currently 21 industrial areas (KI) and the 10 prospective new KI in that three areas.

There are a number of great KI players in this corridor, as Jababeka, Lippo Cikarang, MM2100, and Deltamas. In Cikarang, even would stand the most modern, self-contained city in Southeast Asia, build by Lippo Group, namely Meikarta, which gobbled up investment at least Rp 278 trillion (USD 20 billion). Meikarta satellite town cover 5,000 local companies, international, and six modern industrial parks.

This strategic corridor surrounded six mega infrastructure construction of the Government, namely the fast train from Jakarta-Bandung, Patimban Port, the international airport in Kertajati, light rail train (LRT) toll road, Jakarta-Cikampek kites, as well as system a monorail linking the industrial areas in the vicinity.

This area is also the area of the automotive industry and electronics Indonesia, with annual production of about one million cars and 10 million motorcycles, as well as millions of refrigerators, TVs and household appliances. Thousands of giant multinational and national companies to build factories and bases its business on this corridor, with the support of hundreds of thousands of staff and millions of workers. The big names that are not foreigners set up factories in this corridor, including Astra, Honda, Toyota, Suzuki, Mitsubishi, Isuzu, Panasonic, Toshiba, Samsung, and Hankook. The corridor is also known as the 'Detroit of Indonesia'.

As the headquarters of a number of major industry top-tier, reasonable if the Government gives special attention to the corridors of Bekasi, Karawang, Purwakarta. Moreover, the auto industry's supply chain is following a strategic industry in Indonesia which contribute about 28 percent to the total manufacturing production that absorbs 1.5 million work force. Installed production capacity of car industry reached 2.2 million units per year, while the motor is 10 million more units per year.

The Government indeed has yet to give the name or format for this corridor. That is obviously not the special economic region. Whatever its name, the Government certain incentives worth giving. In this context, Governments need to provide adequate infrastructure support, good access to transport, energy and telecommunications. Access between an industrial area in the corridor also must be well connected. Thus was created the logistics and cost efficiency is low.

To that end, the Government must map out accurately what is required by an industrial area in the corridors of these three regencies. Because this is not a special economic region, the incentive is needed rather than fiscal, but rather at ease licensing, support infrastructure, the availability of land area, and so on.

Another aspect to be noted is the integration in terms of the management of the area. Currently, supervision management of the area still held by each district, so often a problem as administration permissions. Therefore, need to be considered in order for supervision are in one of the higher coordination, such special authority bodies. In addition, the Government needs to strive in order to access transportation between regions are connected properly.

If all of these requirements can be realized, Indonesia will have an integrated world-scale industrial area that is able to attract massive investment. Thus, the three-regency corridor not only became the center of new growth, but also provide multiple impacts (multiplier effect) are great and absorb significant amounts of labor.

Friday, December 8, 2017

Prima Cakrawala Abadi expects IPO price range of Rp 145 to Rp 155 a share

The company engaged in the the processing and distribution of small crab attaching, the PT Prima Cakrawala Abadi Tbk (PCA Foods) will conduct the initial public offering of shares (initial public offering/IPO) in the price range Rp145-Rp155 per share.

President Director of PCA Foods Raditya Vardhana in Jakarta, Thursday (7/12/2017) says that the company will take off as much as 466.6 million new shares, or about 40 percent of the capital that are placed and paid in full after the IPO.

"With the price range of the IPO was expected, we can grab the IPO funds of around Rp67,66 billion to Rp72,33 billion," he said.

He sets forth that about 30 percent of the IPO proceeds fund will be used for capital expenditures. And the rest will be used for working capital. The plan, the company will perform a repair factory, purchasing new equipment, construction of new facilities, as well as the purchase of raw materials.

In running his business, he conveys that it produces and provides canned small crab for companies in the United States (USA). The company's exports to the US since the beginning of the year until August 2017 of 292,291 kilograms (kg). While the previous year reaching 271,620 kg. In addition to the U.S. the company also exports to the United Kingdom, Bahrain, Singapore and Malaysia.

"Since the company exports in 2014, the company already has regular customers. The majority of customers are located in several states in the U.S., namely Florida, Boston, New york, and Baltimore, "he explained.

In the corporate actions that, PCA Foods appoints Artha Securities Indonesia and Lotus Andalan Securities as guarantors of implementing emissions. The company expects the get statement is effective from the financial services authority (OJK) on December 19, 2017, and is recorded in the Indonesia stock exchange on December 28th, 2017. 

Thursday, December 7, 2017

Campina sets price of IPO at Rp 330 per share

PT Campina Ice Cream Industry official pegged the price of the initial public offering (Initial Public Offering/IPO) at Rp 330 per share.

Based on the description in the Indonesia Central Securities Depository (KSEI), Campina sets share price at Rp330 per share with nominal price at Rp 100. Shares to be issued on 18 December 2017, and recorded in the Indonesia Stock Exchange (IDX) on December 19, 2017.

Previously, this ice cream manufacturer provide a share price range in Rp 310 - Rp 400 per share and releasing 885 million shares or 15,04% of capital placed and paid in the company.

With the value at Rp330 per share, then a company known for its popular ice cream products Hula Hula and Concerto potentially rake in funds Rp 292 billion.

Through the prospectus summary, the company would use the Rp 260 billion for repayment of company debt. This  debt maturing in 2021, but the company want to pay it off, so the Campina could shrink the interest expense amounting to Rp 40 billion.

Meanwhile the rest of the IPO fund, used to add the company's working capital to develop new factories in Surabaya.

Reliance Securities analyst, Aji Setiawan in his research explains, the net profit of Campina per June 2017 recorded dropped to Rp 9,98 billion from Rp 23,89 billion in the same period a year earlier.

"The decline caused by the increase in principal sales expense, general and administation expense that increases respectively of 10.9 percent, 3.1 percent and 9.1 percent in the same period in the previous year," he said.

He explains, Campina constantly looking for innovation by working with animation studio to improve ice cream products advertising. Currently the company is working with Nickelodeon and Disney to be licensees in a variety of ice cream products.

Aji added, Campina was one of the big players in the business of ice cream in South Asia and Southeast Asia. The company also has a strong modern distribution network in Indonesia.

Not only that, he stated the Campina has big production capabilities and new products development. It supported the growth of the middle class, as well as an increase in the population of young age and lifestyle of urban that consume ice cream in Indonesia.

However, on the other hand the Aji also bear the investment risk against Campina.

"The reliance on primary raw materials namely, Skim Milk, Sugar, Chocolate, Fat Chocolate became a very important thing to lead the company's business activities. This, it will have an impact on profit margins obtained by the company, "he said.

While, according to Aji, calculation of the valuation of the share price in 12 months after IPO are estimated at the level of Rp 510 per share. It is calculated using the Price to Earning Ratio (PER) or the ratio of the stock price is compared to the income of the industry in numbers 17.37 times.

"So we recommend neutral upside potential to [increase] stock company limited of 27.35 percent of the highest bidding," he explained.

Investments drive Indonesia's economic growth significantly

Indonesia is now transformed into one of the country's favourite investment destinations. With a large population, natural resources are still abundant, rising purchasing power, plus demographic bonus, making Indonesia like a ' beautiful girl ' in the eyes of investors.

Of course, there is not an easy to make Indonesia the main choice of investment. A long journey investing in Indonesia now have reached the age of 50 years.

Started when Constitution Number 1 Year 1967 regarding foreign capital investment, and Constitution Number 6 Year 1968 regarding domestic capital investment put in place.

At that time, in the new order era, the Government formed a body of Foreign Capital Investment Considerations (BPPMA) as set out in the Decree of the Presidium of the Cabinet Number 17 in 1967. Then, over time, Constitution Number 20 Year 1973, concerning the establishment of The Investment Coordination Board (BKPM).

But in the era of reform, to expedite the development of the national economy, realize the political and economic sovereignty of Indonesia, as well as to deal with the changing global economy, the Government issued Constitution Number 25 Year 2007 about Investment. Beleid was born in order to created a conducive investment climate, legal certainty, fair, and efficient.

The current head of BKPM, Thomas Lembong, argued that the presence of a proven investment pushed Indonesia's economic wheel. A year after the Investment Constitution enacted, Indonesia's economic growth reached 10.9 percent. And in 1970, Indonesia managed to suppress inflation to under 10 percent.

Of course, in the past 50 years the investment tap is opened, investments are experiencing ups and downs. Mainly due to social and political turmoil in domestic and global conditions. For example, when the political crisis whack in 1998, economic drop and stagnant investment. Post-war reform of 1998, the social conditions of domestic politics in Indonesia that is still not stable making investors doubt infusing capital.

However, slowly but surely, the BKPM was moving fast by doing coordination with ministries and other institutions, as well as pushing the friendly investment regulations. BKPM work actively with any open representative offices in eight countries to convince investors that Indonesia is the right choice to invest. The eight countries, among others, Singapore, Japan, Taiwan, United Arab Emirates, Australia, United Kingdom, United States, and South Korea.

Repairs carried out simultaneous, among others since the year 2004 system simplifies service conducting capital investment through a system of One-Stop Services (PSA) for service approval, licensing and facility investment for foreign and domestic, centralized and implemented by BKPM. that was then enhanced with National One Door Integrated Service (PTSP) based on Presidential Regulation Number 97 Year 2014. And this time, the PTSP Center of BKPM has received the approval from 22 ministries and agencies to publish licensing as well as putting Liaison Officer (LO) in the center of the PTSP Center of BKPM.

Another breakthrough in the year 2016, BKPM gave a 3-hour Licensing Service, as part of a package of Economic Policies Vol. II, which was launched by the Government. This service was subsequently further developed, by publishing 8 product licensing, plus 1 letter booking ground (if required), i.e. the investment Licence, the tax payer ID (TAX ID), deed establishment of the company and the decison of the Ministry of Justice and Human Rights, company list (TDP), permit of foreign worker (IMTA), plan the use of foreign labor (RPTKA), identifier number of the manufacturer importer  (API-P), and the number of customs carriers (NIK).

In addition, the BKPM also provide Direct Construction Investment Service (KLIK) for investor/investors that its investments are in the areas of certain industries.

In fact, to make it easier for new companies who are doing construction project investment, the government launched the green line facilities to import capital goods with just takes 30 minutes. So the imported machine can be immediately used on the schedule are planned.

Not surprisingly, the value of any investment continues to rise. The 2012-2016, the value of total Foreign Direct Investment (FDI) inflows reached USD 139.8 billion or approximately Rp 1,561.1 trillion, which is derived from the new project of Rp 1,094.2 trillion and project expansion Rp 466 trillion. Meanwhile, the Local Investment (PMDN) inflows in the same period reached Rp 772.2 trillion, which is derived from the new project of Rp 502.5 trillion and project expansion Rp 269.7 trillion.

As for the third quarter until 2017, the realization of Foreign Direct Investment (FDI) in Indonesia reached Rp 318.5 trillion, which is derived from the new project Rp 261.4 trillion and from expansion project amounting to Rp 57.1 trillion. While the realization of investment reached PMDN Rp 194.7 trillion, which comes from new projects amounting to Rp 150 trillion and expansion project Rp 44.7 trillion.

Improvement done BPKM, making Indonesia the country fourth top investment destinations of multinational corporations, according to a survey conducted by the United Nations on Trade and Development (UNCTAD). Whereas in the World Investment Report in 2017, Indonesia managed to rise four rankings sped from the previous year, after the United States ranks first in China in the second place, and India in third position.

Indonesia also reached the ranking of competitiveness to the 42 according to The 2017 IMD World Competitiveness Year Book, jump 6 level than the previous survey year 2016. The third stage of the country with the best Prospects for international business (JBIC, 2016). While based on the results of the survey, the World Economic Forum ranked Indonesia in rank 41 to Global Competitiveness Index -2015-2016 (WEF, 2016-2017).

This investment prospects of improvement are also marked Indonesia's debt rating by S&P be Investment Grade. Currently, there are four debt-rating agencies in the world was recorded already ranks Investment Grade for Indonesia, namely Investment Grade Baa3 with a projection of ' positive ' (Moody's, February 2017), Investment Grade BBB-with the projection of the ' positive ' (Japan Credit Ratings (JCR), March 2017), the Investment Grade rating of BBB-with Stable ' projection ' (Standard Poor's &, may 2017), and the Investment Grade BBB-with the projection of the ' positive ' (Fitch Ratings, July 2017).

Continuous improvement done by BPKM perceived Suhat Miyarso, Director of PT Chandra Asri. The management process changes permissions on the BKPM, making businessmen have certainty of the time, if all the requirements are already met. Said Suhat, with the online process, the document will not be lost because the stored well and easy to find.

"By having the system online and tracking system, we can immediately know if there were delays because there are terms that are not yet complete. Now, the process of filing documents online is much simpler, easier, and faster, "said Suhat.

Seung Hwa Suh, Global CEO & Vice Chairman of Hankook Tire, also agree. BKPM always give input to the Hankook Tire in each step of the decision making process of investment, so that gives confidence to make a final decision to invest in Indonesia. "Hankook Tire is eager to contribute to the economic growth of Indonesia," said Seung Hwa Suh

Over the past 50 years, the BKPM has done a variety of innovations and improvements in the various establishments to provide the best service to candidates and foreign investor in the country in Indonesia.

Wednesday, December 6, 2017

Panca Budi Idaman sets price of IPO at Rp 850 per share

Plastic manufacturer, PT. Panca Budi Idaman Tbk has set the price of the initial public offering (IPO) which falls on the lower range of prices offered company. Based on broadcast a press release delivered on Tuesday (5/12), the exercise price of the IPO is set at Rp 850 per share. Previously, Panca Budi offers the range of share prices to a new figure of Rp 810 to Rp 1,160 per share.

However, lowering the number of Panca Budi shares recently released to the public of 738.8 million shares or equivalent to 33% to only 375 million new shares or equivalent to 20% of the total paid-in capital and is placed in full. So, Panca Budi aiming for fresh funds amounted to Rp318,75 billion from the IPO.

The time of initial public offering will take place on 6-7 December 2017. Panca Budi shares will be distributed electronically on 12 December 2017. They also predict its stock can be listed on the Stock Exchange Board on 13 December 2017. Bahana securities, BCA securities and CIMB Securities Indonesia will act as managing underwriters in IPO.

Panca Budi will use 70% of the total funds obtained from the initial public offering of it for the purposes of the expansion in the form of the addition of the factory, facility distribution, and machinery. And the rest, that is as much as 30%, will be used as working capital for the purchase of raw materials. As for the first semester in 2017, Panca Budi recorded revenue of Rp 1.6 trillion, up 1.32% year-on-year (yoy). In the meantime, they obtain a profit until Rp 97.7 billion aka grow 24.14% yoy.


2015
2016
30 June 2017
Assets
921.5
1353
1382
Revenue
2787
3168
1607
Equity
173
791,4
886,5
Liability
748,5
561,8
496,1
Net income
14
138,4
97,7
NB: In billion Rupiah

Monday, November 27, 2017

United Tractors in the High Growth Trend!

PT United Tractors Tbk (UNTR) is projected to be able to keep the increase in sales of heavy equipment and coal mining business until next year. It is expected to be the underpinning the growth of financial performance.

RHB Securities is targeting a rise in the company's net profit to Rp 8.86 trillion (USD 665 million) in 2018, compared to an estimate of the year 2017 Rp 7.66 trillion and realization years ago of Rp 5 trillion. Revenue is expected to rise to Rp 70.50 trillion (USD 5.2 billion) in 2018, compared this year's estimate of Rp 62.43 trillion and revenues last year of Rp 45.53 trillion.

RHB Securities analyst Hariyanto Wijaya said, the trend continued with the company's business until next year are shown over the success of the realization of appropriate sales targets until October 2017.

From the heavy equipment sales, the company managed to sell as much as 314 Komatsu heavy equipment unit October 2017, compared to the same month last year as many as 218 units. The total sales from heavy equipments business from January-October 2017 reached 3,058 units or the equivalent of 86.9% of the targets set by RHB Securities sales as much as 3,520 units of heavy equipments.

"Based on the company's management estimates the demand for heavy equipment mining sector tends to rise until the end of next year. Depending on how the company's ability get the supply of heavy equipment from Komatsu principals to meet rising demand, "he writes in a research published in Jakarta.

Sunday, November 26, 2017

PP Presisi Tbk is targeting a rise in profit of 150% in 2018

PT PP Precision Tbk (PPRE) optimistic can achieve net profit of about Rp 500 billion (USD 37 million) in 2018, or jumped 150% from the estimated net profit in 2017 amounting Rp 200 billion. The company also had been able to get new contracts about Rp 7-8 trillion in the year 2018, compared to Rp 5.6 trillion this year.

Director of Finance PP Precision Tbk Benny Pidakso stated, the company already had an order book of $8.5 trillion until October 2017. Whereas since the beginning of the year, this new issuer is targeting order book can touch the Rp 10 trillion. Later, the targeted total sales reached Rp 1.8 trillion and net profit is expected to touch the Rp 200 billion at the end of 2017.

"With estimated sales and net profit targets can be achieved, surely the company accomplished the increase quite significantly in 2018. In addition to these indicators, both PP Precision believes its new contract, i.e. increase to Rp 7-8 trillion," said Benny in Jakarta, Friday (24/11).

While until October 2017, the company already had new contracts amounting to Rp 4.2 trillion. With this achievement, PRRE still require additional around Rp 1.4 trillion in order to fulfill the target of obtaining new contracts Rp 5.6 trillion in 2017.

Benny reveals, after the IPO (initial public offering/IPO), the company will have a more solid financial capabilities to strengthen the positioning of PP Presisi Tbk in the construction business.

The company with its subsidiary company, PT Lancarjaya Mandiri Abadi (LMA) was work on the Trans-Sumatran toll road project. In addition, both are also currently working on Pandaan-Malang toll road project, Manado-Bitung toll road, Solo-Kertosono toll road, Way Sekampung dam, Leuwi Keris dam project, and Sinabung lava control project.

"With the achievement of the performance is there, we believe it can keep its net profit margin in the range of 10-11% minimum," said Benny.

Financial Report
2015
2016
31 July 2017
Assets
378.545
1.066.389
3.355.267
Revenue
223.113
371.236
441.050
Equity
94.656
211.946
1.253.508
Liability
283.889
854.443
2.101.758
Net income
71.306
95.222
128.231
NB: In million Rupiah

Saturday, November 25, 2017

Ease Of Doing Business (EODB) in Indonesia

The hard work of the Government under the coordination of the Coordinating Ministry for Economic Affairs along with Indonesia Investment Coordinating Board (BKPM) in improving the ranking of the ease of doing aka Ease Of Doing Business (EODB) resulted in good results . Referring to the World Bank's EODB 2018 survey, Indonesia now ranked 72, experienced a very significant improvement goes up 19 ranks compared the position of 2017. That is, in the last two years the position of Indonesia has climbed 34 ratings.

Before 2017, rating EODB Indonesia was in the range of 116-129. In the report Doing Business 2018 entitled 'Reforming to Create Jobs', the World Bank noted Indonesia as one of the top reformer countries in Asia who did repairs 'ease of doing' by reforming the 7 indicators, namely starting a business, getting electricity, registering property, getting credit, paying taxes, tacross border trading and enforcing contracts.

The World Bank assesses Indonesia has achieved significant progress in some areas measured by Doing Business. With the 39 indicators adopted reform Doing Business for 15 years, Indonesia is one of top reformer in Asia.

The reforms have been conducted in Jakarta and Surabaya, two cities measured by the World Bank's report, there are a number of significant improvements. The cost of starting business made lower by from the previous 19.4 per cent to 10.9 per cent of per capita income. Now, to start a new business in Jakarta it takes 22 days, compared to 181 days in report Doing Business 2004.

Then, the cost of getting electricity connection is made cheaper by reducing the cost of connection and certification of internal wiring. The cost to get the electric connection is now 276 percent of per capita income, down from 357 percent per capita income.

In Jakarta, with the processing of requests for new connections, electricity is also more accessible. Get access to credit also improved with the establishment of new credit bureau.

Cross-country trade is facilitated by improving the system of electronic billing to taxes, customs duties and income tax. As a result, the time to acquire, prepare, process, and transmit the documents when importing down from 133 hours to 119 hours.

Registration of property made cheaper with the transfer tax reduction, thereby reducing the overall cost of 10.8 per cent to 8.3 per cent of the property value. Furthermore, the rights of minority shareholders reinforced with an increase in rights, increasing their role in company decisions, and increase the transparency of the company.

The head of the Indonesia Investment Coordinating Board, Thomas Lembong posited, "President of Joko Widodo on many occasions reminded the importance to continue to make improvements and ease of a trying endeavour included in the package of economic policy XII makes the various parties involved are working hard to realize this."

The economic policy package Vol I - XVI aimed for elimination of obstacles deregulated by  simplifying procedures, the acceleration of time service licensing and cost reduction as well as through the establishment of One-Door Integrated Service (PTSP) and licensing services through electronic systems (online) as well as law enforcement and business certainty. All this to be an effective instrument in encouraging the increase ranked doing business.

IPO News: WIKA Gedung offer 40 percent stake to raise up to US$ 61 milion

PT Wijaya Karya Bangunan Gedung (WIKA Gedung)(WEGE) subsidiary of PT Wijaya Karya (Persero) Tbk (WIKA), planning on doing an IPO (initial public offering) in October-November 2017. WIKA Gedung is ready to offer as many 40% stake to the public.

PT Wijaya Karya Bangunan Gedung Tbk (WIKA Gedung) was founded on October 24, 2008. The headquarter is located in the WIKA building, 8-10 floor, JL. A di Panjaitan Kav 9, Jakarta, Indonesia, 13340.

The scope of business activities of WIKA Gedung is engaged in the field of industrial construction and engineering services of chartering terms progress patterns as well as turnkey/Build Operate Transfer (BOT), the management and leasing of the building/area integrated commerce, trade and maintenance of the equipment as well as materials of construction and engineering in particular, developers realty, as property investors and industry supporters of the construction of the building.

WIKA Buildings position themselves as 'Total Solution Contractor' and always provide value-added solutions, best service in safety & quality. Currently WIKA Gedung focus on enterprise development through business transformation property towards investment and land concessions.

WIKA will conduct business development through backward integration approach to strengthen the supply chain or core business company (building construction), with the direction of business development include geotechnical solutions and prefab building. This effort made to increase revenues and profits, achieving economies of scale, as well as strengthen the competitiveness of the company long term.

WIKA Gedung pointed four guarantors of implementing emissions effect (joint lead underwriter/JLU), namely PT Mandiri securities, PT Bahana securities, PT CIMB Securities Indonesia, and PT Buana Capital Securities.

Based on the material of the IPO plan, schedule initial supply Wika (bookbuilding) on 24 October-7 November 2017. As for the initial public offering on November 22 - 24, and the listing at the Indonesia Stock Exchange (IDX) on November 30, 2017.

WIKA Gedung has complete the bookbuilding range set between Rp 290-456 per share.

The company will allocate 70% of the IPO proceeds to fund investment in the field of property and infrastructure. The remaining 30% for working capital of construction business.

As for the number of new shares issued as much as 2.87 billion units and the funds that would raise amounting to Rp 832.8 billion.

Currently, WIKA Gedung has a number of construction portfolio in the segment of apartments, hotels, malls, offices, airports and hospitals, educational buildings and sports facilities.

Meanwhile, in 2018, WIKA Gedung will increase production capacity to 25 units/projects per day. The capacity will be maintained in 2019 and 2020.

Financial Report

 

2015

2016

31 June 2017

Assets

1.231.900

1.682.858

2.194.925

Revenue

1.431.936

1.929.458

1.305.456

Equity

257.144

756.248

728.628

Liability

1.063.121

1.383.690

1.863.263

Net income

108.060

143.226

105.810

NB: In million Rupiah

Friday, November 24, 2017

PP Precision optimistic can get new contract worth Rp 8 trillion in 2018

PP Precision PT Tbk (PPRE), the biggest heavy equipment rental company in Indonesia,  is targeting a new contract worth Rp 7 trillion to Rp 8 trillion (USD 518-590 million) in 2018. As for the year 2017, a subsidiary of PT PP Tbk (PTPP) is targeting the contract amounting to Rp 5.8 trillion.

Benny Pidakso, Finance Director and Company Secretary PPRE stated, these new contracts include project multi years. Including the Trans-Sumatran toll, Pandaan-Malang toll road, and Solo-Kertosono toll road, built in 2017-2019.

In addition, there is the construction of the taxy way and runaway Soekarno-Hatta Airport's Terminal 3, and the construction Kulon Progo airport. "Until October 2017, PP Precision has signed a new contract worth Rp 4.2 trillion," he said in the Indonesia Stock Exchange (BEI), Friday (24/11).

For the year 2018, PPRE have budgeted capital expenditures or capital expenditure (capex) amounting to Rp 1.4 trillion. This capex lower than capex 2017 that reach Rp 1.8 trillion.

"Next year we are targeting is Rp 1.4 trillion. Due to the acquisition process for next year will not be as big as the year 2017. But we will focus to organic growth, "he said.

Currently, the company has the form work covering 27,000 sqm, eight factory of ready mix, and 1,500 units of heavy equipment from various famous brands.

Financial Report

2015
2016
31 July 2017
Assets
378.545
1.066.389
3.355.267
Revenue
223.113
371.236
441.050
Equity
94.656
211.946
1.253.508
Liability
283.889
854.443
2.101.758
Net income
71.306
95.222
128.231
NB: In million Rupiah

IPO News: PT PP Presisi Tbk. (PPRE.JK) predicted earn net profit Rp 132-182 billion in 2017

Based on the results of research of PT Bahana securities, PT Danareksa securities and PT Mandiri Securities as guarantors of implementing emission effects of an IPO (Initial Public Offering/IPO) shares of PT PP Precision Tbk (PPRE) the largest rental company of civil construction and building structure in Indonesia it is estimated to record a net profit margin of 8%-10% in 2017.

The highest achievement when compared with the average of other construction company which is about 4%-7%. Net profit will be achieved around Rp132-PP Rp182 billion at the end of the year 2017, an increase of 220% compared to the same period in 2016.

Subsidiary of PT PP (Persero) Tbk (PTPP) has a portfolio of projects across Indonesia and have competence in civil construction work or building structures with international standards. 

The civil construction work and the structure of the building contribute about 80% of the income of the company. "As a public contractor companies that have largest heavy equipment in Indonesia, the profit margin effect PP Precision will be much better. If the average contractor that the net profit margin of around 4%, a margin of PP Precision are 10%, .

Bahana securities, Danareksa securities, and Mandiri Securities also forecast a net profit margin of PP Precision would remain in the top 10% by 2018. The performance of the company's net profit was supported by a astonish income forecast to reach Rp1,6 trillion in 2017, grown 340% compared to the same period last year. The broad market share and heavy equipment support totaling more than 1,500 units of leading brands, such as Komatsu, Caterpillar, Liebherr, Hino, Sakai, and Kobelco became the company's competitive advantage.

This year, the company is targeting a new contract about Rp5 trillion comes from a wide range of projects, such as highways, bridges, wharves, airports, buildings, civil work and the structure of the building. As per July 31, 2017, PP Precision has gained new contracts amounting to Rp2,5 trillion. Plus the carryover last year amounted to Rp 4,9 trillion, meaning the company is currently working on projects worth a total of Rp10 trillion.

Financial Report

2015
2016
31 July 2017
Assets
378.545
1.066.389
3.355.267
Revenue
223.113
371.236
441.050
Equity
94.656
211.946
1.253.508
Liability
283.889
854.443
2.101.758
Net income
71.306
95.222
128.231
NB: In million Rupiah
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