PT Campina Ice Cream Industry (CAMP) 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.
