Monday, 23 March 2015

Adhi Karya IPO property subsidiary in 2016.
Adhi Karya (ADHI) plans to merge two of its property subsidiaries – Adhi Persada Realti (APR) and Adhi Persada Properti (APP) – in preparation for ADHI’s IPO plan of its property business. APR engages in the development of high-rise buildings while APP engages in the development of landed houses. ADHI is aiming to divest a maximum of 30% ownership from its property business. As of Dec 14, APP contributed 7.7% of ADHI’s total consolidated revenue, which translates to Rp663.6b, while APR contributed 2.3%. High demand of low-to-middle segment apartment in Jakarta is the main driver of the significant 30.7% yoy growth in APP’s revenue in 2014.

Chandra Asri Petrochem net profit grew 86.4%.
Chandra Asri Petrochemical (TPIA) booked net profit of US$18.05m, up by 86.4% yoy from US$9.68m. The company reported slightly lower revenue growth of 1.9% yoy from US$2,506.4m to US$2,460.1m. The overall margins of the company were better than that the previous year’s as the company booked a gross margin, operating margin and net income margin at 4.8%, 2.0% and 0.7% respectively compared with 2013’s margins of 3.9%, 1.2% and 0.4% respectively. The improvement of margin is due to the 2.7% yoy decline in cost of goods sold as well as a 17.8% yoy decline in forex losses to US$3.6m.

Electronic City: Prepares capex of Rp200b in 2015.
Electronic City (ECII) plans to add another seven stores in 2015, and has prepared a capex of Rp200b to carry out this plan. The first four stores will be opened in 1H15 while the other three stores will be launched by 2H15. Based on ECII’s calculation, it requires a launching cost of Rp4m-5m/sqm to open a new store in a mall and a cost of Rp8m- 9m/sqm for a stand-alone new store. As at Feb 15, ECII had opened two stores in Cirebon which are located in Kagum City Mall and Grage City Mall. As of Feb 15, ECII was running 69 total stores. Besides opening the new stores, ECII also renovates its old stores on a regular basis. This year, the company estimates that Indonesia’s electronic retail industry will grow by only 4-5%, considering the lack of infrastructure support, weakening of Rupiah against US Dollar and political instability.

Garuda loans of Rp2.6t.
Garuda Indonesia (GIAA) has obtained loans of Rp2.6t from BII- Maybank. The loans consist of Rp1t of Rupiah and US$100m of US Dollars. The loans has tenor of 1 year with interest rate of 7.8% for Rupiah loan and LIBOR+3% for US dollar-denominated loan. The Rp1t loan will be used to refinance its previous loans and payment of aviation fuel to Pertamina, while the US$100m US$ loan will be added to bridging loan. The company plans to issue global bonds to pay off the loan to BII- Maybank.

United Tractors: Conducts a mandatory tender offer on Acset.
PT Karya Supra Perkasa, a wholly-owned subsidiary of United Tractors (UNTR), will conduct a mandatory tender offer on shares of Acset Indonusa (ACST). The mandatory tender offer will be conducted for a maximum of 159m shares owned by the public shareholders of ACST, or about 31.8% of total outstanding shares. The tender offer price is set at Rp3,250/share, ie the takeover price. The total value of mandatory tender offer is a maximum of Rp516.8b. The mandatory tender offer period is from 24 March to 22 Apr 15.

Founding PM Lee Kuan Yew passed away peacfully.
Lee Kuan Yew, who founded modern Singapore and admired for turning the city-state into one of the world’s richest nations, has died Monday. He was 91. The Prime Minister’s Office said that Lee “passed away peacefully” at the hospital at 3:18 am Monday. President Barack Obama called Lee “one of the legendary figures of Asia in the 20th and 21st centuries.” U.N. Secretary-General Ban Ki-moon noted that Singapore is marking its 50th anniversary of independence this year, and “its founding father will be remembered as one of the most inspiring Asian leaders. Ban said Lee helped Singapore “transition from a developing country to one of the most developed in the world, transforming it into a thriving international business hub.”

Tuesday, 24 March 2015

Link Net launch Fast Net with speed of 200Mbps.
Link Net (LINK) will start to launch the new line of Fast Net with internet speed of 200Mbps by 2H15. LINK had previously launched the first generation of internet services in 2013 with speed capacity of 100Mbps. LINK has prepared a capex of Rp1.5t in 2015 for the expansion, research and development and home pass extension. LINK is targeting 1mn new customers this year.

Mitra Keluarga IPO oversubscribed by 10 times.
Mitra Keluarga Karyasehat’s (MIKA) IPO has been oversubscribed by 10.3 times. The company has offered to sell 261.91m shares or 18% of stake to the public at a price of Rp17,000, but the demand is more than Rp45t. About 99% of demand comes from the institutional investors while the rest comes from the pooling of retail investor. Foreign investors dominate the total number of buyers, accounting for 53% while domestic investors account for 47%. MIKA Of the total Rp4.45t in IPO proceeds, MIKA will use it as follows: a) about 56% will be used to build new hospitals in Jabodetabek and Surabaya, b) about 16% will be used to acquire land, c) 20% will go towards buying new equipment and medicals supplies, and d) 8% will be used to increase the hospital capacity. The stock plans to be effectively traded by today (24 Mar 15).

Waskita Karya: To launch two precast factories by 1H15.
Waskita Karya (WSKT) plans to focus on its precast concrete business by building another two precast factories in Karawang and Sidoarjo which will start operations by end-1H15. The Karawang and Sidoarjo precast factories have capacities of 400,000 tonnes/year and 300,000 tonnes/year respectively.

Bahasa proficiency test dropped.
Indonesia will withdraw a plan that would force foreign workers to take local language proficiency exams after protests from investors. Coordinating ministers agreed last week that the planned regulation would be dropped. A second government official confirmed that the plan for language tests would be withdrawn after “many people complained, including domestic investors who said they needed foreign expertise.”

GIC partnership in logistics properties.
Singapore’s sovereign wealth fund GIC said it has set up a 300 million euro ($324 million) partnership with Exeter Property Group, a real estate investment manager, to invest in logistics properties in key European distribution hubs. Over the long term, there will be an increasing demand for logistics space in these locations due to the growing trend of e-commerce, supply chain reorganisation and the increased use of third party logistics providers

Tributes from world leaders.
World leaders have paid tributes to Singapore’s first Prime Minister Lee Kuan Yew on the occasion of his passing. Prime Minister David Cameron said Mr Lee’s “place in history is assured”, while his predecessor Tony Blair said Mr Lee was “the first to understand that modern politics was about effective government not old-fashioned ideology”. Australian Prime Minister Tony Abbott paid tribute to Mr Lee, whom he described as a “giant in our region”.  Former Australian Prime Minister Kevin Rudd also sent his condolences, saying that Mr Lee was a “rare statesman”. India Prime Minister Narendra Modi has offered his condolences and said Mr Lee is “a far-sighted statesman and a lion among leaders, Mr LKY’s life teaches valuable lessons to everyone.” China’s President Xi Jinping praised Singapore’s founding prime minister LKY as an “old friend of the Chinese people”. Mr Xi said Mr Lee was “widely respected by the international community as a strategist and a statesman” and expressed “sincere condolences”.

Wednesday, 25 March 2015

Bank Negara Indonesia: Aims for market cap of Rp200t.
Bank Negara Indonesia is aiming for a market capitalisation (market cap) of Rp200t over the next five years from the current market cap of Rp131.9t. In order to achieve this target, the company is committed to performing above the industry. However, for this year, the company is only targeting credit growth of 14-16% yoy and the third-party funds growth of 13-16% yoy due to the unstable economic conditions. The new management will not change the focus distribution of the credit portfolio of the company.

Bank Tabungan Negara: Seeking funds of Rp7.5t.
Bank Tabungan Negara (BBTN) is seeking funds of Rp7.5t by planning to issue continuous bonds (PUB) II worth Rp3t and issue collective investment contract assets-backed securities with value of Rp3t, and to add Rp1.5t , which are the proceeds from issuance of negotiable certificate of deposit (NCD) in February.

Garuda global bonds worth US$500m.
Garuda Indonesia (GIAA) plans to issue global bonds worth US$500m in May 15. There are 12 foreign banks that have expressed their interest in becoming the joint lead managers and joint bookrunners to issue the global bonds of company. The banks have stated that there has been US$800m of hard commitment to be collected, but the total bonds to be issued amount to US$500m. The proceeds from the bonds will be used to refinance its debt of US$350m that will mature in Jun 15.

Presidential regulation to enhance land acquisition process.
The government has amended some terms on the previous Presidential Regulation No.71/2012 on land acquisition process for infrastructure developments with the new Presidential Regulation No. 30/2015. Under the new regulation, the government allows and encourages private companies to acquire land for infrastructure developments. The private companies can then redeem the land acquisition costs to the government when evaluating total investments needed for that particular project. Alternatively, the land acquisition costs can also be translated into longer concession periods as well.

ADB positive on Indonesian economy.
The Asian Development Bank (ADB) has painted a positive picture of the Indonesian economy this year, arguing that the government’s policy reforms will have an impact on economic growth sooner than expected. The ADB forecast Indonesia to grow by 5.5 percent this year and 6 percent in 2016, far more optimistic than estimates from the World Bank and the International Monetary Fund (IMF), which said the economy would grow by 5.2 percent this year. The World Bank cut its projection for this year’s economic growth to 5.2 percent from 5.6 percent due to the weak outlook for fixed investment and trade as well as the slowing pace of loan expansions.

Jokowi conveyed “deep sorrow” for Indonesia.
President Joko Widodo expressed his “deep sorrow” on behalf of the Indonesian government and people. He said the late former PM is a close friend of Indonesia, and founding father of modern Singapore. As a leader and a great statesman who loved his people, he was also one of the most influential politicians in Asia. Under his leadership, Singapore successfully transformed into a major economic hub in Asia, putting it on a par with other developed nations. VP Jusuf Kalla described Mr Lee as having made “an outstanding contribution to Singapore”. And rank him among the most influential leaders of Asia.

Thursday, 26 March 2015

Ciputra Surya marketing sales growth of 56% in 2015.
Ciputra Surya (CTRS) aims to book 2015 marketing sales of Rp2.83t (+56.3% yoy) from 2014’s Rp1.81t. The company believes that strong marketing sales this year will be mainly driven by: a) residential project in Jayapura-Papua, which will be launched in Jun 15, b) the project in Kendari, which will be launched in Aug 15, c) the project in Lampung, which will be launched at end-15. Besides, the company is now finalising the development license of its 157ha residential project in Makassar.

Pakuwon Jati revenue increased by 28%.
For 2014, Pakuwon Jati’s (PWON) revenue increased by 28% yoy from Rp3t to Rp3.8t with net profit growth of 30% yoy from Rp1.1t to Rp1.4t. About 46% of the revenue came from the recurring income and 54% came from the development revenue. Recurring income grew by 25% yoy while development revenue grew by 31% yoy from 2013.

Higher mortgage payments with interest rate hikes.
Many home owners in Spore face higher mortgage repayments after a key interest rate that determines housing loans surged to a level not seen since December 2008. The three-month Singapore Interbank Offered Rate, or Sibor, hit 1.00129 per cent yesterday – up about 23 per cent since March 6. It is also more than 118 per cent higher since the start of the year, when it was 0.45738 per cent. That is still low by historic standards: It hit a high of 3.56214 per cent on July 31, 2006. The rise signals that mortgage repayments are on the way up as many home loans are pegged to the three-month Sibor, so they rise and fall in tandem with it.

Clinton leads US delegation to Spore.
United States President Barack Obama announced that a presidential delegation will travel to Singapore to attend Mr Lee Kuan Yew’s State Funeral Service on Sunday. Tributes have been pouring in from US leaders after Mr Lee’s death, as a testament to the former Prime Minister’s efforts to promote Singapore-US relations, decoding Asia for Washington and contributing to regional peace and stability. Former US President Bill Clinton will lead the delegation. Members of the presidential delegation include US Ambassador to Singapore Kirk Wagar, former US Secretary of State Henry Kissinger, former US Ambassador to Singapore Steven Green and former Assistant to the President for National Security Affairs Thomas Donilon.

Friday, 27 March 2015

Bumi Serpong non-preemptive right issue to raise Rp1.7t.
Bumi Serpong Damai (BSDE) has advertised its corporate action in Bisnis Indonesia daily today on executing a Non-Preemptive Right Issue (NPR) Phase II by issuing 874,849,800 new shares at price of Rp1,890 and is expected to raise total funds of Rp1.7t. After the NPR, total outstanding shares would be 19.3b shares, up from current number of shares of 18.4b. The NPR was executed on 25 Mar 15 and will be listed in the exchange on 14 Apr 15.

Siloam Hospital: Net profit of Rp62.6b below forecast.
Siloam International Hospital (SILO) reported net profit of Rp62.6b, up by 25.5% yoy which 16.6% below our forecast and 10.4% below the market. The company announced revenue of Rp3,340.8b, up by 33.4% yoy from Rp2,503.6b which is below market forecasts.

Surya Semesta Internusa: To sell industrial landbank of Rp108b.
Surya Semesta Internusa (SSIA) recently sold a 5.4ha piece of industrial land amounting to Rp108b, which is equivalent to 9% of the targeted landbank sale in 2015. The landbank is located in Karawang or Industrial State of Surya Cipta Swaraya with ASP of US$155/sqm. Previously in 2014, SSIA booked 60ha of industrial land sales or almost triple from 2013 land sales of 22.8 ha. SSIA is targeting to acquire more land of up to 500ha in 2015 and has prepared a capex of Rp400b which will be financed internally.

Fuel (BBM): Fuel price could rise sharply.
Fuel prices (BBM) could potentially rise in Apr 15, on the back of the increase in Mean of Platts Singapore (MOPS) and the weakening rupiah, which have caused an increase to the fuel economical prices. According to Pertamina’s calculation, the economical price of gasoline is about Rp8,200/litre and the diesel oil is about Rp7,450/litre. The calculation is based on market index price formula, tax on motor vehicle fuel use (5%), value added tax (10%), distribution cost and margin.

Bloomberg upbeat on Indonesia growth.
Bloomberg chairman Peter Grauer is upbeat about the growth potential in Indonesia. The areas they would focus on revolved around the mutual fund market, and their Instant Bloomberg Dealing platform in the forex market. They have also expanded their news footprint to cover local news better.

SingCham businessmen & professionals pay tribute.
Singaporean businessmen and professionals in Jakarta gathered on Thursday to pay their tributes to Mr Lee Kuan Yew. Many said being away from Singapore made them appreciate more of what Mr Lee had done for the country. More than 100 Singaporean businessmen and professionals turned up at a special tribute. It was organized by the Singapore Chamber of Commerce Indonesia. Many could not hold back their tears as they watched TV documentaries on Mr Lee screened on Channel NewsAsia.

International corporate tributes.
Many individuals and companies took to social media to pay tribute to Singapore’s founding PM who passed away. While most local companies changed their logos on their websites to a respectful grayscale shade, many were also surprised and heartened when international brands took the cue to stand in solidarity with Singapore. Some of the companies include: Carlsberg, Citibank, 20^th Cebtury Fox, Disney, IBM, McDonald’s, Nestle, Reebok, Samsung, and Visa.

Track & Field meet re-scheduled.
The 77th Singapore Open Track & Field Championships 2015, originally scheduled for the weekend of 28 and 29 March 2015, will now be staged on 4 and 5 April at the Singapore Sports Hub’s National Stadium. The postponement is due to coinciding with the national mourning period.