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Thursday, January 13, 2011

Garuda offers shares' price at IDR750--1,000

BI/Bourse
12/1/2011
Irvin Avriano A.

JAKARTA: PT Garuda Indonesia Tbk offered price range for their listed shares at IDR750--1,050 level per shares in the initial public offering (IPO) process that has been going.

Analyst said the range will be attractive to the retail investors, especially when the state owned enterprise (SOE/BUMN) commercial air transport company set up the price below IDR1,000 level per share.

"Retail investor look alike will absorb the new emitters' shares," said PT Citi Pacific Securities Head of Research Hendry Effendi to Bisnis yesterday afternoon.

He expect the shares will attract more investors than the previously listed SOE, PT Krakatau Steel Tbk, because the commercial air transportation sector is 'closer' to public than the steel producer.

But he can not calculate the range of Garuda's share fair price yet because the company haven't been disclose their financial historic number or forecast in the public expose that been held last night, clearly.

Capital market observer Adler Haymans Manurung said the fair price of the new shares is at IDR850 level, that will give potential price upside to IDR1,000 level at the share's listing day.

"The fair price was IDR850, if they set the price at IDR1,000 then it doesn't have a potential upside."

Previously Restructuring and Privatisation Deputy for SOE Minister Achiran Pandu Djajanto assured that retail investor and pooling fund pooling in Garuda's IPO will bigger than Krakatau Steel's IPO portion.

He said the bigger portion caused by government intention to make the company more lovable for the public and it can boost Garuda's operational and financial performance.

"We hope the local portion can be high, maybe 80%, but we can't exclude the foreign investors because the foreign buying can be used as a success selling indicator."

Garuda Acting Financial Director Elisa Lumbantoruan added the company intend to spend US$1.3 billion to upgraded their fleet quality that can jacked up their operational performance in the next five years.

"Especially to renewed our planes."

Garuda eyes to join the Skyteam flight companies that can attract more countries to be served. They also intend to add planes for their low cost airways, Citilink, to reach lower segment in local flight to 25 planes from 6 planes that runs at this time.

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