H1 Underwriting Value Surges 13.81%

Wednesday, 30/06/2010 00:00 WIB

H1 Underwriting Value Surges 13.81%

Irvin Avriano A.

Bisnis Indonesia

JAKARTA: Several foreign securities firms dominate the stock and bond underwriting market, commanding a total value of US$6.51 billion or IDR59.89 trillion in the first semester of this year.

The underwriting value surged by 13.81% from US$5.72 billion or IDR52.62 trillion (assuming the rupiah exchange rate at IDR9,200 per US dollar) due to the relatively better market condition.

The underwriting market this year is seized by 38 securities companies. There are 59 issuances committed this year. Last year, 23 underwriters issued 56 bonds and stocks.

Vice President Investment Banking of PT Danatama Makmur Steffen Fang was optimistic the corporate action value conducted in the second semester of 2010 would be bigger than the corporate action in the first semester of 2010.

According to him, several factors would create positive sentiments for the domestic economy to help the capital market, motivating publicly listed companies and potential ones to seek financing from the capital market.

"Initially, last year we predicted the underwriting market value at only IDR10 trillion. But, thanks to the better economic condition in Indonesia, the prediction missed. The outcome turns out to be better than we expected and we have not put into account the second semester of 2010 here," he said yesterday.

Data by Bloomberg showed Barclays Capital seized the largest market share after underwriting US$933 million in bond issuance. The foreign investment bank underwrote US$666 million in T-bond, US$117 million in Star Energy Geothermal Wayang Windu Ltd bond, and US$150 million in Listrindo Capital BV bond.

Last year, Barclays also topped the market by seizing a market share of 30% after it underwrote US$1.72 billion in T-bond issuance, which included US$217 million in global Islamic bond.

Although the issuance value this year was US$790 million lower from last year, bond issuance last year was dominated more by T-bonds.

The first position last year was held by Danatama Makmur, which found its performance boosting after underwriting PT Bakrie & Brothers Tbk medium-term notes.

Data also showed Danareksa Sekuritas, Indo Premier Securities, and Danatama Makmur, underwrote US$210 million in bond issuance in the first semester this year.

Research analyst at PT Majapahit Securities Tbk (formerly known as PT Asia Kapitalindo Securities Tbk) Arga Pradita Sutiono viewed the high number of corporate IPOs in the second semester of 2010 was attributable to delays in the IPOs last year when the stock exchange was resurgent.

"This also raises the question why there were few IPOs when the stock exchange rebounded last year?

According to him, that was attributable to the absence of corporate actions from the existing publicly listed companies. (Bisnis/iaa/pul)