Indika intends to issue US$230 million bonds

Kamis, 22/10/2009 00:00 WIB
Indika intends to issue US$230 million bonds
Fitch gave B+ rating to the new bonds

JAKARTA: PT Indika Energy Tbk plans to issue US$230 million bonds or IDR2.18 trillion to cover capital expenditure particularly to develop PT Petrosea Tbk.

An informed executive said the bond issuance will be done through the subsidiary firm, Indo Integrated Energy II BV with Citi as the underwriter.

The bond is guaranteed by Indika Energy and other subsidiary firm, PT Indika Inti Corpindo. "Today Indika is scheduled to have road show on bond issuance abroad," he said to Bisnis yesterday.

Indo Integrated in April 2007 issued US$250 million bonds with 8.5 percent coupon per year. The sales of five year tenure bonds is assisted by ING and JP Morgan Securities.

Vice President & Investor Relations of Indika Energy Retina Rosabai was not available for comment on it.

Bond analyst of PT Trimegah Securities Tbk Octavianus Bramantya considered the US dollar denomination bond issuance will not hamper the similar issuance of some other emitters this year.

"The global bond has unlimited investors basis and thus it would be better if the market is not limited to regional ones but also to Asia, Europe, and America."

The institution fund like investment manager, hedge fund, private equity, and other global investor remain fairly significant if compared to the regional and domestic markets.

The inflow of foreign investors particularly from advanced to the developing countries following the low interest rate which could succeed the bond sales and other corporate.

Fitch Ratings today upgraded the rating of the long term foreign and local currencies of Indika Energy from B to B+ with stable prospect.

Fitch also rose the senior bond rating worth US$250 million matured by 2012 along with the expectation rating of B+ to the scheme of Indo Integrated Energy II bond issuance.

The growing rating reflected the soaring dividend significantly from PT Kideco Jaya Agung, the third largest coal debtor nationwide with its 46 percent shares are owned by Indika worth US$90 million in 2008 become into US$210 this year.

Fitch estimated the dividend will remain high value and stable as seen by the high coal price now and Kideco scheme to increase the production into 31 million tons by 2011 as from DIR22 million tons last year.

But Indika rating is still restricted to the status as holding company which gets some cash flow from dividend by Kideco.

The restriction could be mitigated with the agreement made by Kideco shareholders which ensure that all Kideco free cash flows will be distributed as the dividend and Kideco has got no debt.

The rising rating of the corporate also considers the acquisition of Petrosea which makes Indika business complete.

By end of June 2009, Indika had IDR2.5 trillion cash (excluding short term investment and cash with limited use).

Bond issuance will grow the corporate cash. The management plans to have expansion on energy sector.

Fitch predicted most corporate cash will be budgeted for the acquisition of energy sectors.

Stable prospect reflected the expectation of Fitch that Indika could maintain the loan profit with the support given by the cash flow growth despite the new debt. (Bisnis/wiw/21)

Bakrieland targets IDR2 trillion from the subsidiary firm divestment

Kamis, 22/10/2009 00:00 WIB
Bakrieland targets IDR2 trillion from the subsidiary firm divestment

JAKARTA: PT Bakrieland Development Tbk aims to tap some IDR2 trillion from the subsidiary firm divestment in three business sectors next year. Each sold shares 30 percent at maximum.

President director of Bakrieland Development Hiramsyah S. Thaib said the three sectors to be sold here include hotel and resorts, city property , and toll road. The company has studied to lure Middle Eastern, US, Australia, and British new investors which was initiated from the road show to London and New York.

"The scheme stipulates better economy condition," he said to the press yesterday.

The company has five business sectors, namely hotel and resort, city property, toll road, landed residential, and also water treatment that comprising 13 companies. From city property, Bakrieland has three subsidiary firms, PT Bakrie Swasakti Utama, PT Bakrie Bangun Persada, and PT Bakrie Pangripta Loka.

Five subsidiary firms in hotel and resorts include PT Samudera Asia Nasional, PT Berkah Puhu Lestari, PT Krakatau Lampung TD, PT Libratindo Gemilang, and PT Bali Nirwana Resort. From landed residential sector, the company has PT Graha Andrasentra, PT Dutaperkasa, and PT Mutiara Permata Biru.

The other subsidiary includes PT Semesta Marga Raya for toll road. Meanwhile, PT Aetra Air Jakarta is the subsidiary firm of Bakrie for water treatment sector.

Following the issuance of bond I/2008 and I/2009 sharia bond, the company also opened options for the similar bond issuance when the interest rate and yield of the government bonds are still low like now.

In the future the research released by August 31, analyst of JP Morgan Chase & Co Stevanus Juanda increased the estimated price loss into IDR530 in the next 12 months. The price rosen from Rp500 level. (Bisnis/21)

Bapepam-LK probed Aqua

Rabu, 21/10/2009 00:00 WIB

Bapepam-LK probed Aqua

EGMS plan suspension potentially hampers go private plan

JAKARTA: The Capital Market and Finance Institution Supervisory Agency (Bapepam-LK) probed PT Aqua Golden Mississippi Tbk due to the indication of violation committed by the corporate management.

An informed executive said there is shareholder reporting the alleged irregularity resorted by Aqua dealing with the tender offer price of IDR450,000 per share unit.

Based on the documents and evidences handed over by the shareholder, Bapepam-LK involved in further investigation. "As to them (shareholders), the tender offer price was higher (than the fair price). Bapepam-LK found some things need investigating," he said to Bisnis Monday.

Other Bisnis resource said the case now has been under the investigation of Bapepam investigation bureau as authorized by the Bapepam's real sector company finance assessment bureau.

When asked, Investigation Bureau Chief of Bapepam-LK Sarjito conceded the case investigation. But he declined to unveil the detail of the investigation conducted by the bureau. "We are in process," he said.

The probe will eventually lead the Aqua management to suspend the extraordinary general meeting of shareholders (EGMS) on go private and Aqua voluntarily delisting agenda which should have been scheduled on October 13.

"The management called for the suspension of EGMS upon regarding the existing internal matters," said a resource who declined to mention his name.

But Corporate Secretary Theresia L. Setionegoro refused to comment. "Just call me another day."

Aqua made another plan to become go private when 2001 and 2005 failed to get approval from public shareholders. In December 2005, public shareholders disapproved the management tender offer price proposal. The IDR100,000 tender offer price was deemed too low.

Now, to materialize the ambition, Aqua should obligatorily buy 743,383 public shares or 5.65 percent of the total shares issued by the company through tender offer.

On September 8, Aqua announced tender offer price of IDR450,000. The price reflected the premium of 83.82 percent from the top price at market in the past 90 days.

Aqua shares was traded at the last time on June 4, 2009 on the level of IDR244,800 following the jump rise of 20 percent or IDR40,800 from previous transaction.

Indonesia Stock Exchange suspended the Aqua stock trade since session I June 5 due to the go private scheme of the bottled mineral water producer here.

Johanes Soetikno, one of Aqua shareholders who is also member of the Indonesian Securities Investor Community Expert Boards (MISSI/Masyarakat Investor Sekuritas Seluruh Indonesia), considered the tender offer price was proper with doubled upper than the market price. "If it could be IDR500,000 it would be better. But the offer is good. I guess I would take the offer here," he said recently. (Bisnis/pul/21)

Yudhoyono's Cabinet II immediately announced, the price of SUN allegedly stable

Tuesday, 20/10/2009 10:51 WIB
Yudhoyono's Cabinet II immediately announced, the price of SUN
allegedly stable
by: Irvin Avriano

JAKARTA (Bisnis.com): The price of bonds (SUN) predicted will be stable in the next two days, given the government's cabinet immediately announced tomorrow, with a potential decrease in thin ahead of the debt securities auction this afternoon.

The government plans to auction three series of its debt with the indicative target of Rp3 trillion this afternoon. Series is offered SPN20101007 due on 07 Oktober 2010, FR0040 maturing 15 September 2025, and FR0052 which will mature on August 15, 2030.

Bond analyst PT Kim Eng Securities Dian Abdul Hakim said that although there are indications the government's economic team of ministers deemed appropriate market expectations, predicted traffickers continue to try to lower prices today.

The decrease in price will cause the value of increased yield and make the price at the SUN will terdiskon auction.

"Principals have the market's expectations when YTM [yield to maturity/yield in the secondary market] is going through the increase and considered a natural YTM, then the chance of getting relatively cheaper price will be greater," he said in a research company that received Bisnis.com this morning.

He explained that predictions are not taken based on the demand bidders in the auction sharia state bond securities (SBSN/sukuk) last week. At the auction, the government did not take the offer because the required yield is too high from the government's target.

According to him, optimism ahead of the inauguration today is not enough to make market participants retain ownership of the instruments in the short term SUN on trading yesterday.

Bond analysts PT Bank Danamon Indonesia Tbk Helmi Arman predict at auction today will yield the government released for SPN20101007 series revolves around the level of 6.85% -7%. FR0040 series will be released at the level of 10.45% -10.6%, and FR0052 series at the level of 10.55% -10.7%. (Er)

Reliance to switch IDR100 billion portfolio

Senin, 19/10/2009 00:00 WIB
Reliance to switch IDR100 billion portfolio

BOGOR: PT Reliance Securities Tbk will ask for the shareholders' permission to switch their IDR100 billion's worth investment portfolio to shares in companies in the banking sector.

Therefore, the company will hold a Shareholders' General Meeting (RUPS/rapat umum pemegang saham) on November 10, 2009.

President Director of Reliance Securities Orias Petrus Moedak revealed the company intended to switch their investment funds.

"Most of our investments in shares have realized profit since early this year," he told the press last weekend.

He said the company viewed shares in the banking sector would still be potential to give huge returns in the long term.

However, Orias declined to mention the names of the banks whose shares Reliance planned to buy or to mention the names of the companies from which the investments would be switched.

The company has shares in several companies, such as PT Kawasan Industri Jababeka Tbk and PT Sentul City Tbk (PT Bukit Sentul Tbk).

According to him, the company had asked the the Capital Market and Financial Institution Supervisory Agency's (Bapepam-LK) about the necessity of RUPS to get permission.

The capital market authorities, he added, indicated there was no need to hold RUPS. Nevertheless, the company still wanted to hold the meeting to maintain good relations with its shareholders.

The company until the third quarter of 2009 was able to increase its amount of cash balance to IDR120 billion.

In addition to switch investment portfolio, the company also plans to ask for its shareholders' permission to issue bonds worth IDR125 billion this year.

The amount of fund will be allocated to grow online trading that the company has developed since last year.

Orias said the company hoped the bond could be underwritten by PT Danareksa Sekuritas and PT Victoria Securities. He explained the two securities companies once underwrote Reliance Securities' IPO.

The company just planted 400 trees on 1 hectare of land at Gunung Gede-Pangrango National Park that donated part of the sale of retail T-bonds (ORI/obligasi negara ritel) series 006. The company sold the debt securities worth around of Rp170 billion.(Bisnis/21)

More secure with dollar cost averaging

Sunday, 14/06/2009
More secure with dollar cost averaging

by: Irvin Avriano (21)

You may be tempted by the rise of stock price of Indonesia Composite Index (JCI) when hit return about 70%, the price index of government bonds (SUN/surat utang negara) up to 35% measuring from the lowest point in October last year.

For a moment the numbers are very tempting you to invest immediately. However, you should not attracted instant games and mess around with the gain. "Do not completely rely on the timing of investment, also apply to the dollar cost averaging [DCA] because it can be more profitable," said President Director of PT Manulife Aset Manajemen Indonesia Denny Thaher reminded.

DCA is a tactic to invest in stages with the same amount on a regular basis and requires investors to be discipline, as not to allocate large funds at just in one time (lump sum). The investment strategy designed to reduce volatility in which securities, fixed amounts at regular intervals, regardless of what direction the market is moving. Thus, as prices of securities rise, fewer units are bought, and as prices fall, more units are bought. also called constant dollar plan.

If the customer allocate capital in large numbers once in a basket of investments, Denny said, the potential gain (profit) and risk that investors will be bearer.

That is contrary to the allocation of investment along with the gradual, so that customers do not need to take the unit prices or conditions around, yet the long-term investment, right?

Some banks and investment managers (MI/manajer investasi) has started implementing a program run DCA, a regular automatic investment. Denny adds, Manulife Asset Management also intends to launch the program next August. Value of first installment to be made minimal, and some have reached Rp100.000.

The program does not advise investors to add to your mutual fund units in large numbers, it only needs sufficient funds from your savings account with restrictions that have been adapted to the prospectus.

The amount of funds that are added regularly to the open-ended mutual funds that have been owned by investors, will be uniformed, as well as the appointed date of the investor himself.

Similar to a savings plan, additional units will be purchased from the funds in savings accounts. The fund is automatically debited with the amount already set on the date you have set yourself.

Beside Manulife, there are at least five mutual fund dealer who is providing the facility for its customers.

They are Danareksa Investment Management with the programs 'Investasiku Masa Depanku', Citibank NA to 'Citi Regular Investment Plan (CRIP), Commonwealth Bank with 'Regular Investment ', Bank Permata is 'Spend & Save', and Bank Mandiri with 'Investment Plan'.

Head of Investment Service Bank Permata Karma Perkasa Siregar said the company had started the program 'Spend & Save' with Fortis Investments mutual fund Indonesia through Fortis Equitra since a year ago.

Private banks are set first purchase the same unit with the addition of further units in the amount of Rp500.000, the relatively small for those who want to invest regularly.

He said in an investment with these techniques, investors can benefit from it when the value of mutual fund units declined. "With the DCA technique that unit would have bought more bullish than the conditions of [strength]."

Attract customers
Danareksa Investment offers future investment programs with a minimum investment value Rp200.000. In fact, a minimum bid that the product before purchasing Rp1 million. "It is expected that customers will invest more," said Head of Marketing Danareksa Investment Diah Sofiyanti. Unmitigated, six mutual fund companies are ready to apply by the program.

Wealth Management Group Head, Bank Mandiri Inkawan D. Jusi said that the company had applied DCA techniques to the program's new Installment Plan socialized early this year. This program, he said, allows customers who usually have to come to the bank wanted to increase the amount of each investment.

Bank Mandiri offers 27 pieces from seven mutual funds that make the MI state bank is a mutual fund dealer.

According to him, enough with the first installment of Rp500.000 generally for a mutual fund, investors can invest regularly units minimum purchase, usually at least Rp100 thousand, depending on the minimum purchase in the prospectus.

Citibank has also prepared program'Citi Regular Investment Plan (CRIP). This program highlights the ease of recommendations for the client to allocate its investments in several capital market investment assets, namely stocks, bonds, and money market.

"Jump is detected when the customer fill out a risk profile, they are encouraged to invest into the type of investment asset, not mutual funds, and we monitor it every time," said Head Investment of Citibank Harsya Prasetyo.

Another with the ease at which Commonwealth Bank offers Regular Investment programs. The program enables customers to invest in more than 50 open-type mutual funds from 10 MI private bank clients are.

According to Head of Wealth Management Commonwealth Bank Rian Kaslan, the program can also be accessed via the Internet, so customers just enough time corresponding to open investment accounts in the branch office.

To facilitate customers to allocate funds, DCA system can be implemented with the help of my program which is managed portalreksadana.com plan, a community owned non-profit sites mutual fund investors.

"It's easy, just sign up to the site and enter the targets of long-term investment in my plan," said the initiator of the site, Adityo Hidayat.

According to Denny Thaher, DCA applications through investment programs in several banks potentially become the core of the mutual fund industry. So, when banks and others following MI? (redaksi@bisnis.co.id)

Government cancels Islamic bond issuance

as published in Bisnis Indonesia daily newspaper

Wednesday, 14/10/2009 00:00 WIB

Government cancels Islamic bond issuance

JAKARTA: The government didn't absorb at all subscription made by the bidders at the auction for Islamic T-bond series IFR003 and IFR004 yesterday, leading to the cancellation of the bond issuance. The amount of subscription to the Islamic T-bonds reached IDR5.08 trillion.

The government planned to issue two Islamic T-bonds series IFR003 and IFR004 through auction yesterday and targeted to raise IDR1.5 trillion fund. IFR003 is a six-year bond, while IFR004 is an 11-year bond. Previously, the government issued Islamic T-bond series IFR001 and IFR002 last year through book building.

Director General of Debt Management Office at the Ministry of Finance Rahmat Waluyanto revealed the government didn't absorb the subscription since the average yield asked was above the yields of T-bonds in the secondary market.

"We have some reasons for not absorbing the subscription. One of the reasons is the relatively higher cost due to the high yield asked," he explained yesterday.

At the auction, the bidders recorded a total subscription of IDR5.08 trillion. The lowest and highest yields they asked for Islamic bond series IFR003 are 9.75% and 11.5%, respectively, while the lowest and highest yields they asked for Islamic bond series IFR004 are 10.5% and 12%, respectively.

Albeit declining to expose the yield expected by the government, Rahmat admitted the bid made by the Islamic financial industry was relatively smaller than that made by the conventional one.

He hoped the next auction would be able to attract more interests from the Islamic financial institutions.

According to Rahmat, the government was not worried with the cancelled bond issuance since T-bond issuance this year had reached 90% of the target. In addition, he inserted, the government had other debt instruments, such as Indonesian hajj [pilgrimage to Mecca] fund certificate (SDHI) and standby loan.

Director of Islamic Financing at the Ministry of Finance Dahlan Siamat said the government still intended to put into auction similar Islamic bonds this year.

According to him, auction enabled the government to save more money compared to bookbuilding.

Dahlan also admitted many market players asked the government to put into auction the Islamic bond already issued, so that Islamic debt securities trading in the secondary market would be more upbeat. However, he added, the government could not grant the request since Islamic T-bond series IFR001 and IFR002 prices in the secondary market had been too high.

"We cannot sell the bonds if the prices have already been too high in the market. If we force to sell the bonds, it will affect the already good price in the market." (Bisnis/21)