Tuesday, May 7, 2013

ADHI will lead consortium to build 3 monorail projects

ADHI to lead monorail project. ADHI will lead 8 BUMN (State-Owned Enterprises / SOE) consortium to build 3 monorail projects worth of IDR 12 trillion, where IDR 8.4 trillion will be financed by bank loan. On ADHI side, it plans to raise IDR 2 trillion via rights issue.

The 8 SOEs are:
  1. PT Jasa Marga (Persero) Tbk (JSMR), where the project will utilize some of the land it owns;
  2. PT Telekomunikasi Indonesia Tbk (TLKM), which will provide the communication and ticketing system;
  3. PT LEN Industries to source the IT part of the projects;
  4. PT Industri Kereta Api or Inka, which is a local train manufacturer;
  5. PT Angkasa Pura II to provide land in airport area;
  6. PT Pelindo III to provide land in seaport area;
  7. PT Bank Mandiri to provide loan for 3 monorail projects;
  8. PT Adhi Karya as consortium leader
3 monorail projects are planned by the consortium are:
  • Jakarta Link Transportation (JLT) – Bekasi Timur – Cawang (18.1km), Cibubur – Cawang (13.7km) and Cawang – Kuningan (7.2km). Total investment of Rp7 trillion.
  • Automatic People Mover (APM) Soekarno Hatta monorail (Airport) – Jakarta to Soekarno Hatta airport with total investment of Rp 2.5 trillion. Operation is expected to start by 2015.
  • Automatic Container Transporter (ACT) Tanjung Perak, Surabaya, monorail (Seaport) – bulk only monorail in Tanjung Perak seaport.
All domestic consortiums. As a consortium leader, ADHI will have a control over the construction works of the project, which will bring positive catalyst to ADHI’s order book in the next 3-4 years as the project is multi-year project. Interesting aspect of this project is that all of the works will be handled by SOEs and financed by a consortium of state-owned banks.

Comparable to MRT project. In terms of project size, both MRT and Monorail project are about the same at Rp 12 trillion, yet in the monorail project, there is only one construction company involved which means more order book can be secured by ADHI in the project.

Indonesia Market Summaries, 7 May 2013

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