Indonesia Market Summaries 19 July 2013

• One of Japan's largest general trading company, Marubeni Corp., took coal company PT Indika Energy Tbk (INDY, Rp3.700), Korea Midlane Power Corp., and Korea Samtan project to build a 1,000-megawatt power plant in Tanjung Jati, Cirebon.
  
  Projects with investment worth U.S. $ 1.5 billion to U.S. $ 2 billion done by forming a consortium of four companies named Cirebon Electric Power. (Investor Daily).
• Bumi Plc agreed to release their stake in PT Bumi Resources Tbk to Bakrie Group for U.S. $ 501 million. This value was claimed to be more expensive than its book value. (Bisnis Indonesia)
• A German multinational petrochemical company, Ferrostaal Industrial Projects GmbH, invites PT Chandra Astri Petrochemical Tbk (TPIA, Rp2.675), a company owned by Indonesian tycoon Prajogo Pangestu, to build a petrochemical plant. The factory located in Bintuni Bay, West Papua, was worth U.S. $ 1.8 billion or equivalent to Rp 15,25 trillion.
  
  In the other article, petrochemical prices in late June reported by Inaplas up 2.6% to U.S. $ 1,312 per metric ton which is the first increase since the beginning of the year due to the U.S. and European economies began to improve. (Kontan)
• PT Wijaya Karya Tbk (WIKA, Rp2.250, NEUTRAL TP: Rp2.200) plans to increase the share of ownership in the joint venture in Myanmar up to 40% within the next 3 years. Currently, the company only has 10% share of the capital investment of U.S. $ 20 million.
  
  The composition of these shares will be split between Wika and PT Wika Beton, 50% respectively. Thus, the company will increase capital investment 4 times the initial capital to get stake' percentage up to 40%. The funds will be used to increase the stock comes from internal cash. (Bisnis Indonesia)
• PT Holcim Indonesia Tbk (SMCB, Rp2.675, SELL, Rp 3,000) to prepare initial production of Tuban I plant with a capacity of 1.7 metric ton in August. SMCB hopes the plant can produce 850,000 tonnes at the start of production, half of the total capacity. Early next year, the plant will produce a maximum capacity of 10 metric tons per year.
  
  SMCB will start preparing to develop Tuban II plant with a capacity of 1.7 metric tons which will be completed by 2015 and will cost U.S. $ 800 million. (Kontan)

for Indonesia Market Summaries 19 July 2013

Wijaya Karya Earn 6 trillion New Contract

PT Wijaya Karya Tbk (WIKA) has received a new contract worth up to Rp 6 trillion in May 2013, or 28.90% of the target of a new contract this year Rp20, 76 trillion.

Corporate Secretary of Wijaya Karya, Natal Argawan Pardede said that the biggest contribution to a new contract in May 2013 contributed from the construction of buildings such as terminal, hospitals and other amounted to Rp 2,5 trillion.

"The contract is not included the company's subsidiary such as PT Wika Beton and PT Wika Realty," he said during a press conference in Jakarta, Wednesday (12/06/2013).

One of the new contract is Engineering, Procurement, Construction and commissioning (EPCC) of new condesate and diesel tanks of British Petroleum Ltd (BP) with a contract value of USD 39.82 million.

The Company also obtained the Cilacap Coal Plant Project, PDAM Sunggal project, Miangas airport construction project, construction on the north side of New Samarinda Airport project, and Wain Dam advanced project development.

In addition, the company also have road construction of Ram 3 and KM 13 Kariangau, Simpang Air Hitam flyover construction projects, emergency repair process of Merapi eruption, Upper Bengawan Solo project and Brebes murky river management project.

for Indonesia Market Summaries 13 June 2013

Wijaya Karya's Net Profit Raised 65% in First Quarter of 2013

Government-owned construction company, PT Wijaya Karya Tbk (WIKA) posted a net profit growth of 65% in the first quarter of 2013 to Rp 157 billion from the same period last year.

President Director of Wijaya Karya, Bintang Perbowo said that the achievement was contributing 28% of total net income target this year amounted to Rp 555 billion.  According to him, the acquisition of new contracts by March 2013 recorded Rp 4,68 trillion or has reached 22.54% of the target of the new contract in 2013 worth Rp 20,76 trillion.

The company expects the acquisition contract combined with the carry-over of last year amounted to Rp 38,87 trillion, up 21.15% of 2012 realization.

Several projects that have been acquired by the company among others are The Expansion and Development of Terminal 3 Ulimate Soekarno-Hatta Airport Rp 1,79 trillion, Trass & Limestone Handling System project Rp 46,6 billion, and a number of other projects.

for Indonesia Market Summaries 13 June 2013

WIKA first quarter 2013 result 63% net earning grew

WIKA reported 1Q13 result where net earnings grew by 68% yoy, from Rp104.5bn to Rp175.5bn. The achievement represents 22.3% of consensus estimates.

Revenue grew by 50.3% yoy, from Rp1,748.6bn to Rp2,627.6bn. Compare to last quarter, revenue was down by 23.7% qoq. This quite normal as SOE contractors normally books higher portion of revenue in the last quarter of the year.

Interesting development was on margins side, where we can see quite significant improvement. The company indicated that it is becoming more selective on the project (higher margin projects) they take to improve margins.

The EGM also approved Rp137.4bn dividend (30% payout ratio), which will translate to Rp22.3/share. Dividend payment grew by 27% yoy.

Friday 12 April 2013 in brief

BSDE recorded a yoy jump on 1Q13 marketing sales by 214%

Bumi Serpong Damai announced their Q1 marketing sales of Rp2.6tn which jumped by 214% yoy. The marketing sales itself is already 37% of BSDE’s full year target of Rp7tn. Land plot sales (77% of 1Q13 marketing sales) is the main contributor, where it grew by 613% yoy. Meanwhile, residential contributed 20% of total marketing sales while commercial contributed 11%. The company’s JV with Hongkong Land and AEON Mall was a strong push to BSDE’s early year achievement, according to the company, as they managed to book gain of Rp1.7tn from selling 66ha to the two partners. Moreover, BSDE and Hongkong Land’s JV company will acquire 10ha more land from BSDE, according to the company. (Kontan)

Sentul City gained Rp250bn working capital loan

Last month, BKSL, through PT Bukit Jonggol Asri, gained a Rp250bn loan from Bank Panin to be used to develop a township. The tenor is 3 to 5 years with a single digit interest rate. BKSL added that Rp20bn will be used for working capital, Rp100bn for long term infrastructure and facilities, and Rp130bn for housing construction working capital. (Bisnis Indonesia)

Semen Indonesia showed the strongest growth in Q1

SMGR showed the strongest growth in sales compared to its peers in 1Q13 where the company’s sales grew by 8.6% yoy. The strong growth was due to capacity increase from their new Tuban IV and Tonasa V plants of 750k tons and 600k tons respectively. SMGR expects revenue to grow 21% yoy in 1Q13 which is resulted from sales volume growth. The company claimed that they saw less than 1% growth in ASP in Q1. (The Jakarta Post)

Jaya Agra Wattie to boost CPO and rubber productions

JAWA is targeting CPO production of 56,217 ton which is 21.4% higher compared to the same period last year. Production growth in CPO is expected due to higher palm age that should boost productivity. Fresh fruit bunches (TBS) purchases from third parties is also expected to increase where 39% of their total production will come from third parties. JAWA is also allocating Rp570bn for CAPEX to develop 4,000ha of CPO plantation and 5,500ha of rubber plantation. The company is planning to add landbank of 50,000ha in Kalimantan and Sumatra this year. (Kontan)

Wijaya Karya (WIKA) to accelerate IPO of Wika Beton.

A newspaper reported that Wijaya karya (WIKA) plans to accelerate the IPO of its precast concrete subsidiary, WIKA Beton, to this year. Current WIKA Beton capacity reaches 2mn ton per year at 9 precast concrete plants. It’s also planning to acquire a precast concrete company in Batam. Wika Beton assets is around Rp2.3tn with Rp180bn net profit. On the IPO, proceed is expected to be around Rp1tn for 20% shares. WIKA owns 78.4% ownership of Wika Beton. (Investor Daily)