Photo by IDX

JAKARTA (TheInsiderStories) – The Indonesian Stock Exchange (IDX) has announced that nine companies are lining up to list their shares in the fourth quarter (Q4) of 2017. 22 new issuers have already floated on the IDX this year, from a target of at least 35 new issuers in 2017.

IDX Director of Corporate Valuation Samsul Hidayat explained that three of them are subsidiaries of SOEs which have registered on the bourse: PT PP Precision, PT Wika Gedung and PT Garuda Maintenance Facility AeroAsia.

In addition, several start-up companies are listing on the stock exchange; one is PT M Cash Integrasi, a subsidiary of PT Kresna Graha Investama Tbk (IDX: KREN). M Cash plans to hold an IPO in October, using its April 2017 financial statements as the basis of valuation.

Other companies lining up to go IPO include PT Malacca Trust Wuwungan Insurance and PT Kapuas Prima Coal, shipping operator PT Pelita Samudera Shipping, PT Trisula Textile Industries and PT Kioson Commercial.

Hamdi Hassyarbaini, Director of Surveillance and Compliance at IDX told TheInsiderStories other companies planning to go for IPOs are PT Avia Avian, a paint company, seeking to raise $250 million and PT Medikaloka Hermina, owners of the Hermina hospital chain, expecting to raise $169 million.

SOE units like PT PP Urban and PT PP Energy (subsidiaries of state-controlled builder PT PP Tbk), property developer PT Wijaya Karya Building and PT Wika Realty are also stampeding to become public companies by the end of this year. Another is insurance company PT Tugu Pratama Indonesia (a subsidiary of PT Pertamina), PT Jasa Armada Indonesia (a subsidiary of port operator PT Pelabuhan Indonesia II), and PT Adhi Persada Gedung, a subsidiary of construction firm PT Adhi Karya Tbk (IDX: ADHI).

After meeting with capital market players at IDX on July 4, President Joko Widodo expects the inflow to Indonesian capital market to double this year, compared to last year’s Rp126 trillion (US$9.47 billion), tracking the positive momentum of Indonesia’s elevation to ‘investment grade’ by Fitch Ratings, Moody’s and then Standard & Poor’s.

He noted that from January until May the capital inflows into Indonesia nearly equaled last year’s Rp124 trillion. To improve the market capitalization of IDX, the President urged SOEs and foreign firms with their operations in Indonesia to also list their shares and other instruments on IDX to finance their businesses.

According to Mandiri Institute, Indonesia has the potential to become the seventh-largest economy by 2030 and thus needs to reform its financial markets. Otherwise, they feared Indonesia will remain out of the top 10.

The researchers also observed how equity shares on the capital market should reach 78 percent of gross domestic product (GDP); the number of listed companies should reach 1,700, and the number of retail investors will hopefully mark 6 million in 2030.

Mandiri Institute also concluded that selected initiatives that government could implement include an enlarged investor base, relaxation of restrictions on banks’ equity financing, development of equity derivatives, including index options and futures, and single stock options and futures, which would also improve corporate governance standards.

US$1: Rp13,300

Writing by Linda Silaen, Email: linda.silaen@theinsiderstories.com

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