(Image Credit : PP Presisi)

JAKARTA (TheInsiderStories) – PT PP Presisi Tbk (IDX:PPRE), a subsidiary of state-owned construction company PT PP Tbk (IDX:PTPP), started its trading debut on the Indonesian Stock Exchange on Friday (24/11) after raising Rp 1 trillion from the initial public offering.

The company sells 2.35 billion units of shares through the initial public offering (IPO), representing 23 per cent of the company’s enlarged capital, at price of Rp 430 per share.

The company’s shares opened 10 points minutes higher after the opening to Rp 440 per share, but fell again to below its IPO price, in line with the overall market decline. The company’s shares were trading within range of a high of Rp 400 and a low of Rp 392 per share on its trading debut.

President Director of PP Presisi Iswanto Amperawan said that 70 per cent of funds raised through IPO will be allocated to purchase equipment and acquire land for workshops as well as stone quarry land. The remaining funds will be allocated to fund infrastructure projects.

The company aims to secure project contracts value of up to Rp 8 trillion next year. This year, the company expects to bag contracts of up to Rp 5.8 trillion. In the ten months to October, the company has sealed contracts amounted to Rp 4.2 trillion.

The company plans to set aside Rp 1.4 trillion for capital expenditure next year, which will come from IPO proceeds, bank loans as well as financing from leasing companies.

“Our net gearing ratio improves to 0.2 from 0.7 after IPO, means that we have more room for leveraging,” he added.

Meanwhile, two other subsidiaries of PP, namely PP Energi and PP Urban, are scheduled to list their shares on the Indonesia Stock Exchange in the first half of 2018.

Tumiyana, General Director at PP, said the two companies were previously scheduled to go public this year. However, the company later postponed the two companies’ IPO, to pave way for other state-owned companies to list their shares on the stock exchange. The company considers next year will be perfect time for  the two units to launch IPOs.

Shares of parent company PP have tumbled 30.45 per cent to Rp 2,640 a piece so far in 2017. This construction services company has six main business lines: (1) civil works, (2) ready mix, (3) foundation work, (4) erector, (5) form-work, and (6) heavy equipment rental.

Written by : Yosi Winosa, email :yosi.winosa@theinsiderstories.com

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