Daily Business Briefing – Oct. 18

JAKARTA (TheInsiderStories) – Good morning; here we provide several pieces of important news that might help your business decisions today:

Telkomsel Wins Spectrum Auction with Rp1 trillion offer

PT Telekomunikas Selular (Telkomsel), a unit of PT Telkom Indonesia (IDX: TLKM) is set to win the government’s auction for the 2.3GHz spectrum, the country’s Ministry of Communication and Informatics said on a statement on Tuesday (17/10). The wining bid was worth Rp1.01 trillion, beating four rivals, including PT XL Axiata Tbk (IDX: EXCL) and PT Indosat Ooreedoo Tbk (IDX: ISAT). The Ministry will allow other bidders to submit their revised bids before officially announcing Telkomsel as the winner of the auction.

BRI Plans Stock Split in November

Indonesia’s second-largest lender by assets PT Bank Rakyat Indonesia Tbk (IDX: BBRI) is planning to conduct a stock split with a ratio of 1 : 5, corporate secretary Hari Siaga Amijarso said. He said the stock split is intended to boost liquidity in trading of the lender’s shares.

Government Completes Five National Strategic Projects

The Indonesian government has completed five of its national strategic projects as of the first half of this year. 74 current efforts consist of 23 train projects, 10 port projects, 8 airport projects, 30 special economic zones projects, 3 housing projects, 3 State Border Post  construction projects, 10 clean water and sanitation projects, 54 dam projects and 7 irrigation projects. In total there are 245 projects under construction, along with 2 programs, with an investment value of Rp 4,197 trillion; some are dealing with the procurement process while others are still in preparation.

Minna Padi Plans Rights Issue to Acquire Muamalat Bank

Listed brokerage PT Minna Padi Investama Sekuritas Tbk (IDX: PADI) is seeking to raise capital through a preemptive rights issue, in its effort to acquire a majority stake in Indonesia’s oldest shariah-compliant lender, PT Bank Muamalat Tbk. The plan is part of Minna Padi’s effort to diversify the company’s business in the financial and banking sectors. In a prospectus, the brokerage said it plans to issue 5 billion new shares, or 30.7 percent of its enlarged capital. It has yet to announce the price per share. Minna Padi said it will need Rp4.5 trillion (US$333.17 million) to acquire a 51 percent stake in Bank Muamalat, and additional funds for working capital.

Government to Raise Floor Airfare Prices

The Ministry of Transportation has announced that it plans to raise the floor price of coach class airfare for busy routes, to allow local airlines to cope with rising costs. The new floor prices will be as low as 40 per cent of the ceiling price for 15 of its busiest routes, up from a current 30 per cent, Transportation Minister Budi Karya Sumadi said on Monday (16/10). The regulator will shortly enact the policy, he added.

Japan’s Mitsubishi Injects US$5.35bn for Electrified Vehicles, Production in Indonesia and China

Japanese automaker Mitsubishi Motors reportedly plans to inject more than 600 billion yen (US$5.35 billion) in capital spending and research and development over the next three years through fiscal 2019 in a bid to turn around its business. The new plan calls for spending 5 percent of annual sales on equipment and the same proportion on R&D. Funds will be used by the company for the development of electrified vehicles and for production in China and Indonesia. Mitsubishi will release the specifics of the new medium-term plan on Wednesday.