LRT Project Photo by TheInsiderStories/RK

JAKARTA (TheInsiderStories) – State-owned railway company PT Kereta Api Indonesia (KAI) and state-owned construction company PT Adhi Karya Tbk (IDX:ADHI) on Tuesday (19/12) signed contract amendment to develop the Rp29.9 trillion Light Rail Way (LRT) connecting Jakarta and its satellite cities – Bogor, Depok and Bekasi.

The contract amendment was signed by Director General for Railways at the Transportation Ministry Zulkifri and President Director of Adhi Karya Budi Harto.

The project is targeted to be completed in May 2019. The amendment stipulates that the government appoint KAI and Adhi Karya as investors and contractors of the Jakarta-Bogor-Depok-Bekasi LRT project.

Based on Presidential Decree No. 49, 2017, the government appointed KAI to develop the LRT in the Greater Jakarta area. The scope of the work encompasses development, operation, maintenance and involvement in the railway business.

Adhi Karya is responsible for the development of facilities, including stations and other supporting facilities.

The Greater Jakarta LRT will connect Cawang in East Jakarta to Dukuh Atas in Central Jakarta with a length of 11.05 km, Cawang and Cibubur 18.49 km and Cawang-East Bekasi 14.89 km.

Adhi Karya said as of Dec. 8, 2017, the Greater Jakarta LRT project has reached an overall 26.2 per cent of its completion. The Cawang-Cibubur section has reached 46.85 per cent, Cawang-Dukuh Atas 12.36 per cent and Cawang-East Bekasi 26.95 per cent.

The project is funded by equity of both KAI and Adhi Karya, and the remainder from bank loans.

In May Adhi Karya issued bonds worth Rp3.5 trillion to partly fund light rapid transport (LRT) in the Greater Jakarta area (Jabotabek).

The bonds carry a tenor of five years, payable every three months, starting from Sept 22, 2017, with the last payment on June 22, 2022. As much as Rp800 billion of the bond proceeds were allocated to two subsidiaries of Adhi Karya, namely, PT Adhi Persada Beton (APB) and PT Adhi Persada Gedung (APG), to fund development of the LRT projects.

As much as Rp500 billion of the bond proceeds will be used to refinance its matured bonds and the remainder to strengthen the working capital of Adhi Karya.

Written by Roffie Kurniawan, email: roffien@theinsiderstories.com