The Insider Stories Market Briefs

*Indonesia won a US$2 billion dispute after the International Centre for Settlement of Investment Disputes (ICSID) tribunal ruled in the country’s favor against claims filed by British miner Churchill Mining Plc. Churchill Mining has been ordered to pay a total of $8.65 to the Indonesian government. Churchill took the legal dispute to ICSID in May 2012. In 2010, Churchill filed the case to the Samarinda Administrative Court after the company’s mining permit was deemed insufficient and revoked by the regional government. The Court said that the permit revocation was in compliance with necessary procedures. In 2011, Churchill appealed to the Jakarta State Administrative Court, which resulted in the same ruling. Churchill owns 75 percent shares of four mining concessions. The dispute object is a 35,000-hectares concession area in Busang, Muara Wahau, Telen, and Muara Ancalong districts in East Kutai, East Kalimantan. The lands were previously owned by Nusantara Group, whose term ended in 2006-2007. The land then became PT Ridlatama’s, from which later acquired it from.

*PT Bumi Resources Tbk (BUMI) to be floated 29.1 billion shares, or 80% of the issued and fully paid as part of the company’s debt to equity conversion before June 30, 2016, said Finance Director Andrew Christopher Bechkam. The price of new shares at Rp 926 per share according to the agreement with the creditors. With the issuance of new shares, the number of BUMI’s shares would soar to 65.7 billion. Currently, the market capitalization of BUMI around Rp 11 trillion. BUMI, He said, will continue to offer the existing shareholders to take away their rights. Currently China Investment Corporation tucked the 16.9% stake and the public holding a 83.1% stake in BUMI. The company will submit corporate action plan to the Financial Services Authority and the Indonesia Stock Exchange in January 2017. Thus, the General Meeting Extraordinary Shareholders can be done in April or May 2017.

*Ahead of the Organization of the Petroleum Exporting Countries (OPEC) meeting on Dec. 10, oil price conditions had begun to improve. According to Bloomberg, WTI oil price in January 2017 delivery contract on the New York Mercantile Exchange rose 1.04% to US $ 49.76 per barrel compared to the previous day. Chinese imports already managed to rise up from its lowest point during the last 9 months. During November crude oil imports increased from 6.87 million barrels per day to 7.97 million barrels per day.

*PT Bank Rakyat Indonesia Tbk (BBRI) set capital expenditure of Rp 2.5 trillion in 2017 to enhance the features of digital information technology and banking, said the CEO Asmawi Syam from this year’s Rp 2 trillion. According him, next year the bank will really optimize IT networks both satellite and physical networks owned to increase digital business banking. This is to answer the market need for digital business lately. Until the third quarter of 2016, fee-based BRI of e-banking reached 25% of total fee-based. While fee based on the payment system recorded 3% of the total fee based. BRI’s total fee-based third-quarter 2016 to Rp 6.6 trillion, up 26% yoy from the previous year.

*PT Bukit Asam Tbk (PTBA) bidding for another power plant project with a total capacity of 600 Mega Watt with investment value more than US$720 million, said Corporate Secretary Adib Ubaidullah. PTBA has been managing the project with a capacity of about 220 MW of electricity. Next year, PTBA will start the mine mouth power plant projectSumsel 8 with a capacity of 2×620 MW worth $1.6 billion. The company will also begin to build Peranap power plant with a capacity of 600 MW. So that in total, PTBA hopes to manage projects stun up to 5,000 MW in 2023 to come. The entire project is estimated to require electricity equity of $2.5 billion. Next year, PTBA optimistic achieve production of 28 million tons of coal, up from this year’s projected that approximately 25.75 million tons.

*PT Telekomunikasi Indonesia Tbk (TLKM) shared interim dividend for fiscal year 2016 of Rp 19.3 per share. Cum dividend in the regular market and negotiation market at Dec, 14. In the third quarter of 2016, TLKM net profit of Rp 14.73 trillion, up 27.6% from the third quarter of 2015 were recorded at Rp 11.54 trillion. Meanwhile, revenue rose 13.7% to Rp 86.18 trillion from previously Rp 75.75 trillion. TLKM not the only issuer to pay dividends at the end of 2016. Several issuers like EMTK and UNVR also distribute dividend to the amount of dividends of Rp 20 per share and Rp 375 per share.

*Indonesia is projected to take 52% share of Southeast Asia e-commerce market worth US$87.8 billion by 2025. A joint research conducted by Google and Temasek revealed that in 2015 Indonesia ranked first in the world in e-commerce market growth. The growth is projected to reach 19% by 2020. The same is predicted to also happen to internet economy, in which e-commerce sits atop, followed by online media and online travels.