PT Uni-Charm Indonesia planned to hold an initial public offering in this year - Photo by the Company

JAKARTA (TheInsiderStories)PT Uni-Charm Indonesia, the local arm of Japan-based diaper and feminine-care firm Unicharm Corp., planned to hold an initial public offering (IPO) in this year. The potential funding that can be obtained around Rp1 trillion (US$70.92 million), said the management last week.

Director of PT Sinarmas Sekuritas Kerry Rusli said the local securities house to underwrite the IPO. Unicharm management previously stated that it intended to release its subsidiary, Uni-Charm Indonesia, to be listing on the stock exchange, as a strategy to expand in Asia.

Unicharm also ensured that after the IPO, the performance of Uni-Charm Indonesia would remain consolidated with the manufacturer.

Uni-Charm Indonesia’ Head Office Kosuke Saito believed that baby diaper needs are growing and for this year and will contribute the most to the company’ revenues in the future. Last year, the contribution of income from the sale of baby diapers was 80 percent, followed by the contribution of sanitary napkins by 13 percent, and the remaining income from adult diapers, he said.

Recently, the company has two factories located in Karawang, West Java and in Surabaya. Unfortunately, he did not explain in detail the capacity of the two factories.

In addition to two factories located in Indonesia, the company also brings in its holding’ products for sale in Indonesian market. Saito said the three products from the Charm were attracting a market share of 60 percent and aimed to maintained the market share in this year.

Uni-Charm Indonesia just released a new sanitary napkin product called Cooling Fresh. This product had previously been released by the Uni-Charm Group in Thailand and Vietnam four years ago. Saito optimistic that the newly released products in Indonesia will also be welcomed by the customers. Overall, Uni-Charm Indonesia accounts for 20 percent of the total Uni-Charm Group revenue.

“Indonesia is the third largest country contributing revenue, first there is Japan, then China, and Indonesia,” Saito said.

Analysts rated that there is still a good moment for IPO in Indonesia. During the second quarter, eight companies have been listed in Indonesia Stock Exchange (IDX) and in the second quarter (2Q) with total of 15 IPOs. So far The stocks watcher said that there are still more than 20 companies in their pipeline.

Ekuator Swarna Sekuritas Head of Research David Sutyanto mentioned that IPO in the local market is still profitable. But he reminded that it has a special characterization in the price-making for the initial 10 days and prone to auto-reject. Even so, the sector pioneer like Bali United usually hikes well due to market curiosity.

Indosurya Sekuritas Head of Research William Surya Wijaya explained that the in 1H IPO is quite good due to investors’ optimism for investing. But there will be more challenge in the second semester, because people will start to realize the real condition of the market.

““People are quite optimistic with the IPO companies. I think it (IPO) is more to speculation. But for investing in a long-term, we must check the company (performance),” said Wijaya.

Furthermore, he rated that finance and consumer goods sectors are still the market-driven. Besides those sectors, Wijaya also recommended telecommunication sector.

Wijaya is optimistic for Jakarta Composite Index to be at 7,000 or reach its all-time high, this year seeing the foreign inflow. Meanwhile, Sutyanto predicted the 2019’ index will close at around 6,500.


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