Hospital operator Royal Prima made its trading debut on the Indonesia Stock Exchange on Tuesday (15/05) after having successfully completed its initial public offering (IPO). Royal Prima is the 13th company so far this year to became a publicly listed company in Southeast Asia's largest economy. There are now 578 companies listed on the Indonesia Stock Exchange. Danatama Makmur Sekuritas acted as lead underwriter.
In the corporate action Royal Prima offered 1.2 billion shares to investors for a price of IDR 500 a piece, hence raising IDR 600 billion (approx. USD $43 million) in new funds. The company also issued 600 million stock warrants. For every two shares an investor obtains one warrant (a strategy to make the IPO more attractive amid the current volatile conditions). After six months investors have the opportunity to purchase the underlying stock. This should add another IDR 375 billion (approx. USD $27 million) to the total.
About 40 percent of the IPO proceeds will be used to acquire new hospitals this year. Meanwhile, 20 percent will be used for the renovation and capacity expansion of older facilities, while the remaining 20 percent is set to be used for revamping the company's information technology system.
Mok Siu Pen, Director of Royal Prima, said the company plans to acquire four hospitals - located in Medan, Tebing Tinggi, Pekanbaru and Tangerang - before the end of 2018. Two of the hospitals are not general hospitals but specialized clinics (eyes and teeth).
Currently, Royal Prima owns two hospitals; one in Medan (with a capacity of 754 beds) and one in Jambi (250 beds). By 2019, the management wants to have upgraded the number of beds in these hospitals to 1,100 beds and 350 beds, respectively. The occupancy rates in both hospitals is around 70-80 percent. Pen added that the company wants to establish a high quality heart center as well as a cancer center to attract a new group of patients, especially from North Sumatra, who currently seek treatment in Malaysia or Singapore.
In full-year 2017 Royal Prima's net profit reached around IDR 20 billion (approx. USD $1.4 million). Pen said the company is optimistic that net profit will raise more than twofold to IDR 45 billion in 2018 as the revenue target is set to double.
The IPO of Royal Prima was oversubscribed 42 times. However, besides high investor appetite, it was also caused by the downsizing of the company's IPO. Initially, Royal Prima targeted to sell 2 billion shares in the IPO.
After its first trading day shares of Royal Prima soared 50 percent to reach IDR 750 a piece, thus triggering the stock exchange's autoreject system.
According to Samsul Hidayat, Director of Corporate Listing at the Indonesia Stock Exchange, up to 24 other companies are expected to list on the local bourse in the first half of 2018. This would mean Indonesia is set to break a record in 2018 in terms of IPOs.
So far in 2018 thirteen companies have been added to the Indonesia Stock Exchange: telecommunication construction services company LCK Global Kedaton, coal miner Borneo Olah Sarana Sukses, helicopter transportation services company Jaya Trishindo, solar panel manufacturer Sky Energy Indonesia, trade, transportation and logistics services provider Indah Prakasa Sentosa, telecommunication support services company Gihon Telekomunikasi Indonesia, chemical manufacturing company Tridomain Performance Materials, property developer Dafam Property Indonesia, financial institutions Bank Tabungan Pensiunan Nasional Syariah and Bank BRISyariah, investment company Charnic Capital, sanitary ware company Surya Pertiwi, and hospital operator Royal Prima.
Last Update: 15 Aug 2018
IPOs on the Indonesia Stock Exchange up to 15 May 2018
|Company||P: 15 Aug 2018||P: 14 Aug 2018||Gain/Loss||P/E ttm||Yield %||Gain/Loss YTD|
|LCK Global KedatonLCKM||338||330||2.42%||N/A||0.00%||8.33%|
|Borneo Olah Sarana SuksesBOSS||2,260||2,250||0.44%||N/A||0.00%||276.67%|
|Sky Energy IndonesiaJSKY||925||935||-1.07%||N/A||0.00%||54.17%|
|Indah Prakasa Sentosa Tbk.INPS||2,060||2,060||0.00%||N/A||0.00%||397.58%|
|Gihon Telekomunikasi Indonesia Tbk.GHON||1,000||1,000||0.00%||N/A||0.00%||-43.02%|
|Tridomain Performance Materials Tbk.TDPM||334||326||2.45%||N/A||0.00%||-2.34%|
|Dafam Property Indonesia Tbk.DFAM||1,095||1,100||-0.45%||N/A||0.00%||461.54%|
|Charnic Capital Tbk.NICK||135||125||8.00%||N/A||0.00%||-60.29%|
|Bank Tabungan Pensiunan Nasional Syariah Tbk.BTPS||1,585||1,605||-1.25%||N/A||0.00%||8.56%|
|Bank BRIsyariah Tbk.BRIS||620||610||1.64%||N/A||0.00%||13.76%|
|Surya Pertiwi Tbk.SPTO||1,010||1,025||-1.46%||N/A||0.00%||-15.13%|
|Royal Prima Tbk.PRIM||1,500||1,510||-0.66%||N/A||0.00%||100.00%|
Green colour indicates upward movement
Red colour indicates downward movement
P = price; E = earnings; D = dividend; Yield = D/P
"N/A" indicates P/E < 0 (negative earnings)
"-" indicates E,D,P or YTD is not available