Contrary to its initial expectation, the management of PP Properti expects that investor appetite for the company’s shares has been reduced due to the country’s economic slowdown (economic growth of Indonesia slowed to a five-year low of 4.71 percent y/y in the first quarter of 2015). Both Indonesia’s construction and property sectors have slowed accordingly.

The company plans to use 75 percent of IPO proceeds for business expansion, which includes the expansion of its 55-hectare land bank in Java and Kalimantan. Approximately 15 percent of proceeds is to be used for working capital to develop existing residential and commercial projects in Bekasi, Tangerang, Surabaya, Bogor and Semarang. The remaining 10 percent will be used to pay debts to the company’s parent company Pembangunan Perumahan (PP).

In 2015, PP Properti reported an 85 percent (y/y) increase in revenue to IDR 555 billion, and IDR 106 billion in net profit.

Although having lowered its target, General Director Galih Prahananto said that PP Properti organized successful road shows in Hong Kong, Singapore, Malaysia and Jakarta.

Listing on the IDX is scheduled for 19 May 2015. Danareksa Securities, Mandiri Sekuritas, Bahana Securities, CIMB Securities and CSLA Indonesia have been appointed as underwriters for the IPO.