Electronic City Indonesia (ECI), a leading electronics retailer in Indonesia, plans to conduct an initial public offering (IPO) on the Indonesia Stock Exchange (IDX) in June 2013. According to the company's website, Electronic City is Indonesia's first modern electronic convenience store, specialized in selling electronic products for Indonesia's middle class and elite. Through the IPO, the company hopes to raise about USD $150 million which will be used for capital expenditure.
The company appointed Danareksa Securities and Credit Suisse as underwriters for the IPO. According to media sources, Electronic City Indonesia will offer 25 percent of its stock equity to the public. Acquired funds will be used to add new stores in Indonesia to the current number of 17 stores and 12 outlets.
Household consumption in Indonesia accounts for about 55 percent of Indonesia's economic growth. Moreover, the Boston Consulting Group projects that the number of middle class and affluent consumers in Indonesia will double between now and 2020. Currently, Indonesia has about 70 million people that can be categorized as middle class, while Indonesia's total population numbers 240 million people. For companies that are focused on Indonesia's middle class consumptive behavior, it thus creates a conducive context.