Soechi Lines First of 6 IPOs on Indonesia Stock Exchange in December

Go Darmadi, President Director of Soechi Lines, said that 55 percent of the proceeds will be used to buy new ships, 30 percent to pay off debts of its subsidiaries, and the remaining 15 percent for working capital of its subsidiaries.

Soechi Lines, established in 1977, is an Indonesia-based company engaged in marine transportation as well as hotel management in Medan (North Sumatra), and owns a shipyard in Karimun Island (located close to Singapore and Batam). Soechi Lines currently owns a fleet of 33 ships (including oil tankers, chemical tankers, and gas carriers).

The successful trading debut of Soechi Lines signals that there is plenty of interest in Indonesian stocks after political uncertainties (brought about by the fragmented outcomes of Indonesia’s legislative and presidential elections in 2014) have eased and the new Joko Widodo-led government has showed its commitment to implement structural reforms in a bid to boost economic and social development in Southeast Asia’s largest economy. One example of this commitment was the recent subsidized fuel price hike. On 18 November 2014 subsidized fuel prices (low-octane gasoline and diesel) were raised (a move which implies political and social risks in Indonesia) by over 30 percent in order to relieve pressures on the government budget deficit and the current account deficit, as well as to reallocate government spending from fuel consumption to structural sectors such as infrastructure, agriculture, education and healthcare. Widodo targets to push economic growth back to +7 percent year-on-year by 2019 through structural reforms. If realized, this would fuel appetite for Indonesian stocks as well as for more IPOs to be conducted on the IDX. In the third quarter of 2014, Indonesia's GDP growth fell to a five-year low of 5.01 percent (y/y).

However, higher subsidized fuel prices also resulted in Bank Indonesia’s decision to raise its key interest rate (BI rate) by 25 basis points to 7.75 percent in November 2014, a relatively high interest rate, implying that, from a sectorial point of view, stocks of banks and other financial institutions will have difficulty to gain. Moreover, amid continued weak external demand, companies focused on commodities also still have a bleak outlook. Lastly, Indonesia may be hit by severe capital outflows after the US Federal Reserve announces to raise its key interest rate. US interest rates are expected to raise in the second or third quarter of 2015.

President Widodo has repeatedly emphasized that he intends to focus on development of the maritime sector. This makes stocks of Soechi Lines attractive as the company can benefit from the country's new development targets in the maritime sector. Furthermore, with a price to earnings ratio of between 7.9 and 10.5 times, Soechi Lines' shares are attractive (the average P/E ratio in Indonesia's shipping sector is 9 times). In the first six months of 2014, Soechi Lines posted a 18.3 percent growth (y/y) in revenue to USD $54.7 million, while net profit increased 52.9 percent (y/y) to USD $15.6 million over the same period.

Planned IPOs on the Indonesia Stock Exchange in December 2014:

Company	Shares to be           Issued	Value	Listing Date
Soechi Lines	15%	IDR 582.5 billion	3 December 2014
Intan Baruprana Finance	40%	IDR 520-640 billion	4 December 2014
Archi Indonesia	40.4%	IDR 3.0-3.9 trillion	15 December 2014
Impack Pratama Industri	40%	not available	17 December 2014
Bank Agris	20%	IDR 94.5-103.5 billion	22 December 2014
Golden Plantation	21.8%	IDR 200-240 billion	23 December 2014

^{Source: Investor Daily}

If realized, these six IPOs would bring the total number of IPOs on the IDX in 2014 to 25, and the total number of companies listed on the IDX to 508 (a low figure compared to its regional peers). Ito Warsito, Director of the IDX, said that he expects 32 companies to list on the IDX in 2015.

Last Update: 29 Mar 2021

IPOs on the Indonesia Stock Exchange up to 3 December 2014

Company	P: 29 Mar 2021	P: 28 Mar 2021	Gain/Loss	P/E ttm	Yield %	Gain/Loss YTD
Bank Panin SyariahPNBS	83	82	1.22%	N/A	0.00%	-4.60%
Asuransi Mitra Maparya Tbk.ASMI	925	930	-0.54%	N/A	0.00%	-6.57%
Bank Ina Perdana Tbk.BINA	1,560	1,550	0.65%	N/A	0.00%	64.21%
Capitol Nusantara Indonesia Tbk.CANI	186	186	0.00%	N/A	0.00%	22.37%
Tunas Alfin Tbk.TALF	310	258	20.16%	N/A	0.00%	13.97%
Bali Towerindo Sentra Tbk.BALI	700	690	1.45%	N/A	0.00%	-6.04%
Wijaya Karya BetonWTON	334	344	-2.91%	N/A	0.00%	-20.85%
Graha Layar PrimaBLTZ	4,600	4,650	-1.08%	N/A	0.00%	53.85%
Intermedia Capital Tbk.MDIA	63	66	-4.55%	N/A	0.00%	3.28%
Eka Sari Lorena TransportLRNA	180	185	-2.70%	N/A	0.00%	1.69%
Link NetLINK	3,240	3,200	1.25%	N/A	0.00%	25.10%
Chitose InternasionalCINT	238	244	-2.46%	N/A	0.00%	-6.30%
Magna Finance Tbk.MGNA	50	50	0.00%	N/A	0.00%	0.00%
Batavia Prosperindo Internasional Tbk.BPII	7,300	7,300	0.00%	N/A	0.00%	-15.12%
Mitrabara AdiperdanaMBAP	2,810	2,800	0.36%	N/A	0.00%	1.08%
Sitara Propertindo Tbk.TARA	50	50	0.00%	N/A	0.00%	0.00%
Bank Dinar Indonesia Tbk.DNAR	196	210	-6.67%	N/A	0.00%	6.52%
Blue Bird GroupBIRD	1,345	1,335	0.75%	N/A	0.00%	-9.73%
Soechi LinesSOCI	216	220	-1.82%	N/A	0.00%	-10.00%
Combined Total	24,386	24,350	0.15%			5.64%

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

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