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
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
CompanyP: 29 Mar 2021P: 28 Mar 2021Gain/LossP/E ttmYield %Gain/Loss YTD
Bank Panin SyariahPNBS83821.22%N/A0.00%-4.60%
Asuransi Mitra Maparya Tbk.ASMI925930-0.54%N/A0.00%-6.57%
Bank Ina Perdana Tbk.BINA1,5601,5500.65%N/A0.00%64.21%
Capitol Nusantara Indonesia Tbk.CANI1861860.00%N/A0.00%22.37%
Tunas Alfin Tbk.TALF31025820.16%N/A0.00%13.97%
Bali Towerindo Sentra Tbk.BALI7006901.45%N/A0.00%-6.04%
Wijaya Karya BetonWTON334344-2.91%N/A0.00%-20.85%
Graha Layar PrimaBLTZ4,6004,650-1.08%N/A0.00%53.85%
Intermedia Capital Tbk.MDIA6366-4.55%N/A0.00%3.28%
Eka Sari Lorena TransportLRNA180185-2.70%N/A0.00%1.69%
Link NetLINK3,2403,2001.25%N/A0.00%25.10%
Chitose InternasionalCINT238244-2.46%N/A0.00%-6.30%
Magna Finance Tbk.MGNA50500.00%N/A0.00%0.00%
Batavia Prosperindo Internasional Tbk.BPII7,3007,3000.00%N/A0.00%-15.12%
Mitrabara AdiperdanaMBAP2,8102,8000.36%N/A0.00%1.08%
Sitara Propertindo Tbk.TARA50500.00%N/A0.00%0.00%
Bank Dinar Indonesia Tbk.DNAR196210-6.67%N/A0.00%6.52%
Blue Bird GroupBIRD1,3451,3350.75%N/A0.00%-9.73%
Soechi LinesSOCI216220-1.82%N/A0.00%-10.00%
Combined Total24,38624,3500.15%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