Fitch Ratings has awarded Indonesia's top-class airline Garuda Indonesia the national long-term 'A (idn)' rating with a stable outlook. This upgrade represents yet another example of foreign appreciation of the airline's good corporate performance. Garuda Indonesia has experienced a remarkable transition within the last decade as it transformed from a company that was banned to fly to the European Union into one of Indonesia's success stories.

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Garuda Indonesia, Indonesia's national airline, is planning to sell bonds worth IDR 2 trillion (US $205.1 million) in Quarter II - 2013. The bonds, which are denominated in IDR rupiah, will have a five-year maturity. Proceeds of the bond issuance will be used by the company for capital expenditure (capex), which includes investments in aircrafts and working capital. The airline is currently searching for a lead underwriter through a tender.

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Garuda Indonesia (GIAA), one of Indonesia's biggest airlines, posted a 100 percent increase in net profit to US $145.4 million in 2012 from US $72.7 million a year earlier. Operating profit of the company rose 82 percent to US $110.8 million from US $64.2 million in 2011. These numbers were supported by a 19.6 percent increase in passengers from 17.1 million in 2011 to 20.4 million last year, while its seat load factor rose to 75.9 percent from a previous 75.2 percent.

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Governments’ social and business restrictions (imposed in the context of preventing the further spread of COVID-19 in society) and people’s concern over the virus have damaged both the tourism and transportation industry in an unprecedented way.

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Indonesia's air transport industry is about to see a big change as the nation's national flag carrier Garuda Indonesia said it will take over operational control of the rival Sriwijaya Group. This move seriously boosts the Garuda Group's share of the fast-growing domestic aviation market.

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Indonesia's flag carrier Garuda Indonesia, a state-controlled five-star airline that is listed on the Indonesia Stock Exchange, requested to postpone the arrival of new airplanes in an attempt to improve the company's corporate earnings. Pahala M. Mansury, General Director of Garuda Indonesia, said the order (the number of airplanes) has not been revised, neither has the company's fleet plan (that runs to 2020) been changed. Only the timing of arrival of five planes has been altered.

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Indonesia's national flag carrier Garuda Indonesia is ready to open a new flight route between the famous island of Bali and Chengdu (the provincial capital of Sichuan province in Southwest China) in order to cater Chinese passengers going to Bali. Arif Wibowo, General Director of Garuda Indonesia, informed that this new international route is scheduled to be opened in January 2017. He added that Chengdu has great potential in terms of boosting foreign tourist arrivals to Bali. Garuda Indonesia already flies passengers from Beijing, Shanghai and Guangzhou to Jakarta.

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Indonesian financial authorities are considering to ease foreign ownership limits for local Islamic banks and to promote new sharia-compliant financial tools in an effort to make the Islamic finance industry more attractive to foreign investors and the Indonesian population. Despite having the world’s largest Muslim population and being a dynamic emerging economy, Indonesia plays only a very minor role in the global Islamic banking industry. Meanwhile, domestically, Islamic banking still seriously lags behind conventional banking.

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The Indonesian rupiah exchange rate depreciated 0.54 percent to IDR 11,822 per US dollar in the past week (based on the Bloomberg Dollar Index). Several internal and external factors influenced the currency’s performance over the past week, such as increased US dollar demand from local Indonesian companies, Bank Indonesia’s decision to leave the BI rate unchanged and the improving US economy. Lastly, the structural current account deficit (triggered by expensive oil imports) remains a problem for investors.

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What is the most important corporate news from Indonesia on Tuesday 12 August 2014? Here we present the daily market roundup. This includes following companies: Bank Internasional Indonesia, Kalbe Farma, Sri Rejeki Isman (Sritex), Phapros, Siloam International Hospitals, Asia Resource Minerals, Bumi Resources, Kao Corporation, Garuda Indonesia as well as June 2014 retail sales (Bank Indonesia survey), and the 10 years’ imprisonment demand for suspended Banten Governor Ratu Atut Chosiyah.

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The mysterious disappearance of Malaysia Airlines flight MH370 on Saturday 7 March 2014 reminds us that flying does not go without risks. Although it is popularly said that flying in an airplane is safer than driving in a car - and despite the fact that Malaysia Airlines is a world-class airline - it is worth taking a closer look at the current state of aviation in the Asia Pacific, Indonesia in particular, as air traffic in the Asia Pacific has been booming (and budget airlines mushroomed) in recent years due to the expanding middle class.

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As companies' financial results of 2013 slowly start to be released, two reports - so far - have raised eyebrows due to significant declines in net profit. These are publicly listed, but majority state-owned, airline Garuda Indonesia and fully state-owned electricity firm Perusahaan Listrik Negara (PLN). Both companies felt the impact of the sharply depreciating Indonesia rupiah exchange rate. The currency fell over 21 percent against the US dollar in 2013 due to capital outflows amid looming US tapering and current account deficit concerns.

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Garuda Indonesia, the country's top-class airline, is planning to conduct a rights issue in the first quarter of 2014. Through this corporate action, which has already been approved by the shareholders, the state-controlled company aims to raise IDR 2 trillion (USD $162.6 million). For 2014, the airline plans to allocate IDR 4 trillion in capital expenditure (capex) for business expansion. About half of this amount should originate from funds generated through the rights issue.

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