Kobexindo Tractors Plans Rp 500b IPO to Boost Working Capital
Kobexindo Tractors, a heavy equipment distributor, aims to raise as much as Rp 500 billion ($54 million) by selling shares in an initial public offering next month.
Kobexindo plans to sell 858 million shares, a 30 percent stake in the company. It will offer the shares at Rp 380 to Rp 520 apiece to investors in Indonesia and elsewhere in Asia next month.
“Besides [targeting] domestic investors, we will also do a roadshow in Malaysia, Singapore and possibly Hong Kong,” said Johanes Soetikno, managing director at Valbury Asia Securities, one of the underwriters. Mandiri Sekuritas and Lautandhana Securindo were also hired to help conduct the IPO.
The company will offer the shares to investors from June 20-22, with listing planned on the Indonesia Stock Exchange (IDX) on June 28.
The company will use 41 percent of the IPO’s proceeds to boost working capital, while 34 percent will be used for capital expenditure.
“We are opening five new branches and expanding three of our existing branches,” said Martio, a Kobexindo director.
He said because 90 percent of the company’s sales were to the mining industry, Kobexindo would open branches in cities close to mines. He said the company was opening offices in cities including Makassar in South Sulawesi and Palembang in South Sumatra.
Martio said heavy equipment sales were expected to reach 1,300 units this year from 975 units last year.
The company posted total revenue of Rp 39 billion in the first quarter this year. Martio did not provide a net income figure for the first quarter.
Kobexindo forecast its revenue to increase to Rp 2 trillion this year from last year’s Rp 1.3 trillion. Its net income rose to Rp 80 billion last year from Rp 20 billion in 2010.
Humas Soputro, president director of Kobexindo, expressed confidence in the Indonesian coal market and that strong results there would boost demand for heavy equipment.
Indonesia’s coal mining association predicts coal production will reach 350 million tons this year.
“Based on the mining activity, we believe demand for heavy equipment will continue growing,” Humas said.
He added that the company’s market share currently stood at only 6 percent, but that low starting point meant it had much room to grow.
Heavy equipment giant United Tractors is already listed on the IDX. Its shares are down 23 percent since the start of April.