T

he country’s biggest toll-road operator, state-owned Jasa Marga, is set to launch two series of bonds in October, aiming to raise Rp 1.5 trillion (US$166.5 million) to partly pay its debts and to finance toll road expansion, said an underwriter.

David Agus, a director of investment banking at Danareksa Sekuritas, said Monday the first bond series with a maturity of 10 years and with a coupon yield of between 8.75 and 9.95 percent a year was expected to generate Rp 1 trillion from the investing public.

The other one, a zero-coupon bond with a three-year maturity, was expected to raise Rp 500 billion. The coupon yield, which will be between 8.5 percent and 9.7 percent a year, will be paid at the end of the bond tenor. “But we will give a discount for investors in advance,” David added. “It means the bonds will be sold to investors below their nominal value,” he added.

Other than Danareksa, underwriters of the bond issuance include Bahana Securities and Mandiri Sekuritas. The bonds will be offered from Oct. 4 to 6. The two bonds will be officially listed in the Indonesia stock exchange (IDX) on Oct. 13.

“These are the first bonds issued by Jasa Marga after going public in 2007. The bond structure is pretty innovative, as there is a series with no coupons,” David told reporters. Jasa Marga has so far issued 28 bonds, 18 of which have matured. The other 10 will mature in the coming years.

“Jasa Marga needs more loans to support its expansion plans,” said the company’s financial director Reynaldi Hermansjah, citing several toll road projects in the pipeline including Semarang-Solo and Surabaya-Mojokerto routes, among others.

The Jasa Marga prospectus also showed that 25 percent of bond proceeds, or Rp 375 billion, will be used to expand the company’s non-toll road business. As reported earlier, Jasa Marga plans to set up
a joint venture with another company in the property and fiber optic business.

“Jasa Marga is also planning to double its revenue from non-toll road business, like property, as well as the fiber optic business,” said president director Frans S. Sunito, citing a partnership deal in the pipeline with the biggest telecommunication operator, state-owned Telekomunikasi Indonesia (Telkom). “We will jointly form a fiber optic unit,” he added.

According to the company’s prospectus, the remaining 5 percent (75 billion) of bond proceeds will be used to fund the company’s capital expenditure (capex). Jasa Marga has planned a Rp 2.4 trillion capex this year, mostly to fund operational needs.

In the first half of this year, Jasa Marga booked Rp 647.6 billion net profit, 63.65 percent higher compared to the same period last year, with revenue reaching Rp 2.1 trillion. The company operates about 531 kilometers of toll-roads in the country, or 72 percent of the total toll-roads in Indonesia.

Jasa Marga shares (JSMR) gained 0.81 percent, or 25 points, following the bonds issuance announcement, to close at Rp 3,100 per share on Monday, while the benchmark Jakarta composite index (JCI) lost 0.4 percent, or 13 points, closing at 3,370. Jasa Marga shares have climbed almost 70 percent this year, outperforming the broader JCI’s 31 percent jump.

Jasa Marga has a total market capitalization of about Rp 21 trillion. (est)