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Lorena makes unimpressive trade debut
Up and down: Indonesia Stock Exchange (IDX) president director Ito Warsito (right) chats with PT Eka Sari Lorena Transport president director GT Soerbakti (center) and company director Eka Sari Lorena Soerbakti after the listing of the companyâs shares on the IDX on Tuesday
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Up and down: Indonesia Stock Exchange (IDX) president director Ito Warsito (right) chats with PT Eka Sari Lorena Transport president director GT Soerbakti (center) and company director Eka Sari Lorena Soerbakti after the listing of the companyâs shares on the IDX on Tuesday. The transportation company floated 150 million shares or 42.86 percent of the enlarged capital with an offering price of Rp 900 (8 US cents) per share. (JP/Nurhayati) (IDX) president director Ito Warsito (right) chats with PT Eka Sari Lorena Transport president director GT Soerbakti (center) and company director Eka Sari Lorena Soerbakti after the listing of the companyâs shares on the IDX on Tuesday. The transportation company floated 150 million shares or 42.86 percent of the enlarged capital with an offering price of Rp 900 (8 US cents) per share. (JP/Nurhayati)
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span class="inline inline-none">Up and down: Indonesia Stock Exchange (IDX) president director Ito Warsito (right) chats with PT Eka Sari Lorena Transport president director GT Soerbakti (center) and company director Eka Sari Lorena Soerbakti after the listing of the company's shares on the IDX on Tuesday. The transportation company floated 150 million shares or 42.86 percent of the enlarged capital with an offering price of Rp 900 (8 US cents) per share. (JP/Nurhayati)
Bus operator PT Eka Sari Lorena Transport saw a lackluster response to its initial public offering (IPO) on Tuesday as its shares opened relatively flat before closing 13 percent below its IPO price.
Lorena (LRNA) made its debut on the Indonesia Stock Exchange (IDX) with its shares opening at
Rp 990 (8 US cents) . Soon after, the price slumped by about 17 percent to Rp 820. The shares hit a day low of Rp 775, or 16 percent below its initial prices.
Lorena concluded its first day of trading at Rp 780.
Trust Securities research head Reza Priambada said that Lorena's unimpressive first day was mainly due to investors' lack of knowledge on the company's business line, which is mostly known for intercity and interprovincial (AKAP) transportation services.
'Lorena's shares climbed by 10 percent from its book-building prices at opening, the increase drove unaware investors to sell off their shares purely to reap profits,' Reza said.
'This is common in land transportation shares trading, and such case also happened in TAXI [ticker code for taxi operator Express Transindo]. Once investors were more knowledgeable of the company's business, its shares went up consistently.'
Express made its way onto the LQ45, the list of 45 companies with the highest market capitalization and transaction value on the bourse, less than two years after going public in November 2012.
Reza said that what Lorena needed to do was keep investors informed on how its business operated. It was also important to show that the company also operated other business such as chartered buses.
Despite the unsatisfying debut, however, Lorena president director GT Soerbakti said that the company was still upbeat about the future, citing the importance of land transportation in the country.
'For an archipelagic nation like Indonesia, the presence of a decent transportation business is important to people,' he said. 'For that reason, we will keep on improving our services.'
Eka Sari Lorena released 150 million shares, representing 42.9 percent of its enlarged shares, to the public during the IPO held earlier this month. The company managed to secure Rp 135 billion from the IPO.
The company plans to use 81 percent of the IPO funds to support its fleet expansion, 16 percent to develop its city-bus Transjakarta depot and workshop in Ceger, East Jakarta, and the remaining 3 percent as working capital.
Lorena corporate secretary Andy Porman Tambunan said that the company planned to purchase around 70 new buses and revitalize about 20.
At the moment, its AKAP transportation service spans from Medan, North Sumatra, to Denpasar, Bali with a total of 161 buses.
It claims to control a 30 percent share in the Sumatra transportation market and 15 percent on Java. It will also target new markets in Kalimantan and Sulawesi, with higher use of the Trans-Sulawesi and Trans-Kalimantan highways.
Eka Sari Lorena is one of the Transjakarta operators in the capital city. The company operates 47 buses.
This year, Eka Sari Lorena hopes to book 41.3 percent growth in its revenue with the arrival of its new buses. With that target, revenue is estimated to reach Rp 233.88 billion. At the bottom line, it expects net profits to at least double, to Rp 29.34 billion, from a year ago.
