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Bahana Securities aims for 10% growth in underwriting business
State-owned securities company PT Bahana Securities aims for 10 percent growth in its underwriting business and is hoping to boost the number of its retail customers in 2017
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tate-owned securities company PT Bahana Securities aims for 10 percent growth in its underwriting business and is hoping to boost the number of its retail customers in 2017.
With the target, the company expects to manage up to Rp 85.25 trillion (US$6.4 billion) in securitization projects.
Bahana Securities president director Feb Sumandar said that as of February, the company had already secured five initial public offering (IPO) contracts, eight bond offering contracts, two rights-issue contracts and one tender offer contract.
Most of the contracts come from the subsidiaries of state-owned enterprises (SOE).
“Companies see the year 2017 as a window to enter the capital market because in 2018, the political risks will be higher as preparations for the 2019 presidential election take place,” Feb said during a press conference in Jakarta on Thursday.
Bahana has also secured contracts to facilitate cross-border acquisitions for two SOEs, which will expand their businesses into Southeast Asia and the Middle East. The companies are carrying out acquisitions to penetrate foreign markets.
“One company will begin its acquisition on March 1 in the Middle East, while the other company has just begun its acquisition negotiation process. We cannot mention the names of the companies or the size of the contracts because they are part of our confidentiality agreements,” Feb said.
In 2016, Bahana was involved in six equity securitization projects worth Rp 22.6 trillion as well as 29 bond securitization projects worth Rp 54.9 trillion.
According to data from Bloomberg, Bahana topped the list of equity underwriting businesses in terms of value with Rp 30.53 trillion from 2010 to 2015. The figure was equal to a 10 percent share in the underwriting market.
Global financial institution JPMorgan Chase & Co. came in second with Rp 25.92 trillion and a 6.38 percent share.
In addition to growing its underwriting business, Bahana is hoping to jack up the number of its retail customers by 25 percent this year. It has around 17,000 retail customers at present, but only 20 percent of them actively trade everyday.
Unlike other securities firms that run multiple branches to cater to more retail customers, Bahana only has one branch in Surabaya, East Java, and is heavily focused on institutional customers.
Bahana Securities finance and operations director Wiwit Gusnawan said it would partner with companies to attract their employees through the employee stock ownership program (ESOP).
“We are currently working with around 10 public companies for their ESOP. Usually, when the employees receive reward stock, they keep it or sell it for cash. We will approach them and advise them to reinvest it by trading the stock in our system,” he said.
