TheJakartaPost

Please Update your browser

Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.

Jakarta Post

Nirwana going public to fund expansion

Low-cost housing developer PT Nirwana Kharisma announced Wednesday its plans to sell a 30 percent stake through an initial public offering (IPO) scheme this month in a bid to help finance its expansion

Agustina Wayansari (The Jakarta Post)
Jakarta
Thu, February 28, 2008

Change text size

Gift Premium Articles
to Anyone

Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
Nirwana going public to fund expansion

Low-cost housing developer PT Nirwana Kharisma announced Wednesday its plans to sell a 30 percent stake through an initial public offering (IPO) scheme this month in a bid to help finance its expansion.

Nirwana finance director Leny Chandra said the firm expected to rake in some Rp 46 billion (US$5 million) in proceeds from the sale.

"We will offer shares with an initial price of between Rp 100 and Rp 140," Leny said after a due diligence meeting.

The company will also issue a warrant with a one to one ratio.

A warrant is a security which entitles the holder to buy the stock from the company that issued it at a specified price, usually higher than the stock price at time of issue.

Nirwana has appointed PT Investindo Nusantara Sekuritas as its underwriter for the IPO.

Leny said the company was expected to gain as much as Rp 90 billion from the IPO and warrant deal.

Some 75 percent of proceeds would be used to finance the Puri Nirwana residential project in Cikarang, and the remaining 25 percent for Puri Kosambi (1 and 2) projects in Cibinong, as well as Puri Nirwana 3 project, in Kerawang, all in West Java.

"We will actually need up to Rp 200 billion to finance the Puri Nirwana project, which covers a total 81 hectares," Leny said.

The company would plug the remaining financial needs with bank loans, internal cash and customer advance payments. The firm has already secured loans from state-owned Bank Tabungan Negara, which specializes in financing low-cost housing projects.

Lenny estimated the company's capital expenditure would reach around Rp 220 billion.

PT Investindo Nusantara Sekuritas associate director Fajar R. Soeharto said the book building would be conducted between Feb. 28 and March 14, and an official listing would be made April 22, 2008.

Fajar was positive about the offer because Nirwana primarily engages in constructing low-cost houses, which carry less risk than high-cost residential, he said.

At present, Nirwana has secured orders for 1,000 units in the Puri Nirwana project, mainly from the corporate sector which would supply houses to employees.

As of October last year, Nirwana recorded sales revenue was Rp 9.68 billion and net profit was Rp 2.4 billion.

This year, the company is targeting to tap a sales revenue of Rp 149.6 billion and net profits of more than Rp 11 billion.

Your Opinion Matters

Share your experiences, suggestions, and any issues you've encountered on The Jakarta Post. We're here to listen.

Enter at least 30 characters
0 / 30

Thank You

Thank you for sharing your thoughts. We appreciate your feedback.

Share options

Quickly share this news with your network—keep everyone informed with just a single click!

Change text size options

Customize your reading experience by adjusting the text size to small, medium, or large—find what’s most comfortable for you.

Gift Premium Articles
to Anyone

Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!

Generating Questionnaires

Thank You

Thank you for sharing your thoughts.
We appreciate your feedback.