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ndustrial developer PT Bekasi Fajar Industrial Estate expects that proceeds from the initial public offering (IPO) will help the company purchase more land to anticipate growing demand from investors after a recent upgrade of the country’s credit rating to investment grade.

Bekasi Fajar is seeking up to Rp 326.52 billion (US$35 million) from selling 1.76 billion shares, or about 20.14 percent of its enlarged shares, to the public.

The company will offer the shares in the range of Rp 160 to Rp 185 a piece during an initial offering period scheduled on April 2 and 3 and is expecting to float the shares on the Indonesia Stock Exchange (IPO) on April 10.

The company will channel about Rp 225 billion of funds to be raised from the IPO to its subsidiary PT Bekasi Matra Industrial Estate, which will use the funds to purchase land in West Cikarang in Bekasi, West Java. Bekasi Fajar itself will use the remaining funds to acquire land in the same place.

“The land is located near the company’s current area in West Cikarang,” Ferry Budiman Tanja, the president director of Ciptadana Securities, serving as the underwriter for Bekasi Fajar’s IPO, said during a public expose on Tuesday.

Bekasi Fajar and its subsidiary currently hold a land bank of 816 hectares, including saleable areas of about 500 hectares.

“We are optimistic that many investors will be interested in purchasing Bekasi Fajar’s shares because there are increasing demands over land in industrial areas, which is supported by Indonesia’s upgraded credit rating to investment grade. There will be many investors asking for land to develop or build their factories,” Ferry said.

Bekasi Fajar corporate secretary Khrisna Deswara revealed that five companies had expressed their interest in buying industrial space in areas managed by his company.

“Most prospective investors are existing tenants who want to expand their businesses. We have just signed a deal with a new client, Kawasaki Industries,” Khrisna said, declining to provide further details.

Bekasi Fajar, established in 1989, is focusing on the development and management of an industrial area known as MM2100 industrial district in West Cikarang. The MM2100 is a project of PT Megalopolis Manunggal Industrial Development, a joint venture between Bekasi Fajar and Japanese company Marubeni Corporation. At this time, 150 national and multinational tenants are occupying MM2100.

The major tenants in MM2100 include PT Astra International and its subsidiaries, such as PT Toyota Astra Motor and PT Astra Daihatsu Motor. According to figures available on the public expose, Astra Group and JX Nippon Oil Corp. dominated Bekasi Fajar’s sales in 2011.

Bekasi Fajar director Wilson Effendy said that the company allocated a capital expenditure of about Rp 50 billion this year to improve its industrial spaces.

Wilson said that an unaudited report showed that the company booked around Rp 420 billion in sales in 2011.

“We are expecting that this year sales will reach Rp 500 billion,” Wilson said.