Publicly listed building material and plastic maker Impack Pratama Industri expects to raise Rp 500 billion (US$38.2 million) from the issuance of medium-term bonds to finance the company’s expansion next year.

Lindawati, Impack Pratama’s finance and accounting director, said Monday that from the total proceeds of the bonds sale, Rp 117 billion would be used to purchase land, buildings and new machines, another Rp 140 billion would be used to refinance debts, and the remainder to boost working capital.

“We will purchase land and buildings in Cikarang, West Java,” Lindawati said on the sidelines of the company’s press briefing in Jakarta. The purchase of land and buildings was aimed at constructing a new warehouse and factory, which are expected enter operations in the third quarter of 2017 at the latest.

The company currently has four factories: two in Cikarang, one in Karawang, West Java, and one in Vietnam. It has a roof production capacity of 28,000 tons per annum and imports 70 percent of its raw materials from Thailand.

Its products include polycarbonate roofing, aluminum composite panels and PVC roofing, which are sold both at home and overseas.

Impack Pratama plans to offer two types of bonds to the public from Nov. 28 to 29. The A series will offer a coupon rate of 9.5 percent to 10 percent a year and will mature after three years, while the B series will offer 9.75 percent to 10.25 percent and will be due after five years. The interest payment will be disbursed quarterly.

The book building period for the bond sale runs from Nov. 2 until 14. The debt papers will be listed on the Indonesian Stock Exchange (IDX) on Dec. 5.

Impack Pratama has appointed BCA Sekuritas and Sucorinvest Central Gani as underwriters for the bond sale.

Impack Pratama aims to generate Rp 1.5 trillion in revenue by the end of next year, 23 percent higher than its target of Rp 1.15 trillion this year. Meanwhile, the company targets net profit of Rp 236 billion, which would mark a 43 percent increase from this year’s target of Rp 128 billion.

As of September, Impack Pratama saw its revenue drop 1.12 percent to Rp 858.1 billion from Rp 848.5 billion in the same period last year. However, the company’s profit increased 26 percent to Rp 82.8 billion from Rp 61 billion in the corresponding period.

Impack Pratama president director Haryanto Tjiptodihardjo said in order to meet the revenue target, the company would focus the marketing of the company’s roofing products and other building materials on infrastructure projects, livestock and agriculture.

“There will be more rest areas on toll roads, and we can provide roofs for that,” Haryanto said.

Meanwhile, for the agriculture sector, the company plans to build solar domes that can be used to dry crops like chilies, cloves, coffees and beans hygienically, he added.

“We will also introduce our products for animal shelter to dairy farm companies,” he said.

So far, the company has exported its roof products to 31 countries worldwide, including the US and countries in Latin America, Africa, the Middle East and Asia Pacific.

Shares in Impack Pratama, traded by the code IMPR, closed at Rp 1,060 apiece on Monday, having gained nearly 15 percent so far this year. That compares with the broader benchmark Jakarta Composite Index’s (JCI) 17.3 percent increase year-to-date. (wnd)

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