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Jakarta Post

Two companies list shares on IDX despite pandemic-hit market

  • Riska Rahman

    The Jakarta Post

Jakarta   /   Wed, April 8, 2020   /   05:50 pm
Two companies list shares on IDX despite pandemic-hit market An employee walks pass a stock price screen at the Indonesia Stock Exchange (IDX) building in Jakarta on March 11. (Antara/Galih Pradipta)

Two companies went forward with their plans to list their shares on the Indonesia Stock Exchange (IDX) on Wednesday despite the COVID-19 pandemic that has rocked global and domestic stock markets.

Property developer PT Karya Bersama Anugerah and yarn producer PT Sejahtera Bintang Abadi Textile became the 20th and 21st companies listed on the domestic bourse this year and the second and third companies to list their shares virtually amid the government’s large-scale social restrictions to prevent further spread of the highly contagious disease.

Karya Bersama Anugerah, listed under the code KBAG, recorded a 35 percent jump in share price upon opening to Rp 135 (8 US cents) apiece from Rp 100 while Sejahtera Bintang Abadi (SBAT) soared 34.29 percent to Rp 141 just 30 minutes after its shares were available for trading.

In a written statement obtained by The Jakarta Post, Karya Bersama plans to use the proceeds from its initial public offering (IPO) of around Rp 215 billion to add to its land bank in the Balikpapan area in East Kalimantan. Outside of Balikpapan, the company currently owns a total of 0.7 hectares of land in West Jakarta and another 150 hectares of land in Jonggol, West Java.

“We will also use the proceeds to fund our capital expenditure [capex] and finish several of our ongoing projects,” the company said in the statement, adding that one of the projects included a townhouse complex in central Balikpapan.

The company has expressed optimism that the project will have a positive impact on its financial performance as it expects the government’s upcoming new capital city project located near Balikpapan to increase real estate values in the area.

Read also: To buy it or not: Retail investors are torn amid volatile stock market

Karya Bersama pocketed Rp 613 million in net income as of September 2019 as it booked Rp 15.98 billion in revenue during the period.

In the meantime, Sejahtera Bintang Abadi managed to raise a total of Rp 44.63 billion in fresh funds from the sale of 425 million shares during its IPO, the company said in a statement.

The company plans to use about 78.55 percent of the IPO proceeds to buy new open-end machines, a finisher draw frame and other plant to produce its recycled-base material yarns. The company will also use the remaining 21.45 percent of the proceeds as capex to buy raw materials and fund marketing costs, among other things.

As of September 2019, the company recorded a total of Rp 227.71 billion in revenue. However, it still recorded a loss of Rp 3.84 billion during the period.

Although the market is currently in its least favorable condition, IDX assessment director I Gede Nyoman Yetna said companies were still interested in seeking fresh funds from the stock market.

“These companies chose to offer their shares to the public as they need more funds to help develop their businesses,” he told the press by text message.

The IDX main gauge, the Jakarta Composite Index (JCI), dropped 3.18 percent on Wednesday, having lost more than 26 percent of its value so far this year.