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Jakarta Post

Two newcomers soar on Indonesian bourse despite market see-saw

  • Yunindita Prasidya

    The Jakarta Post

Jakarta   /   Wed, April 15, 2020   /   03:06 pm
Two newcomers soar on Indonesian bourse despite market see-saw A worker cleans the Indonesia Stock Exchange (IDX) building in Jakarta on March 2. (Antara/Galih Pradipta)

Share prices of two companies, financial service provider PT Bhakti Multi Artha and property developer PT Bumi Benowo Sukses Sejahtera, have soared by up to 35 percent during their market debut despite weakening stock index on Wednesday. 

The shares of Bhakti Multi, listed on the Indonesia Stock Exchange (IDX) under the code BHAT, rose by almost 35 percent to Rp 139 (1 US cent) from its initial public offering (IPO) price of Rp 103, just a minute after morning trading opened.  

Bumi Benowo’s shares, traded under the code BBSS, also climbed 35 percent to Rp 162 per share, from its initial price of Rp 120.

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As the share prices of the two companies had reached the limit of percentage increase for a single-day transaction for their price range, bids higher than the peak prices will automatically be rejected as regulated in the exchange's auto rejection regulation. 

The IDX’s main gauge, the Jakarta Composite Index (JCI), meanwhile, jumped during morning trade before succumbing back to negative territory as trading went on. The index plunged by more than 2 percent as of 2:10 p.m. and had lost almost 27 percent of its value so far this year amid concerns of economic blows during the COVID-19 pandemic.

Bhakti Multi Artha president director Dimas Teguh Mulyanto said during a virtual ceremony of the company’s listing on Wednesday that it planned to bring out new financial products for its customers. 

“Going forward, we will continue to develop insurance products and other financial services to meet the dynamic needs of the public,” Dimas noted. 

During its IPO, Bhakti Multi raised Rp 206 billion, which will be used to increase the capital of its subsidiary company, PT Asuransi Jiwa Nasional. 

“With the listing, the company has a greater chance to conduct expansion such as strengthening capital and adding investment portfolio,” Dimas said in a written statement published on Wednesday. 

Read also: Millions to lose jobs, fall into poverty as Indonesia braces for recession

The company’s subsidiary, operating in the life insurance sector, has more than 900,000 customers. 

Bumi Benowo, on the other hand, raised Rp 156 billion from its IPO, which took place earlier this month and planned to use the majority of its proceeds to purchase plots of land. 

“Our company operates in construction, warehousing and shop-houses and so far owns 10 hectares of land from a total of 30 hectares allowed in the location permit,” Bumi Benowo Sukses Sejahtera president director Felix Soesanto said during the virtual ceremony on Wednesday. 

The company planned to allocate 88 percent of the funds to purchase a 59,000-square-meter plot of land in Kebomas district, Gresik, East Java. The land, worth around Rp 130 billion, will be developed into a warehouse area. The rest of the funds will be used as working capital for the company’s development. 

The company aims to increase sales by 579.1 percent this year and see a net profit increase of 808.3 percent, of which 20 percent of the net profit will be disbursed as dividends to  shareholders. 

According to a written statement obtained by The Jakarta Post, the company expressed optimism about its business growth as it was supported by the strong prospects of e-commerce business and third party logistics, as well as its lands’ strategic location to transportation hubs, which would ease distribution. 

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Bumi Benowo and Bhakti Multi became the 25th and 26th companies, respectively, to be listed on the IDX this year and the seventh and eight companies to do so with a virtual officiating ceremony as the government issued large-scale social restrictions amid the COVID-19 outbreak. 

“It is a very strategic decision for the company to engage with the public through an initial public offering and to join elite companies on the Indonesia Stock Exchange,” IDX assessment director I Gede Nyoman Yetna said in the virtual ceremony on Wednesday. 

“We hope these two companies can bring optimal shareholder value and are capable of contributing to the growth of the national economy,” he added.