The Dow Jones Up 39.3 Points At New Highs By Energy Sector Issuers.
Regional exchanges traded mixed this morning yet can support IHSG in the middle continued selling of foreign investors. IHSG dropped close to strong diagonal support line. Break below the previous low at 5.813 potentially triggering a further correction.
ADHI - Acquisition of the contract
PT Adhi Karya (ADHI) booked a new contract worth Rp 28.6 trillion in 8M 2017. The increase in new contracts is supported by the value of the LRT project worth Rp 19.7 trillion. In August ADHI was awarded a new contract from the Trans Park Bekasi project in West Java worth Rp 596.2 Billion, the Grand Mosque Batam project in Riau Islands worth Rp 237.1 Billion, and the Kualalanamu Toll Section 7B project in North Sumatra worth Rp 225.9 Billion.
BEST - Sales plan for warehousing business lines
PT Bekasi Fajar Industrial Estate (BEST) plans to sell its warehousing business line. BEST will sell a 51% stake in the joint venture which is the result of cooperation with Daiwa House Industry Co. BEST assessed the contribution of the warehousing business to the company's performance is still very minimal. In addition, the company also wants to focus on industrial development. The proceeds from the divestment will be used for the development of industrial estate. Later, Daiwa House will take over the ownership of BEST in the joint venture. Daiwa will become the sole operator of the warehousing company.
KAEF - External funding
PT Kimia Farma (KAEF) is exploring external funding worth Rp 2 Trillion to Rp 3 Trillion higga 2018. For the initial phase of the company will issue medium term notes (MTN) phase I of 2017 worth Rp 400 Billion and phase II with target Rp 600 Billion in year 2018. The Company is also reviewing other funding options to cover external funding needs of Rp 2 Trillion to Rp 3 Trillion until 2018. The fund will be used to acquire a portion of the company's shares in Saudi Arabia, Dwaa Medical Limited Company and will also be used for debt refinancing with the aim of reducing the interest rate of the company's loan.
TRAM - Acquisition of 2 coal mines
PT Trade Maritime (TRAM) acquired 6.25 billion shares (50.01% shares) of PT SMR Utama (SMRU) with an estimated acquisition value of Rp 3.13 trillion. Previously, the company also acquired 100 percent of PT Gunung Bara Utama's coal mining company from PT Semeru Infra Energi worth Rp 2.48 trillion. The acquisition fund is derived from the issuance of new shares through the rights issue (HMETD) of 40 billion shares of the company so that when viewed from the acquisition value and the number of rights issue shares issued, the minimum price of rights issue amounting to Rp 150 per share . In addition, the company has also completed the process of debt restructuring, among others, to ICBC of US $ 8.27 Million and to Bank Mandiri Syariah of US $ 768,470 which each renewed its maturity so that the company's liquidity will improve.
WSBP & WTON - A plan to limit the use of construction materials
The Government through the Minister of Public Works and Public Housing (PUPR) plans to limit the use of up to 50% of the construction materials of its own subsidiaries to provide opportunities for private precast manufacturers. This has the potential to negatively impact PT Waskita Beton Precast (WSBP) and PT Wijaya Karya Beton (WTON).
WTON - New contract
PT Wijaya Karya Beton (WTON) has won a new contract worth Rp 3.2 trillion in 8M 2017. The value is equivalent to 45.7% of this year's target of Rp 7 trillion. Although still far from the target, but management is still optimistic the target can be achieved. Most of the contracts come from the type of energy and infrastructure projects. In the future, WTON will focus more on contracts in the energy sector such as power generation due to the large value and the payment from project givers is relatively fast. In addition, WTON will also increase the production capacity of precast concrete at a factory located in South Lampung with a production capacity of approximately 50,000-60,000 tons per year.