Will IPO, Mutagung Lestari Aims For IDR 103.71 Billion Funds

Illustration of the Indonesian capital market (Photo: Doc. Antara)

PT Mutuagung Lestari Tbk (MUT) plans to conduct an Initial Public Offering (IPO) on the Indonesia Stock Exchange (IDX), by targeting to be able to obtain fresh funds worth IDR 103.71 billion.

President Director of MUTU International Arifin Lambaga explained that the company will release a maximum of 942.85 million shares or the equivalent of 30 percent of the company's issued and fully paid capital after the IPO.

During the initial offering or book building period, the company in the field of testing services, inspection and certification offers a price range of IDR 105-IDR 110 per share, so it is estimated that it will receive fresh funds of around IDR 99.00 billion to IDR 103.71 billion.

He continued, the company will carry out the public offering process from 12 to 24 July 2023, with an estimate that it will be recorded and will start trading on the IDX on 9 August 2023.

Simultaneously, the company also issued a maximum of 235.71 million Series I Warrants worth IDR 76.37 billion, with a ratio of 4:1, with each holder of four new shares will receive one warrant with an exercise price of IDR 324 during the period from February 9, 2024 to August 8, 2025.

"The company has obtained a pre-effective permit and publication permit from the Financial Services Authority (OJK) on July 11, 2023," said Arifin quoting Antara.

In the IPO, the company appointed PT Trimegah Sekuritas Indonesia Tbk as the Implementing Underwriter.

Arifin explained, as much as 66 percent of the proceeds from the IPO will be used as capital expenditure to develop existing laboratories and new laboratories, which will later become branch offices after obtaining accreditation.

The remaining 34 percent plus all proceeds from the implementation of the warrant will be used for operational expenditures to support the company's business, both in the existing market and in the new market, including improvement and development of human resources according to three strategic focuses, including Green Economy, Shariah Economy and Digital Economy.

"We see good potential for the TIC industry both in Indonesia and globally. The global value of the TIC market in 2027 is estimated to reach 270 billion US dollars (US) or around Rp. 4,000 trillion, while the current value of the Indonesian market has only reached Rp. 20 trillion," said Arifin. "It is optimistic that the TIC industry will continue to grow exponentially in the future in line with the downstream policy of industry, green economy development, digitalization, development of the sharia economy, increasing trade volume and also increasing consumer awareness of the importance of certification.

According to him, one of the leading sectors that is the company's strength is natural resources and green economy, which the company plays a role in strengthening the values possessed by processing corporations such as palm oil, wood, food and others by providing a touch of testing, inspection and certification.

On the same occasion, Director of MUTU International, Irham Budiman, said that the company has a great opportunity to take advantage of the development of the carbon market, because of its enormous potential.

According to him, the value of carbon trading in the future is estimated at IDR 8,400 trillion.

"If we look at the current trend about the verification and validation of greenhouse gases, then there is a carbon tax, and most recently, the new carbon exchange will be launched at the end of the third quarter of this year," said Irham.

Meanwhile, Director of MUTU International Sumarna explained that the company posted revenues of IDR 281.82 billion during 2022, or an increase of 24.47 percent year on year (yoy) compared to 2021 which amounted to IDR 226.41 billion.

Along with that, the company posted a profit for the year which jumped 90.38 percent (yoy) to Rp36.78 billion during 2022, from the previous Rp19.32 billion in 2021.