Prajogo Pangestu Conglomerate Company Bonds Worth IDR1 Trillion Experiencing Excess Demand

Illustration. (Photo: Doc. Antara)

JAKARTA - The bonds of a petrochemical company, PT Chandra Asri Petrochemical Tbk (Chandra Asri), are oversubscribed. This reflects the strong participation interest of all retail, banking and institutional investors in the three series of bonds issued by the TIPA-coded company, which are worth IDR1 trillion.

Quoted from Chandra Asri's official statement on the information disclosure page of the Indonesia Stock Exchange (IDX), Friday, May 7, three series of bonds were issued with maturities of 3, 5 and 7 years to fund working capital to boost business growth. However, the company owned by the Prajogo Pangestu conglomerate did not specify how much investor demand was excess.

This issuance is directed at a longer tenor to better suit the company's long-term growth plan, with a coupon in rupiah currency of 7.8 percent for series A with a 3 year tenor of IDR 50 billion, 8.5 percent for series B with a 5 year tenor of IDR IDR 587.95 billion, and 9.0 percent for a series C with a 7-year tenor worth IDR 362.05 billion.

"This is the first bond issuance after Chandra Asri announced its success in controlling its business during the COVID-19 pandemic smoothly to provide solid financial performance and maintain a strong balance sheet," said Chandra Asri President Director Erwin Ciputra.

PT BCA Sekuritas, PT DBS Vickers Sekuritas Indonesia, and PT Bahana Sekuritas supported the company in the success of the offering, with PT Bank Tabungan Negara (Persero) Tbk (BBTN) as Trustee.

This transaction marks Chandra Asri's success in entering the domestic fixed income market, as part of the Company's Bonds III Sustainable Public Offering Program approved by the Financial Services Authority (OJK) with a funding target of IDR 5 trillion during 2020 to 2022.

"We are grateful to our bond investors who are very supportive of our growth plans, which have allowed our rupiah bond program to continue to grow stronger. With more than IDR 6.1 trillion issued since its inception and many investors are happy to date," he said.

The bond issuance again received an idAA- rating from Pefindo. The issuance will be used to fund Chandra Asri's working capital in line with the company's preparations for sustainable growth to meet the needs of the domestic market.

Last year, this subsidiary of PT Barito Pacific Tbk (BRPT) posted a net profit of US $ 51.35 million or equivalent to Rp745 billion. This figure soared to 124.42 percent from the previous year's acquisition of 22.88 million US dollars or Rp332 billion.

However, the increase in net profit was not accompanied by TPIA's revenue growth in the same period. Chandra Asri recorded a net income of 1.80 billion US dollars or Rp26 trillion in 2020, a decrease of 3.96 percent from 1.88 billion US dollars or Rp27 trillion in the previous year.