The state owned electricity company (PT Perusahaan Listrik Negara/PLN) set the IDR3 trillion bond coupon at 9.15-10.81 percent level. Meanwhile, the company will seek another IDR10 trillion fund to cover IDR70 trillion capital expenditure this year.
The offered bonds consist of IDR2.5 trillion conventional bonds and IDR500 billion sukuk ijarah. PLN issues A series bond with 5 years tenure and B series with 12 years tenure.
The A series coupon is based on the government bond of FR027 + (100-175) basis point, or 9.15-9.9 percent. The B series refers to FR043+(100-175) basis points or at 10.06-10.81 percent.
Sukuk ijarah also has two series, A and B with yield equals to the conventional bond. PLN appointed PT Danareksa Sekuritas, PT Mandiri Sekuritas, and PT Trimegah Securities as the underwriters.
The company increases the investment along with the soaring demand for national electricity at an average of 9 percent per year in the upcoming 10 years. The power supply in Indonesia is limited and thus it gives big opportunity to the company.
The A series coupon is based on the government bond of FR027 + (100-175) basis point, or 9.15-9.9 percent. The B series refers to FR043+(100-175) basis points or at 10.06-10.81 percent.
Sukuk ijarah also has two series, A and B with yield equals to the conventional bond. PLN appointed PT Danareksa Sekuritas, PT Mandiri Sekuritas, and PT Trimegah Securities as the underwriters.
The company increases the investment along with the soaring demand for national electricity at an average of 9 percent per year in the upcoming 10 years. The power supply in Indonesia is limited and thus it gives big opportunity to the company.
The company will seek another IDR10 trillion to cover the IDR60-70 trillion capital expenditure this year to meet IDR10 trillion net profit this year or the same as that of last year.
The capital expenditure is mostly to be allotted for the development of networks. PLN will use up all the capital expenditures instead of being allotted to the government 10,000 megawatt (MW) program.
Fitch Ratings has today commented that although the upcoming increase in Indonesia's electricity prices is positive for PT Perusahaan Listrik Negara (PLN), the introduction of fully cost-reflective tariffs will remain a challenge for the government. The Minister for Energy and Mineral Resources has announced that electricity tariffs will be increased by an average of 10% from 1 July 2010 which Fitch expects will improve PLN's operating margins and the funding position for its substantial investment program.
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