Duta Pertiwi to issue straight bonds
Duta Pertiwi to issue straight bonds
JAKARTA (JP): A publicly-listed property company, PT Duta Pertiwi, plans to issue straight bonds worth Rp 200 billion (US$86 million) in spite of the negative outlook facing the property sector in the debt market.
"The proceeds of the issue will be used to increase our working capital to support several projects yet to be started," the company's finance director, Anisa Himawan, said yesterday.
The projects include a condominium and shopping mall and the second phase of the Ambassador Kuningan super block, all in South Jakarta.
The construction of the condominium and shopping mall alone require an investment of US$60 million, she said.
Anisa said that the bonds will be offered either with a fixed interest rate of 18 to 18.25 percent per annum for five years or with a fixed rate of 18.75 percent for the first year and a floating rate for the remaining four years.
"The floating rate will be based on average interest rates on six-month deposits of six selected private banks, plus a fixed premium of 2.25 percent per annum for the second and third years and a minimum premium of 2.50 percent per annum for the fourth and fifth years," she added.
An executive of PT Trimegah Securities, the leading underwriter of the bond issue, said that April's issue will comprise 550 units with a nominal value of Rp 10 million, 350 units of Rp 50 million, 270 units of Rp 100 million, 100 units of Rp 500 million and 100 units of Rp 1 billion.
Anisa said the funds from the bond issue will not be used to refinance the company's short term debts.
"As a property company, we need a longer tenure of debt. So, I would say that bonds is an alternative source of financing which will help to increase our current ratio from 100 percent to approximately 200 percent."
On Oct. 31 last year, Duta Pertiwi's total debts reached Rp 800 billion, as compared to its total assets of Rp 1.3 trillion.
The company's commercial papers, which will expire soon, reached Rp 194 billion and its total offshore loans US$82 million.
Anisa said the company expected a 10 percent increase in its net profit this year from Rp 92 billion last year. (08)