IRSX, BMAS, and BUVA to Conduct Rights Issues: Which Is Most Attractive?

A number of issuers are again utilising rights issues to strengthen capital and support business expansion. Among them are PT Aviana Sinar Abadi Tbk (IRSX), PT Bank Maspion Indonesia Tbk (BMAS), and PT Bukit Uluwatu Villa Tbk (BUVA). Although all three are conducting rights issues, they differ in the scale of share issuance and the intended use of proceeds. These conditions mean the risk profiles and prospects of each issuer need to be carefully examined by investors.

Head of Research at KISI Sekuritas, Muhammad Wafi, assesses that BMAS has a relatively more attractive risk-reward profile compared with IRSX and BUVA. This is because BMAS is issuing new shares in a more moderate amount, and the proceeds from the corporate action will be used to strengthen working capital for credit distribution. According to Wafi, the use of funds for credit expansion also makes the impact of BMAS’s corporate action easier to project in terms of business growth. ‘The additional capital can be directly linked to increased credit distribution capacity, making it easier to see growth potential after the corporate action,’ Wafi told Kontan on Friday (21/8/2026).

Meanwhile, IRSX carries a much larger dilution risk. The company plans to issue a maximum of 12.39 billion new shares, equivalent to 66.67% of paid-up capital. The large size of the new share issuance means investors need to scrutinise the company’s ability to generate returns from the funds raised. Moreover, the use of IRSX’s rights issue proceeds remains fairly general, namely for capital expenditure and working capital. Wafi believes the large potential dilution means IRSX’s corporate action requires strong proof in terms of business performance. ‘The larger the new share issuance, the greater the demand for earnings improvement so that the value per share remains attractive for existing shareholders,’ he said.

As for BUVA, it has a higher risk profile in terms of its financial condition. The company has set a rights issue exercise price of Rp250 per share and is targeting proceeds of around Rp1.53 trillion. Wafi highlighted BUVA’s interest coverage ratio (ICR) of only 0.42 times. This ratio indicates that the company’s EBITDA is not yet able to fully cover interest expenses. This condition means the proceeds from BUVA’s rights issue are seen as serving more to strengthen the financial structure rather than as pure expansion capital. This is because several of the company’s new projects still require time until 2028-2029 to complete, while interest expenses are already accruing.

Of the three issuers, Wafi places BMAS as the most defensive choice. The more measured use of funds and relatively moderate dilution level are the main considerations. Meanwhile, investors are still considered to need to wait for further information regarding IRSX’s use of funds before being able to assess the potential value creation from the corporate action. For BUVA, Wafi advises investors to be more cautious given that fundamental conditions and the ability to pay interest remain challenges. ‘With a low ICR and controlling shareholders not exercising all their rights, we choose to avoid BUVA until there is clarity regarding a fundamental turnaround,’ he said.

Dilution risk is also an important factor to consider after a rights issue. For IRSX, a dilution level of up to 66.67% has the potential to significantly change the value per share for shareholders who do not exercise their rights. BMAS has a lower dilution level. However, investors still need to see whether credit growth will be able to generate additional profit commensurate with the increase in the number of shares outstanding. For BUVA, Wafi estimates that price pressure may still continue. He notes the theoretical ex-rights price (TERP) is around Rp658 from a share price of Rp760, while there is potential overhang from the backstop scheme of around Rp938.57 billion, or about 61% of the total issuance.

IRSX, according to Adrian, is more suitable to be viewed as a growth-story investment. The company is carrying a narrative of business transformation into the digital, artificial intelligence (AI), and entertainment sectors, but execution still needs to be proven through fundamental performance. BMAS is considered to have a more defensive profile because it operates in the banking sector and the rights issue proceeds are directed at enlarging its core business. ‘The additional capital is intended for core business expansion that has the potential to improve profitability ratios, while the dilution level is still relatively moderate,’ Adrian said.

BUVA has a fairly concrete use of funds. However, investors still need to pay attention to the company’s ability to generate cash flow to support funding needs and expansion. In general, Adrian assesses that the use of rights issue proceeds for capital expenditure and business expansion has the potential to have a greater impact on revenue growth in the medium to long term compared with funds used only to cover working capital needs or debt obligations. Therefore, BMAS is considered the most attractive issuer to examine among the three corporate actions, especially for investors with a medium to long-term investment horizon. For trading recommendations, Adrian gives a trading buy recommendation for BUVA with a short-term price target of Rp815 per share.