Kereta Api Indonesia Issue Bond IDR 2 Trillion. As well as, Kereta Api Indonesia (KAI) (Persero) will return to the exchange floor to seek fresh funds through the issuance of bonds. This is the second bond of the SOE company, after the first issued in November 2017 worth IDR 2 Trillion. KAI Management will use the proceeds to pay debts and rejuvenate facility.
Didiek Hartantyo, KAI Finance Director estimate, the bond issuance plan will receive an effective from the Financial Services Authority (OJK) December 5, 2019. The general offer was on December 6-9, and fixed allotment on December 10, and the listing on the Indonesia Stock Exchange (IDX) on December 13, 2019. Target fund of IDR 2 Trillion, obviously Didiek.
KAI Management is optimistic that the bonds will be successful as the first. At that time, the demand for bonds reached IDR 5.2 Trillion, or oversubscribed up to 2.5x of the value offered. This is because KAI financial performance is good. The number of passenger and freight transport continues to increase from year to year.
Revenues grew by 25.5%. Didiek claimed, for five years since 2014, KAI recorded revenue growth with a compound annual growth rate (CAGR) of 25.5% and the average net profit growth with CAGR of 22.3%. At the same time, the number of assets also expanded with CAGR 20.1% and accompanied by equity growth of 30.2%. The management will use the Bonds fund around IDR 1.2 Trillion to pay a portion of the loan principal in banking.
That is the Bank of HSBC Indonesia. Recorded in the 3Q19 financial statement, KAI has a debt to HSBC Indonesia IDR 1.4 Trillion which is the import financing facility with 7% interest per year. The loan was used to buy 438 trains. KAI wants to replace the short term banking obligations with long term bonds, obviously Didiek.
Then, bond funds amounted to IDR 800 Billion for business expansion. That is among others to buy 36 new locomotives in 2020. Later the locomotive to strengthen the company’s passenger and coal transport. This locomotive is also for rejuvenation because as many as 762 of KAI trains are already over 30 years old. In addition, the new locomotive procurement is needed so that the red Plate company can use B20 biodiesel.