Market & Fund Raisings
Markets in Asia were mixed in early trade on Thursday, following losses in U.S. stocks, as investors remained on edge ahead of the U.K. vote on whether to leave the European Union (EU), Cnbc.com reported. The composite index of the Indonesia Stock Exchange (IDX) gained 0.37% to close at 4897 Wednesday (June 22), almost reaching the 4,900 psychological point level as it peaked at 4899 yesterday. Foreign investors booked net buy of Rp341.8 billion, bringing year-to-date net buy to Rp7.25 trillion.
Infrastructure Update
There are 30 projects that have been selected as priority infrastructure projects in Indonesia for the period of 2016-2019. In total, all these projects together will need some Rp5,519 trillion worth of investment. The Indonesian Government (including state-owned enterprises and regional governments), however, can only come up with Rp1,400 trillion, or 26% of the required funds. The remainder needs to be covered by the private sector. Here are updates on some of the major infrastructure projects in Indonesia.
Toll Road Projects Update
President Joko ‘Jokowi’ Widodo has inspected progress of physical construction of Bogor-Ciawi-Sukabumi (Bocimi) toll road this morning. Section I (15 KM) of the 54-KM toll road project, which has been delayed for two decades, is on schedule for commercial operation next year.
In Gold They Trust
Gold price went down 0.22% to US$1,289.20 per troy ounce Tuesday, along with the gaining momentum for campaign on Britain to remain in the European Union. Gold price fell as investors’ appetite assets seen as higher risk is sharpening. This is also sparking a sharp rally in global stocks. In near term, gold price would fluctuate.
Investment Updates
The State’s delayed capital injection of Rp34.13 trillion into 23 state companies, of which almost one-third would go to state electricity provider PT Perusahaan Listrik Negara (PLN), might be the most interesting investment story to watch. Discussions, in the absence of state-owned enterprises minister Rini Soemarno, in the House of Representatives (DPR) have been started in the context of amendment of 2016 Budget.
Tempo vs Ahok: Financials?
War between Tempo media group and Jakarta governor Basuki Tjahaja Purnama (Ahok) and Ahok’s supporters grouped in Teman Ahok intensified with Tempo magazine’s cover story this week surrounding the so-called conspiracy theory, i.e. campaign funding from property developers granted the lucrative reclamation concession in North Jakarta to Teman Ahok through political campaign consulting firm Cyrus Network.
Q&A with Cita Mineral on Bauxite Mining, Alumina & Tax Facility
Cita Mineral Investindo (CITA) recorded sales revenue of Rp27.4 billion in the first quarter of 2016, very small compared to the Company’s revenues prior to implementation of mineral ores export ban in early 2014, but better than zero in the corresponding period of 2015. Commercial operation of the first smelter grade alumina (SGA) in Indonesia by Well Harvest Winning Alumina Refinery, where CITA is minority shareholder, marks resumption of bauxite mining operations.
Toll Road Projects Update
President Joko ‘Jokowi’ Widodo has on Friday (June 17) kicked off construction of Pemalang-Batang and Batang-Semarang toll roads, which have been delayed for a decade now. Land acquisition is still a big challenge, but confidence was high upon commercial operation of the first two sections of Pejagan-Pemalang toll road (20 KM) earlier on Thursday.
New Nickel Smelters to Watch
Nickel has just returned to above US$9000 per ton in London Metal Exchange (LME), leaving its bottom by around 22%. This price, however, is still too low to make any profit given recent rise of fuel costs. Operation of new nickel smelters, mostly nickel pig iron (NPI), in Indonesia might cap further rally in the commodity though.
Who’s Who in 35,000 MW Project: SSP & Bosowa
PT Sumber Segara Primadaya (SSP), a joint venture between PT Sumberenergi Sakti Prima and PT Pembangkit Jawa Bali—-subsidiary of PT Perusahaan Listrik Negara (PLN), has on Thursday (June 16) signed commercial operation date (COD) of 660 MW coal-fired power plant in Cilacap, Central Java province.