Indonesia Tobacco targets to raise $4.38m in IPO, eyes exports to India

An electronic ticker board displays stock prices inside the Indonesia Stock Exchange (IDX) in Jakarta, Indonesia, on Thursday, Dec. 17, 2015. Photographer: Dimas Ardian/Bloomberg

Indonesia Tobacco is targeting to raise up to $4.38 million in its initial public offering in July as it seeks to expand into the Indian market by way of exports.

Headquartered in East Java, the company makes 22 products with its flagship cigarette hand-rolled product called Manna. The company has a strong presence in the eastern part of Indonesia such as Papua and Sulawesi.

The company will use the IPO proceeds to meet working capital needs such as procurement of raw material. It also plans to market the products across the country and also overseas.

“Indonesia Tobacco will partner with a company in India to help with the distribution of the products. The partnership hopefully will finalise after the IPO,” Indonesia Tobacco independent commissioner Samsul Hidayat told DEALSTREETASIA.

Currently, the company’s export contribution to the sales is only 2-3 per cent with Malaysia, and Singapore as its two international main market destinations. By making inroads into India, the company targets to increase its export contribution to 30 per cent, Indonesia Tobacco president director Djonny Saksono told DEALSTREETASIA.

“Such targets are not easy for us. We expect to achieve that in several years,” Djonny said.

Indonesia Tobacco will sell 274 million shares, equivalent to 29.13 per cent of its enlarged capital. The company plans to sell its shares in the price range of Rp 180 ($0.03 cents) to Rp 230 ($0.016) apiece.

The book building process will end on May 31, before the shares will be offered to investors on June 25-July 1. The company will list on the IDX on July 4.

The company appointed a brokerage firm Philip Sekuritas Indonesia as the underwriter.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.