Jakarta. Shares of independent power producer Megapower Makmur soared during its market debut on the local bourse on Wednesday (05/07) amid investor confidence in the business prospects of newly listed companies.
Jakarta-based Megapower is engaged in the procurement of goods and services for power generation and started investing in the power-plant business back in 2012. The company was acquired by Malaysia's Bina Puri Holdings, a diversified group mainly focused on construction.
The company's shares, trading under the MPOW ticker symbol, closed 70 percent higher to Rp 320 per share during the trading debut, compared to a 0.69 percent decline in the broader index.
The power producer, established in 2007, sold 245 million new shares, equivalent to 30 percent of its total equity, at an offering price of Rp 200 apiece in an initial public offering last month.
The company raised Rp 49.02 billion ($3.66 million) in fresh funds.
"Half of the IPO's proceeds will be allocated to repay debt, while the remainder is set aside for working capital," Megapower Makmur president director Kang Jimmy told reporters on Wednesday.
Megapower, the 19th company to go public this year, will use the proceeds to repay debt to its Selangor-based parent listed on the Malaysian bourse.
The remainder of the proceeds will be used for maintenance and business expansion, such as the development of new power plants.
Jimmy said the company is currently bidding on several power plant projects, but he declined to elaborate.
Megapower currently operates nine power plants in the provinces of Bangka Belitung, Riau Island and South Sulawesi. One of the power plants is hydroelectric, while the rest are diesel-fueled.
The company sells its output to state-owned utility Perusahaan Listrik Negara (PLN).