Buyung Poetra Sembada and Marga Abhinaya Abadi debuted on the Indonesia Stock Exchance (IDX) on Thursday (22/06), joining five others that also listed this week. (Reuters Photo/Beawiharta)

Multi-Finance Company First Indo American Leasing Looks to Raise $6.6m in June IPO


MAY 15, 2017

Jakarta. Indonesian multi-finance company First Indo American Leasing is planning to raise up to Rp 88 billion, or $6.6 million, in an initial public offering next month to beef up its working capital.

"We decided to go for an IPO this year to build up confidence from public and banking companies," First Indo American Leasing president director Sumartono Mardjuki told reporters on Monday (15/05).

He added that the company, more commonly known as First Indo Finance, needs additional exposure as it plans to issue bonds in the near future.

The lender plans to sell 766 million new shares  equivalent to about 35 percent of the company's enlarged capital  at initial price offerings of Rp 105-115 each.

First Indo Finance recently appointed UOB Kay Hian Securities, a brokerage arm of Singapore-based banking giant United Overseas Bank (UOB), as underwriter for the IPO.

The company's book building period is scheduled for May 12-18, while it plans to list its shares on the Indonesia Stock Exchange (IDX) on June 8.

First Indo Finance, which mainly offers financial services to customers in the used car market, will forward all of its proceeds to branch out to the housing and maritime sectors,  as well as to strengthen used car loans and Indonesian migrant workers' loans.

"We started financing [migrant workers' loans] in April this year, and have secured permits [to distribute the financing] from BNP2TKI [Indonesian Migrant Workers Protection and Placement Agency]," First Indo Finance director Erinawaty Iskandar said.

First Indo Finance will look to boost its lending to Rp 1 trillion this year, an 84.5 percent increase from last year's Rp 542 billion.

"We have achieved at least 20 percent of our lending target in the first quarter," Erinawaty said, adding that the company is confident to dole out additional loans during this year's fasting month, or Ramadan.

First Indo Finance was established in 1981, and currently operates out of 36 branches located across Java, Sumatra, Kalimantan and Sulawesi.