Mansek Jasa Marga bonds oversubscribed (JSMR,Rp3,100,Buy,TP:Rp3,200)

Jasa Marga will issue a new bond which tranched into a 10 year bond,Rp1tn,with an interest of 9.35%.pa;and 3 years zero coupon bonds,under Jasa Marga I series JM-10,amounting to Rp500bn with an interest rate of 9.1%pa.Following book building period,the bonds experienced oversubscribed up to 4.5 times.The fund proceeds from bonds issuance will be used to:45%for debt repayment,27%for capex,25%for non-toll road business development,and the remaining 5%for working capital.

We estimates JSMR ’s FY10F revenue reached Rp4.3tn (+17.1%yoy)and net profit up to Rp1.3tn (+34.2%yoy);due to increasing tariff in September 2009.Currently,JSMR trades at PER11F of 14.0x.

Mansek BUMI :Preemptive issuance below the company plans (BUMI,Rp2,250,Buy,TP:Rp3,665)

„ Reuters reported BUMI has scaled back the size of non preemptive rights issue to $362mn,priced at Rp2,366 per share. BUMI will disclose the buyers two days before the listing on October 5 of the new shares.

„ The size implied a 7%(from planned 10%)non preemptive rights issue.Initial reaction would be that BUMI can not find enough buyers to subscribe the rights which is priced higher than yesterday market close of Rp2,250 per share.The confirmation, unfortunately, may not be known immediately.If BUMI can find other source of funds especially new debts or asset sale,low preemptive take up might be the step taken to reduce earnings dilution.At Rp2,250 BUMI is trading at 10.9x PER11F of Mandiri estimates and 9.3x PER11F of Blomberg consensus.

Mansek Bumi Resources :1H10 within our estimates (BUMI,Rp1,710,Buy,TP:Rp3,665)

Discussing BUMI is not about discussing its operational performance.Their operational performances are inline with our expectation with a positive bias toward 2H10.However debt is still worrying.BUMI recorded a US$89.9mn (vs 1H09 : US$17.3mn)contribution in equity net income of associated companies,less than additional burden taken from ballooning debt and rising interest payment from US$4,189.8mn debt.BUMI paid US$257.4mn in financial charges (vs 1H09 :US$47.9mn).Therefore main concern is the state of its financial burden.In 1H10,BUMI increase its asset sales to US$171.7mn (1Q10:US$93.7mn),balancing the interest payment.Bumi also suffered US$60mn in derivative book losses. The derivative losses according to the company is in relation with its options contract for its convertible bonds issuance.

Mansek Jasa Marga and Citra Marga eyeing operator role in Cilincing-Rorotan (JSMR,Rp2,650,Buy,TP:Rp3,200)(CMNP,Rp930,Neutral,TP:Rp1,100)

Cilincing-Rorotan toll road (3.4Km),or Tanjung Priok toll section E1,has been completed and currently will take an eligibility test conducted by Toll Road Authority (BPJT).If the toll past the test,BPJT will open a tender offer to be the operator on the toll road,so it can commercially operate by end of this year.Tanjung Priok toll road has total length 12Km with total investment needed amounting Rp4.2tn,and the development divided into 4 sections.Jasa Marga and Citra Marga has expressed they interest to participate in the tender.

We have a Buy recommendation on JSMR,trades at PER10F-11F of 13.5x and 11.9x,respectively.

We have a Neutral recommendation on CMNP,trades at PER10F-11F of 3.7x and 3.9x,respectively of 16.5x).

Mansek Jasa Marga:site visit to Semarang-Ungaran toll road (JSMR,Rp2,600,Buy, TP:Rp3,200)

We visited Semarang-Ungaran (11.3Km)part of Semarang-Solo (75.7Km),on 5
Aug10,some key points are:

Land clearing has reached 100%and construction reached 90%.The toll is expected can be tested operationally on this Lebaran holiday and can be operating commercially in 4Q2010,in line with JSMR schedule.

Average traffic volume minimum for a toll road must reach 20,000 vehicles per day to meet the eligibility standards.

The company still in due diligence to acquire 2 new toll roads located in greater Jakarta,and has connecting with existing toll roads.JSMR allocated capex FY10 around Rp2.3tn.

We have Buy recommendation on JSMR,currently it trades at PER10F-11F of 13.3x and 11.7x,respectively.

Mansek Sampoerna Agro:1H10 results inline with ours and consensus estimates (SGRO,Rp 2,475,BUY,TP:Rp3,150)

SGRO reported 1H10 net profit of Rp131bn (+37.8%yoy),represented 34.4%of our FY forecast and 32.9%of consensus estimates.Please note that 1H results in 2007 and 2009 accounted for 31-34%of FY results,thus led to this year ’s 1H result was basically in line with our expectation.

The company ’s sales grew by 33.2%yoy,higher than in 1Q10 of 46.8%qoq,while operating margin reached 25.8%,an improvement from 21.2%in 1Q10 (vs our target for FY10 of 24.7%)

At current price,SGRO is trading at 2011F PER of 10.1x.We maintain our buy recommendation on the counter.