Indonesia's Bakrie Group-backed EV firm VKTR to raise $75.56m in IPO

Indonesia's Bakrie Group-backed EV firm VKTR to raise $75.56m in IPO

Photo: VKTR's website

Indonesian supplier of commercial electric vehicles PT VKTR Teknologi Mobilitas Tbk plans to raise 1.13 trillion rupiah ($75.56 million) through an initial public offering (IPO) on the local bourse, according to its prospectus published on Thursday.

VKTR, which is backed by the Indonesian conglomerate Bakrie Group, will issue 8.75 billion new shares or 20% of the total shares in the IPO. The price for the offering will be in the range of 100 to 130 rupiah apiece. 

The company will also have an employee stock allocation (ESA) of about 87.5 million shares or 1% of the total shares and a management stock ownership programme (MSOP) for 1.31 billion shares or 2.91% of the total shares.

DealStreetAsia had earlier reported about VKTR’s potential plans to raise $45 million in its IPO on the Indonesian bourse.

The book-building period for the issue will be from May 26-31, while the public offering is scheduled for June 12-14. The listing date has been fixed for June 16, 2023.

PT Samuel Sekuritas Indonesia, PT Ciptadana Sekuritas Asia, and PT Trimegah Sekuritas Indonesia Tbk act as underwriters in the IPO. 

The company will use a major portion of the funding proceeds to meet capital expenditure, while the remaining will be utilised for its subsidiary PT Bakrie Autoparts and to pay off the debt.

Following the IPO, the ownership of PT Bakrie Brothers Tbk will reduce from 57% to 45.55% in the company. The ownership of PT Bakrie Metal Industries will fall to 22.05% from 27.56%, and PT Kuantum Akselerasi Indonesia will also slide to 12.4% from 15.5%.

In terms of financial performance, VKTR booked a profit of 75.85 billion rupiah in the year ended Dec 31, 2022, compared to 55.22 billion rupiah in the same period of 2021. The company’s revenue went up to 1 trillion rupiah in Jan-Dec 2022, from 679 billion rupiah in the same period of 2021.

Yuanta Sekuritas head of research Chandra Pasaribu said, going by recent listings of Harita Nickel and Merdeka Battery, the VKTR stands a good chance to absorb the big cheque size from the IPO. “But VKTR should also bear in mind that not all electric vehicles can have good performance unless they have high-quality products and well-known brands in the market,” he said.

Investment plan

VKTR is preparing prototype electric buses for testing ahead of a planned launch this year. The firm has deployed 70 electric buses and will add another 200 this year, which requires a working capital of around 900 billion rupiah, VKTR’s CEO Gilarsi Setijono told DealStreetAsia in an earlier interaction.

Besides providing EV buses for public transportation, the company also plans to launch electric trucks and commercial electric motorcycles in 2024.

VKTR is looking to build a plant to process nickel sulphate, the key material used in making EV batteries. The company will build the nickel sulphate processing plant in Palopo, South Sulawesi in partnership with the Bakrie Group and nickel miner Vale Indonesia. The plant requires an investment of around $4 billion and will be completed by the end of 2025.

In March 2022, VKTR partnered with the UK-based EV battery maker Britishvolt to set up a nickel sulphate facility in Indonesia. In the same month, it teamed up with Equipmake, a UK-based electric powertrain developer to support converting vehicles to EVs.

Listed companies in the electric vehicle segment include ALVA by energy company Indika Energy; Electrum by energy company TBS Energi Utama and GoTo; Volta by technology company NFC Indonesia and IT solution company M Cash Integrasi; Selis by electronic component company Gaya Abadi Sempurna; and Gesits by infrastructure company Wijaya Karya.

Edited by: Padma Priya

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