PT Indo American Seafood (ISEA) launched its initial public offering (IPO) on the Indonesia Stock Exchange (IDX) on Tuesday, with its shares opening at Rp 294 per share, up 16.80 percent.
ISEA is the 29th company to list on the IDX this year. The non-cyclical consumer goods company has hired KB Valbury Sekuritas as underwriter and lead manager for its IPO.
After the opening, ISEA’s share price fluctuated and settled at Rp 290 per share. The fish processing company’s trading volume reached 38.35 million shares with a trading value of Rp 10.93 billion, giving the company a market capitalization of Rp 403.1 billion (US$ 25.8 million).
ISEA offered 290 million shares, representing 20.86 percent of its issued and paid-in capital, with a par value of Rp 50 per share and an offering price of Rp 250. The IPO is expected to raise approximately Rp 72.5 billion.
In addition, the company plans to issue 145 million Series I warrants, representing 13.18% of the total issued shares, with the maximum value upon exercise of the warrants expected to be Rp 32.48 billion.
Ibnu Siena Alfitra, president of Indo-American Seafood, stressed that Indonesia has abundant marine resources from both fishing and aquaculture, giving it great potential to expand its seafood trade globally.
“This is evident from Indonesia’s seafood exports reaching US$2.8 billion from January to June 2023, with shrimp being the main export item, mainly to the United States (70%) and Japan (19%),” Alfitra said.
ISEA chief financial officer Ibnu Suriya Ramadan said the Indonesian government aims to increase the country’s shrimp production to 2 million tonnes by 2024. To achieve this, the Ministry of Marine Affairs and Fisheries (KKP) is promoting an integrated shrimp farming model and revitalizing shrimp ponds.
ISEA ensures that its products meet Indonesian National Standards (SNI) and the requirements of export destinations in line with government goals and programs.
Benefiting from the strong dollar, 98.5% of ISEA’s revenue comes from exports and its operating costs are denominated in rupiah, underpinning the company’s financial performance.
“These favourable conditions have management optimistic that the company’s performance will be sustained in the future,” Ibnu Surya said.
The net proceeds from the IPO will be used entirely as working capital: 90 percent will be used for the purchase of direct raw materials (including shrimp) and auxiliary materials (master cartons, polybags, trays, flour, food additives, etc.) from private and corporate suppliers, the remaining 5 percent will be used for sales and marketing expenses, and 4.85 percent will be used for maintenance and utility expenses.
The remainder will go towards office needs, such as purchasing or replacing electronic devices and other necessary office supplies.
In addition, the proceeds from the Series I Warrants will be used as working capital for, among other things, the purchase of direct and auxiliary raw materials.
ISEA also plans to distribute cash dividends at least annually and expects to distribute up to 30% of its net income for the fiscal year ending Dec. 31, 2024 in 2025.
