Value of PTBA?s 15% shares is about $23.5 million

The value of the 15 percent shares that will be sold by the state owned coal producer PT Tambang Batubara Bukit Asam (PTBA) during its initial public offering later this year is estimated to reach Rp 216.6 billion (about US$23.5 million) or Rp 687 per share, Bisnis Indonesia reported on Friday.

Based on the valuation made by a security company, the entire share of the coal producer is worth $157 million.

PTBA plans to sell about 15 percent of its shares or about 315 million shares later this year as part of the government?s privatization program. The shares which will have a nominal value of Rp 500 each will be sold both to local and foreign investors.

According to the analyst, the price earning ratio is about 6.1 times, a bit lower than the earning price ratio of similar companies in the region which reach an average of 6.5 times. The analyst said that with the current performance of its balance sheet, it will be still fair enough to sell the PTBA?s shares at Rp 687 each.

The coal mining company?s net cash totaled about Rp 600 billion in the period ended in June 30, this year. The company also reported no significant debts during the period.

The Tanjung Enim, South Sumatra-based coal mining company producer has the capacity to produce 20 million tons of coal a year. But due to the lack of transportation capacity, PTBA is only able to produce about a half of them.

Last year, the company produced about 10.2 million tons, about 60 percent of the production were sold to the Suralaya power plant in Merak, West Java. (*)