Adhi Karya explores Rp2.1 trillion investment in JORR Elevated
This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.
Investor Daily - Adhi Karya jajaki investasi Rp2,1 triliun di JORR Elevated
14 February 2023
By: Muawwan Daelami
Jakarta - PT Adhi Karya Tbk (ADHI) is exploring to invest Rp2.1 trillion in Cikunir-Ulujami segment of Jakarta Outer Ring Road (JORR) Elevated. That amount is 10% of the total investment in JORR Elevated that reaches Rp21.56 trillion.
Adhi Karya Corporate Secretary Farid Budiyanto said that the company was continuously studying the investment in JORR Elevated. However, in terms of business, toll roads in Greater Jakarta are promising as they have high traffic.
“So, our main consideration is business and its capability as our capital after the rights issue has increased to Rp8.9 trillion,” Farid said to Investor Daily last weekend.
Besides the plan to increase their toll road investment portfolio, Farid admitted that the company was currently focused on completing Yogyakarta-Solo and Yogyakarta-Bawen toll segments as the company’s responsibility to the government as the major shareholder that injected state equity participation (PMN).
In the future, he stated that both toll segments could be sold by the company. Adhi Karya is not planning to be the operator of the segments.
“The construction of Yogyakarta-Solo toll segment was initially set to be completed in the fourth quarter of 2023. Yogyakarta-Bawen [toll segment] does not look like it will be completed soon as the project is worked on by a consortium of several business entities, such as PT Jasa Marga Tbk, PT Brantas Abipraya, and PT Wijaya Karya Tbk, and others,” Farid revealed.
Besides JORR Elevated, he stated that the company was considering entering Bogor-Serpong toll road project that was planned to commence next year. Moreover, the state-owned construction issuer is also involved in the construction of South Sentul-West Karawang toll road project.
Farid affirmed that, as an investor in the project, the company would also participate in designing. So, the investment in the project will be efficient and the route is attractive to road users.
Farid added that the company had not planned to propose for another PMN this year. The company is still focused on optimising the use of the PMN that was previously disbursed.
“However, that does not eliminate the possibility that we may propose for a PMN if we need it. This will be discussed with the SOE Ministry and the Finance Ministry,” he added.
Besides the CIkunir-Ulujami segment of JORR Elevated, Farid mentioned that Bogor-Serpong toll segment was continuously studied by the company. He hopes that the construction of the segment can commence in 2024.
“Then, for South Sentul-West Karawang toll road, we have yet to discuss the construction intensely. However, as we are an investor, we will design it so that it is attractive to and comfortable for users,” he said.
Regarding the tender of South Sentul-West Karawang toll road, PT Pamapersada Nusantara entered through their subsidiary, PT Persada Utama Infra, by establishing a consortium that consists of Jasa Marga, Adhi Karya, and Hutama Karya Infrastruktur.
South Sentul-West Karawang toll road will be built with an investment of Rp15.37 trillion. The project has an internal rate of return (IRR) of 18.55% and a net present value (NPV) of Rp2.77 trillion.
2022 results
Meanwhile, based on the research report of Mandiri Sekuritas (Mansek), four construction SOEs, namely Waskita, PT Adhi Karya Tbk (ADHI), PT PP Tbk (PTPP), and PT Wijaya Karya Tbk (WIKA), logged new contracts worth Rp108 trillion, which increased by 29% compared to the previous year. That amount is 91% of the decreased target.
The four companies logged fantastic new contracts in December 2022 worth Rp16.8 trillion or 15% of the total realisation in 2022. Most of the projects are toll road projects.
Meanwhile, last year, only PP and Adhi Karya were successful in achieving their new contract target in 2022. Adhi Karya’s new contract value surged by 55%, while Wika logged the highest new contract value worth Rp33.4 trillion.
This year, the Public Works and Housing (PUPR) Ministry has won infrastructure projects worth Rp6.4 trillion. In the future, tenders from the PUPR Ministry will be dominated by toll road projects, which will include Bayung Lencir-Tempino worth Rp5.9 trillion and Patimban toll road worth Rp4 trillion. “We are still observing the tender value of IKN projects this month,” the broker wrote.
