Construction SOE issuers compete for new contracts of infrastructure projects worth Rp422 trillion
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 - Emiten BUMN karya berebut kontrak baru di proyek infrastruktur Rp422 triliun
13 November 2023
By: Muawwan Daelami
Jakarta - Four state-owned enterprise (SOE) construction issuers, namely PT PP Tbk (PTPP), PT Adhi Karya Tbk (ADHI), PT Wijaya Karya Tbk (WIKA), and PT Waskita Karya Tbk (WSKT), are targeting new contracts from the government’s infrastructure projects in fiscal year 2024 that reach Rp422.7 trillion in value. The contract realisation of national projects is expected to be a significant factor for the performance growth of the four construction SOEs.
“We are targeting to optimise the opportunity to increase ADHI’s new contracts in line with our current competence and capacity,” ADHI Corporate Secretary Farid Budiyanto said to Investor Daily in Jakarta last weekend.
Farid is also optimistic about the new contract target next year as the government is striving to enhance infrastructure development and distribution, which is planned to be realised by increasing the infrastructure budget in 2024.
Echoing Farid’s sentiments, WIKA Corporate Secretary Mahendra Vijaya said that the company plans to leverage the increase in the government’s infrastructure budget in 2024. The opportunity is in accordance with the company’s strategy to absorb new contracts that are funded by the APBN (state budget).
“So, it can improve cash flow management and serve as capital for the next several years,” Mahendra said to Investor Daily on Saturday (11/11/2023).
Waskita Karya Corporate Secretary SVP Ermy Puspa Yunita said that, during the company’s current restructuring and transformation period, Waskita would be more selective in acquiring new contracts by focusing only on new projects that incorporate a monthly payment scheme and require a down payment.
“By increasing the government’s budget allocation for infrastructure development in 2024, Waskita is committed to contributing more to infrastructure development in Indonesia,” Ermy said to Investor Daily.
Meanwhile, PT PP Corporate Secretary Bakhtiyar Efendi said that the increase in the infrastructure budget allocation from the 2024 APBN to Rp422.7 trillion from Rp392 trillion was expected to accelerate priority infrastructure projects and national strategic projects (PSNs).
“PTPP will continue to participate in tenders. Not only tenders from the government, but also tenders from SOEs and private companies that are prospective,” Efendi said to Investor Daily recently.
Next year, Efendi continued that the company aimed to achieve the same contract value as this year. In 2024, the company will focus on completing government projects that use the state budget and PSNs.
Previously, PTPP targeted the value of new contracts this year to reach Rp34 trillion. However, Efendi predicts that only around Rp31 trillion will be realised as several project tenders have been delayed.
BSI Tower groundbreaking
Recently, PTPP also carried out the groundbreaking of Bank Syariah Indonesia (BSI) Tower. The project is located near Monas and is adjacent to Menara Danareksa.
SOE Minister Erick Thohir mentioned that Menara Danareksa and BSI Tower would be new icons located near Monas. “Monas will be one of the city centres where Jakarta’s economy grows in the future. Hence, we will start by constructing two twin buildings, namely Menara Danareksa and BSI Tower, which will be financial centres,” Erick said.
PTPP President Director Novel Arsyad added that the project that has an investment value of Rp1.1 trillion would be constructed by implementing the build, operate, and transfer (BOD) scheme between PT Bank Indonesia Tbk and PT PP Tbk, so it is a real form of SOE synergy.
BSI Tower is designed according to the green building concept and holds a gold certification. BSI Tower will have 22 floors of offices, 1 ballroom, and 1 basement floor. It will also have a parking podium that consists of 9 floors. To improve the security and the comfort of visitors, the building will also be fitted with electric vehicle charging stations, lifts with a destination control system, and a 24-hour surveillance and security system with CCTVs in public areas. Parking areas for bicycles, cars, and motorcycles will also be available.
“We will make history with Bank Syariah Indonesia through the groundbreaking that signifies the beginning of our collaborative effort on the construction of BSI Tower. The project, which is expected to be completed in 18 months, will utilise the bored pile system that incorporates dry boring. Furthermore, the design will leverage the Building Information Modelling (BIM) technology,” Novel explained.
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