Corporate strategy: META's manoeuvre after delisting
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.
Bisnis Indonesia - Strategi korporasi: Manuver META usai delisting
30 November 2023
By: Affian Asmaaysi & Dionisio Damara Tonce
Salim Group’s issuer, PT Nusantara Infrastructure Tbk (META), will focus on its toll road business that has contributed 65% to the company’s total revenue.
Nusantara Infrastructure has officially announced that they are planning to be delisting in 2024. META's decision comes after weighing various factors, including fundraising and dividends.
META President Director M. Ramdani Basri said that, in the future, the company would focus on developing toll road projects. Historically, META’s revenue has primarily relied on its toll road business.
“As we are an infrastructure company, one our backbones is toll roads. The portion is almost 65% of META’s income,” he said at META’s public exposure as quoted on Friday (24/11).
The positive trend of the toll road business is reflected on the performance of Mohamed Bin Zayed (MBZ) Elevated Toll Road that was acquired in October 2022. META is optimistic about their financial performance improving after delisting.
“Then, we also received an award for Cikunir-Ulujami Toll Road that has an investment value of Rp21 trillion. So, if the question is whether we are interest [in developing toll roads], we are obviously looking for more development opportunities,” he added.
META Director Danni Hasan added that there were still many business opportunities in the toll road sector. The company predicts that their financial performance will improve within the coming four years at most.
“We can imagine [not making any revenue] for the next 5 to 7 years. Then, we will enjoy the harvest from the remaining 30 years [of concession]. So, I think that toll roads are a long-term business. If they are thoroughly observed, they will provide an excellent return,” he added.
In terms of performance, META’s revenue has been increasing until the third quarter of 2023. However, simultaneously, the company also reported a net loss that is a complete reversal from their profit recorded last year.
Based on the company’s financial statements up to the end of September 2023, META achieved a total revenue and sales of Rp665.27 billion. The amount grew 10.48% from last year.
After deducting various costs, the company incurred a net loss attributable to the owner of the parent entity of Rp156.86 billion for the current year. This amount stands in stark contrast to the profit of Rp65.56 billion they achieved in the third quarter of 2022..
Moreover, META’s delisting plan will be carried out after the company has obtained an approval at the extraordinary general meeting (EGM) scheduled for 19 December 2023.
There are two major reasons why META decided to carry out the delisting plan. First, the company did not raise any funds from the capital market since their rights issues in 2010 and 2018.
Then, META’s financial performance also decreased in the third quarter of 2023. The company has not distributed dividends to shareholders since fiscal year 2018 as they are developing many projects.
JORR’s fate
One of META’s major projects is Cikunir-Ulujami Jakarta Outer Ring Road (JORR) Elevated. The toll road is owned by PT Jakarta Metro Expressway that is a consortium that consists of PT Marga Metro Nusantara (MMN) that is META’s subsidiary, PT Adhi Karya (Persero) Tbk or ADHI, and Acset Indonusa Tbk (ACST).
Dannis Hasan explained that preparations for the construction of Cikunir-Ulujami JORR Elevated were currently being prepared. The construction is planned to commence in 2024.
He mentioned there was a potential that a strategic investor would enter the project that has an investment value of Rp21.25 trillion. Unfortunately, he does not want to mention the potential investor.
“We are currently in a group of four. Regarding the development, if everything goes well, there will be an additional strategic ally,” Danni explained.
“Besides planning the ROW, we are also simultaneously [preparing the design]. So, we can determine the location and carry out the alignment. Hopefully, it can be carried out in the next year. We will construct the toll road in 2024,” he added.
Previously, the Public Works and Housing (PUPR) Ministry explained that the construction of Cikunir-Ulujami JORR Elevated would cost Rp14.08 trillion.
Toll Road Regulatory Agency (BPJT) Head Miftachul Munir explained that the total investment cost of the project that will be constructed by the private-SOE (state-owned enterprise) consortium reached Rp21.2 trillion.
“The value of the project is around Rp21.2 trillion. In the consortium, MMN’s portion is 85%, Adhi Karya’s is 10%, and Acset’s is 5%,” he stated.
Munir explained that the land procurement cost of the project reached Rp1.64 trillion. The land acquisition process will commence at the end of the year, and it will be carried out for 12 months. The construction of the project is predicted to commence in the third quarter of 2024, and it is set to be completed in the first quarter of 2027.
