Corporate strategy: Agile manoeuvre of toll road issuers
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 lincah emiten jalan tol
11 October 2023
By: Annisa K. Saumi & Ana Noviani
Jakarta - Toll road issuers are devising a strategy to boost their performances for the rest of this year. Toll road tariff adjustments, new toll road project construction, asset recycling, and acquisition exploration will be the manoeuvres implemented by the issuers.
PT Nusantara Infrastructure Tbk (META) Director Ridwan Abdul Chalif Irawan said that the company was in the middle of completing and has recently completed several toll road projects. Two of the projects are the developments of BSD toll segment and Makassar New Port (MNP) toll road connection access.
“MNP toll road connection access is expected to be opened soon,” he said during the public exposure on Tuesday (10/10).
Besides that, META is currently focusing on Cikunir-Ulujami elevated toll road or Jakarta Outer Ring Road (JORR) Elevated that was initiated in 2018. The project that is worked on by META with PT Adhi Karya (Persero) Tbk (ADHI) and PT Acset Indonusa Tbk (ACST) has reached an important milestone of establishing a joint venture, which is PT Jakarta Metro Ekspressway (JME) that was established on 13 September 2023.
During the occasion, META Director Danni Hasan said that the status of Cikunir-Ulujami elevated toll road was still at the stage. According to him, JME is still examining several matters in relation with the commercial aspect that will be stated in the toll road concession agreement (PPJT).
Regarding capital expenditure, Danni said that the development of the BSD project and the MNP project was a follow-up to META’s capital expenditure last year.
“So, in an aggregated manner, we have allocated around Rp1.3 trillion-Rp1.4 trillion for both projects, which has been 100% realised,” he revealed.
Danni mentioned that, besides organic expansion, acquisition is one of the growth strategies considered by META. After acquiring 40% of the shares of Jakarta-Cikampek MBZ elevated toll road, META is open to potential of acquiring other toll roads.
“The most important thing is the potential of the company to positively contribute. The first thing we see is the threshold [of the share portion] as it has to reach 40% or above. If Waskita is in the list of toll roads, we will consider exploring it,” Danni explained.
He added that the MBZ acquisition significantly contributed to META’s performance in the first half of 2023.
“Regarding revenue, the trend is most likely still the same as we have also adjusted the tariff of one of the toll roads in September. It is still growing around 11%-12% this year,” he added.
Meanwhile, META through PT Makassar Metro Network (MMN) officially adjusted the tariffs at five toll gates on 29 September 2023 at 8:00 AM WITA (Central Indonesia Time).
On another development, the toll road state-owned enterprise (SOE) issuer PT Jasa Marga (Persero) Tbk (JSMR) is continuing asset recycling this year.
Equity financing
Jasa Marga Acting Corporate Communication and Community Development Group Head Dwimawan Heru Santoso revealed that the equity financing activity of PT Jasamarga Transjawa Tol (JTT) was still ongoing, and it has been prepared thoroughly.
He continued that the step was taken through a thorough discussion and finalisation process with potential strategic partners and stakeholders.
“As part of good corporate governance implementation, we cannot provide further information on the shortlisted bidders and consortiums that are interested to be involved, the timeline, and the transaction valuation estimate due to the binding non-disclosure agreement (NDA) between us and the related investors,” Dwimawan said to Bisnis on Monday (9/10).
Dwimawan added that Jasa Marga could ensure that JTT’s equity financing was an equity-based funding strategy that can be used as an alternative long-term infrastructure funding source in the future.
Meanwhile, PT Citra Marga Nusaphala Persada Tbk (CMNP) President Director Jusuf Hamka is optimistic about Cisumdawu toll road recovering soon. Moreover, at the end of 2023, Kertajati Airport will be fully operational.
The CMNP final benefit recipient explained that the company planned to construct rest areas at several locations along Cisumdawu toll road to boost the average daily traffic of the toll road.
“As of 28 October 2023, Kertajati Airport will be opened and the airport in Bandung will be closed. Hopefully, in time, industries will be built around the area,” he added.
Jusuf added that the total construction budget allocated by CMNP to construct Cisumdawu toll road increased to Rp11 trillion from the estimated Rp8 trillion.
“The required [investment] increased from Rp8 trillion to Rp11 trillion. Is it profitable or not? It will be bloody. However, we are devoted, so we do not care about profit or loss,” he explained to the media as quoted on Tuesday (10/10).
Jusuf Hamka added that his company was committed to supporting the development of Nusantara Capital City (IKN), which includes the construction of toll roads around the supporting areas of IKN.
He also does not deny that he will build other facilities and infrastructure to support IKN development on a land that he owns in Palaran, Samarinda, East Kalimantan Province.
“It is part of CMNP, I have a land there. In Palaran, around 76 [hectares]. My parents are native to East Kalimantan. So, if we want to build, we do not have to purchase the land,” he added.
