The world’s best-performing IPO stock this year is a little-known Indonesian coal mining company backed by some of Southeast Asia’s wealthiest people.
PT Petrindo Jaya Creasi has soared more than 2,900% since listing in March following a $25 million offering. However, it still lacks analyst coverage, has high valuations, and relatively low trading volume. Counting Indonesian billionaire Prajogo Pangestos as its largest shareholder, the company’s market value has grown more than 25 times to $5.4 billion in just nine months.
Indonesia has been one of the world’s most active initial public offering markets this year, helped in part by a boom in demand for renewable energy stocks. Petrindo, in particular, is one of the Indonesian stocks that has experienced inexplicable rises and wild swings this year, making its backers rich and leading to scrutiny from regulators.
Companies that have raised up to $100 million and listed on Asian exchanges this year, including Petrindo, have returned an average of 43% since listing.
Arif Isanario, mining sector analyst at MNC Securitas, said the company has “demonstrated aggressive diversification efforts through gold and nickel mining, which the market could see as a growth driver.” Stated. He added that investors “capitalized on Prajogo Pangesthu’s upward momentum this year.”
Petrind’s gains led to multiple trading suspensions and valuations soared. The company’s stock trades at 114 times annualized earnings for the quarter ending June, compared to a price-to-earnings ratio of 16 times on Indonesia’s benchmark Jakarta Composite Index. Since its listing, daily trading volume has averaged about 32 million shares.
The rise in stock prices has been a windfall for Mr. Pangestu, Indonesia’s third-richest person, according to the Bloomberg Billionaires Index. He obtained his fortune from his controlling stake in PT Barito Pacific, a power generation and petrochemical company based in Jakarta. Barito Renewable Energy Tbk, a unit of the group, has also soared since its listing last month.
There is optimism that Petrind’s bull run will continue. Agreements announced by the company in recent months include buying a 34% stake in engineering company PT Petrosea, acquiring coal company Multi Tambangjayautama and diversifying into gold mining. Petrindo, which operates in Kalimantan and West Nusa Tenggara, reported sales of 1.4 trillion rupiah ($67 million) in the June quarter.
“Time will tell whether the stock is currently overvalued or attractively priced,” said Mohit Mirpuri, a fund manager at SGMC Capital, which does not own the stock.
Ishika Mookerjee and Fathiya Darul, Live Reporters and Strategists at Bloomberg Markets
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