[Kabar-indonesia] Berlian Laju upbeat despite poor trading debut

[Joyo at aol.com]

The Business Times [Singapore]
Thursday, November 2, 2006

Berlian Laju upbeat despite poor trading debut

Dual-listed stock of Indon firm trading lower here than in
Jakarta

Donald Urquhart

THE first Indonesian company to dual list in Singapore is
optimistic that its listing here will raise its investor
profile and provide a basis for future liquidity despite a
lacklustre trading start and a surprise gap in price of the
stock between the two bourses.

Berlian Laju Tankers (BLT), Indonesia's largest liquid cargo
shipping company and one of the largest in the intra-Asian
chemical tanker segment, made its mainboard trading debut
here on Monday after an offer of 576 million secondary
shares. The vendor shares raised some $184 million.

Priced at 32 cents per share, nearly a 10 per cent discount
to the trading price in Jakarta during the offering period,
its first day of trading here saw the shares closed
unchanged on a volume of 62 million shares traded.

Yesterday, the stock closed at 29.5 cents, 7.8 per cent
below the issue price. More than 21 million shares changed
hands.

But more curious, however, was the discrepancy in prices of
the stock on the two bourses with the closing price in
Singapore nearly 7 per cent below that in Jakarta.

In an interview with BT, company executives admitted they
were surprised by the gap in trading prices between Jakarta
and Singapore. Company founder and president commissioner
Hadi Surya, who holds a 48.7 per cent stake in BLT - down
from 62.5 per cent prior to the share offering -
nevertheless expressed his confidence that the price will
normalise.

'These are the first shares to be listed in the two stock
exchanges and initially people are confused but I do believe
that it will become firmer and firmer, more stabilised and
prices on both exchanges will come closer,' he said.

'The shares can pretty much freely flow between the two
exchanges, so we ourselves are a bit puzzled,' said BLT's
finance director Kevin Wong.

'The price differential may be because investors are not
fully aware of the share transfer mechanism. It is designed
so that the two markets can be nearly as one so the shares
are very fungible,' he added.

Shares can simply be transferred by requesting a broker in
either Jakarta or Singapore to transfer them to the other
location once an account has been opened there, according to
Mr Wong.
'During our roadshows we also covered this issue with
investors because they wanted to make sure there was no
split trading because of the two exchanges,' Mr Wong said,
adding: 'We thought there would be convergence but that
convergence has not occurred yet.'

Mr Surya also noted that some misperceptions existed about
BLT's timing for the listing here, saying that many believe
that the shipping market peaked in 2004/2005 and was heading
into a downturn. While this is the case in container
shipping sector, the tanker market continues to flourish.

'Our company is quite a unique shipping company,' he said
pointing to its diversification across the liquid bulk
sector and across geographical markets.

The group, which has more than 50 vessels, derives 58 per
cent of its revenue from the chemical tanker segment while
the oil tanker business generated 37 per cent and the gas
tanker business 5 per cent.

Geographically BLT generates 25 per cent of its business
from Indonesia, 25 per cent from the rest of South-east
Asia, 20 per cent North Asia, 25 per cent India/Middle East
and the remainder from Europe and others.

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Joyo Indonesia News Service
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