Sep 1, 2010

Indofood CBP to spend Rp1.9trio capex

PT Indofood CBP Sukses Makmur Tbk (ICBP), subsidiary of Indonesia's largest instant noodle maker, has set Rp1.9 trillion capital expenditure (capex) to underpin business expansion in the next few years.
Indofood CBP Director Weriary Setiawan said the capex will be used to expand instant noodle capacity from current level at 15.7 billion packs annually by 13%.
The company, she said, also plans to jack up milk production capacity which will be completed in 2014.
"Indofood CBP aims to boost capacity of food seasoning, snacks, nutrition, and specialty foods which will be completed in 2013," she said.
Referring to prospectus of Indofood CBP IPO, it plans to spend Rp851 billion capex in the second half of this year.
In relation to the expansion program, ICBP Group estimates that it will require higher capex in 2011 and 2012. The company will bankroll the capex spending with combination of internally generated cash flow and the IPO proceed.
Indofood CBP today announces Rp4,300-Rp5,500 IPO price range, allowing it to snap up Rp4.98 trillion-Rp6.38 trillion proceed. The price reflects 15-20x price to earning ratio of its annualized earning this year.
The company will use about 70%-80% of the proceed to pay its debt, mostly to share holder worth Rp4.11 trillion and the remaining is used for working capital.

Disclosure: No position at the stock mentioned above.

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