COMPANY VALUATION ANALYSIS ON TELECOMMUNICATION INFRASTRUCTURE COMPANY IN PREPARATION OF IPO (INITIAL PUBLIC OFFERING) (CASE OF PT XYZ)

• Main Author: Amanatunissa M, Gheyi
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/53524
• Institution: Institut Teknologi Bandung

PT XYZ (real name is hidden) is a subsidiary of a state-owned telecommunication company which has been engaged in the provision of telecommunications infrastructure since 2008. PT XYZ itself has managed more than 22,000 telecommunication towers spread across Indonesia. During the current period of analysis, when the Indonesian Stock Exchanges considered as one of favorable option to raising fund, PT XYZ is planning to do Initial Public Offering (IPO) in order to obtain additional fund from public investor. By doing IPO, PT XYZ obligated to share their information to the public. Hence, this research contains how the current valuation for PT XYZ is and how potential investor should react on the IPO initiative. The valuation to derive PT XYZ’s fair value is using Discounted Cash Flow (DCF) Free Cash Flow to Equity (FCFE) method, and relative valuations as the confirmation for the DCF. Based on the valuations, the net present value for PT XYZ is at Rp 66,851 billion. Confirming to the relative valuations, it will be priced in at 8.67x P/E. Compared to the sector’s P/E at 41.65x, this valuation is undemanding, hence, this valuation is very attractive for investors to pay attention to and to buy shares of PT XYZ once it’s issued.