PLN BATAM INITIAL PUBLIC OFFERING VALUE CREATION FOR ELECTRICITY BUSINESS

• Main Author: Iusticia Putra, Ade
• Format: Theses
• Language: Indonesia
• Subjects: Manajemen umum
• Online Access: https://digilib.itb.ac.id/gdl/view/62155
• Institution: Institut Teknologi Bandung

The growth of electricity sales on Batam Islands over the last ten years has reached an average of 6.0% per year. This growth is estimated to continue because the government has declared Batam Island as an industrial and business area. To reach high growth in demand for electricity, it is necessary to add in a large enough electricity supply facility with a large enough investment. In addition, from the technology sector, Industry 4.0 will be a threat and opportunity for PLN Batam in running the electricity business in the future. Related to the issues, it is necessary to initiate a strategic business plan that can be implemented in facing business challenges and provide competitive advantage to PT PLN Batam in the long term. This study aims to see the added value of a company in taking strategic corporate policies by trading on the stock exchange through an IPO which can provide added value and increase shareholders wealth. The research starts from analyzing macroeconomic conditions, identification and analysis of the company's internal and external environment with the aim of determining the company's development strategy in accordance with the visions to be achieved. In determining the value or valuation of the company, various approaches are carried out including Relative/Multiple Valuation, Discounted Cash Flow. From the calculation of Discounted Cash Flow using the projected cash basis, the intrinsic value of PT PLN Batam is Rp. 2,954/share from the moderate scenario, using the pessimistic scenario the valuation is Rp. 1,961/share, while in the optimistic scenario, the valuation of PLN Batam is Rp. 4,954/share. Meanwhile, using Multiple Valuations with an industrial average PER of 15.2, the intrinsic value of PT PLN Batam is Rp. 6,353, while using the PBVR the industry average of the intrinsic value of PT PLN Batam is 4,308. If using the optimistic scenario valuation, DCF PLN Batam obtains funds of Rp. 1,357,697,088,267 with the release of 10% shares in the market according to OJK regulations. PLN Batam is currently on the development board. The IPO funds are planned to be used for capital expenditures in the hope that the company can grow and compete with the same industry. From the results of the study it can be concluded, PT PLN Batam is a company with Intensive Capital so it requires a lot of capital to invest, one of which can be through an IPO in addition to funding, IPO is also a means of increasing the superior value of PT PLN Batam in the long term.