for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up

Indonesia's Matahari raises 528 bln rph from bonds

JAKARTA, April 13 (Reuters) - Indonesian retailer PT Matahari Putra Prima Tbk MPPA.JK raised a bigger-than-targeted 528 billion rupiah ($46.68 million) from a bonds issuance to help finance business expansion, an underwriter said on Monday.

A growing number of Indonesian corporates, including home lender, PT Bank Tabungan Negara, and construction firm, PT Waskita Karya, plan bond issuances later this year amid expectations of more interest rate cuts.

The central bank has cut its key interest rate BIPG by a total of 2.0 percent this year, bringing the rate down to 7.5 percent and has indicated further cuts to spur growth in Southeast Asia's biggest economy.

Matahari, which appointed PT HSBC Securities Indonesia, PT Indo Premier Securities and PT Ciptadana Securities as underwriters, had planned to raise 500 billion rupiah from a conventional and Islamic-compliant bond issuance.

But it raised 226 billion rupiah from sukuk and 302 billion rupiah from conventional bonds, which will be listed on the bourse on April 15, Harimantoro, president director at HSBC Securities, told Reuters.

“The yields are about 16 percent and 17 percent for conventional bonds maturing in three and five years, respectively,” Harimantoro said.

The sukuk bonds, also divided into the same tranches, are priced to yield as much as the conventional bonds, Harimantoro said.

Islamic bonds do not pay interest, which is banned as usury under Islamic law, but structured as profit-sharing or rental agreements underpinned by physical assets.

Matahari, with a market capitalisation of about $237.5 billion, says it had stores in more than 50 cities across Indonesia by the end of last year. ($1 = 11,085 rupiah) (Reporting by Sonya Angraini; Editing by Ed Davies)

for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up