Shares of Indonesian mining firm PT Amman Mineral Internasional Tbk rose by almost 4% on its first day of trading on the Indonesia Stock Exchange (IDX) on Friday.
According to IDX data, shares of Amman Mineral opened at 1,718 rupiah apiece, up 1.35% from its IPO price of 1,695 rupiah apiece. The scrip’s highest intra-day price was 1,820 rupiah and the lowest was 1,705 rupiah.
It closed at 1,755 rupiah on Friday.
Amman Mineral’s stock movement on July 7
Source: IDX
Alexander Ramlie, CEO of Amman Mineral said that copper mining has good prospects, in line with higher global demand for copper. “The increase in demand is supported by the growth of the electric vehicle and renewable energy industry which can help Amman Mineral maintain its position as the biggest copper miner in the world,” Ramlie said in a statement on Friday.
Amman Mineral Internasional raised 10.73 trillion rupiah ($715.81 million) in the country’s biggest IPO this year in June. The Jakarta-based company sold 6.33 billion shares, representing an 8.8% stake, at a price of 1,695 rupiah each.
The IPO topped that of Harita Nickel, which raised almost 10 trillion rupiah, and Pertamina Geothermal, which raised 9 trillion rupiah.
There was huge retail investor interest in the Amman Mineral IPO, which was oversubscribed by 13.6 times. The number of retail investors who participated stood at 27,000. “The pooling size also increased from 2.5% to 7.5% of the total shares issued in the IPO,” said Oki Ramadhana, Mandiri Sekuritas CEO.
Amman Mineral is said to be cheaply valued at a price-to-earnings (PE) ratio of 6.7 times. “Because of the low valuation, investors were interested in the Amman Mineral IPO,” Nafan Aji Gusta, senior investment information at PT Mirae Sekuritas Indonesia told DealStreetAsia. “Amman Mineral also has smelter projects that are expected to boost its business, both in revenue and profit,” he said.
As a gold miner, Amman Mineral will also become a safe haven stock in the midst of a possible economic recession and global economic turmoil, added Gusta.
Salim Group-backed PT Sumber Gemilang Persada is the majority shareholder of Amman Mineral with a stake of 35.58%, after the IPO.
Amman Mineral recorded net revenue of $2.8 billion in 2022, up 118% compared with $1.3 billion in 2021. Its profits increased by 243% in 2022 to $1.1 billion, compared to $321 million in 2021.