Bareksa.com - PT Intermedia Capital Tbk (the Company) is a business entity that focuses on providing informative and entertaining program through the television media. The Company was established in 2008 and owns a subsidiary company named PT Cakrawala Andalas Televisi (99.99%) or what the Indonesian people know as ANTV. ANTV is a Free-To-Air (FTA) TV station that was acquired in 2009. The Company is a part of the PT Visi Media Asia Tbk (VIVA) that also owns shares of tvOne and VIVA.co.id.

The Company will at the most offer the public 588.232.000 of shares or 15%. From the total shares being offered, it consists of 294.116.000 of new ordinary shares and 294.116.000 of ordinary shares from VIVA.

Since ANTV was acquired in 2009, the Company repositions ANTV’s target auditions and has been focusing on contents that relates to sports and lifestyle. Due to the major reshaping, ANTV’s audience shares increases by 30% in 2008 to 2012 (Nielsen, 2012).

The family channel it is, ANTV is 6.7% of all-time audience in 2013. By the end of 2013, ANTV broadcasts in 35 broadcasting zones where it covers 160 cities Indonesia wide. That stated, exposes ANTV to approximately 147 million people or 61% of Indonesia’s population. Currently, ANTV operates with 4 studios with the capability of producing 2-4 programs per day.

In the Prime Time hours (5 PM to 7 PM), ANTV holds 10.6% share of audience, positioning them as number 3 amongst its peers. Whereas in Access to Primetime hours (1 PM to 4 PM), ANTV is number 1 with a 16.6% share of audience compared to other TV channels. By December 2013, 67% of programs being broadcasted by ANTV are in-house; programs which are made by ANTV and are not bought from external sources.

Financial Overview

Total Asset of the Company per September 2013 was booked at Rp 1.01 tn. From that figure, total Equity is Rp 654.4 and total Liabilities is Rp 359.4. Over a three year period (2010 to 2012), total Asset grew 22% CAGR.

The Company’s debt level is showing a downward trend as Debt to Equity ratio decreases. In 2011, the Debt to Equity ratio was at 1.2x and as per September 2013, it has become 0.5x. This was mainly due to the increasing Equity that is pushed by hikes in Retained Earnings (Rp191.2 bn in FY11 vs. Rp323.7 bn in 9M13).

In 9M13, Revenue was up +36% YoY as it books Rp633 bn vs. Rp464 bn in 9M12. A similar trend is shown by Operating Profit as it went up to Rp173 bn in 9M13 from 121 bn in 9M12 (+43% YoY). On the other hand, Net Profit was down by –8% YoY amounting to Rp89 bn in 9M13, compared to Rp 96.8 bn in the same period in the previous year. This was due to the trimming effect of Rp32.2 bn Finance Loss that occurred by September 2013.

In 2011, the Company’s profitability increased due to a Rp75 bn contribution from Other Income. ROA/ROE surged up to 34.5%/27.7% in FY11 but then in went down to 8%/7% in FY12. Looking at the 9M13 profitability improves as ROA was booked at 13% and ROE at 9%.

Initial Public Offering

The Company will offer to the public a maximum of 588.232.000 of shares (15% of free float) with a price range of Rp1.380-1.980 per share. From the total shares being offered, it consists of 294.116.000 of new ordinary shares and 294.116.000 of ordinary shares divested from VIVA group. The targeted fund that will be generated from the IPO is approximately Rp811 bn to Rp1.16 tn. The funds will be utilized for:

1. Approximately 80% of the funds will be utilized as capital expenditure with the details as follow:
a. 30% of it will be used to purchased land situated in Jakarta Timur and Bekasi. This transaction is not limited to any party as it can be conducted with affiliated parties and/or with third parties.
b. 25% of it will be allocated for the construction of a studio area for in-house program production capabilities.
c. 15% of it will support the Multiplexing Broadcasting via Terestrial System enhancement which includes building transmitters and multiplexer for digital broadcasting.
d. 10% of it will be used for the procurement of analog transmission gadgetries and other supporting broadcasting needs. This will be conducted with a third party.

2. Approximately 10% will be used to pay back loans of the Company to VIVA.

3. Lastly, 10% will be used as working capital for the Company and it subsidiaries such as for operational expenditure.

The distribution of funds to subsidiaries will be provided by the Company in the form of an unsecured loan with a reasonable interest rate that takes effect at the time the loan is provided, with a loan term of 3 to 5 years.

At the price of Rp 1.380 - Rp 1.980, the Company’s market capitalization will approximately be between Rp 5.4tn to Rp 7.76 bn. Shares offered are in the range of 32x - 45x for its P/E.