Today's Headlines - 7 Juli 2014

Citilink Targets 15% Market Share (ID) Citilink Indonesia targets to get 15% of airline passenger market at the end of 2014. In 5M14, Citilink passengers have reached 3.6mn passengers. Until the end of this year, the company believes it can carry 8.2mn passengers driven by the addition in frequencies and new routes in Eastern Indonesia. The company estimates revenues in 1H14 to reach US$200mn with year-end target US$500mn.  Government Plan to Increase Coal Royalty by This Year (BI) The government signaled to raise royalty rates for open pit coal miners to 7%, 9%, and 13.5%. The 7% rate will be charged for coal under 5,000 kcal/kg, the rate of 9% for coal from 5,100 to 6,000 kcal/kg, and the 13.5% rates for coal above 6,100 kcal/kg. Furthermore, the government also plans to set a benchmark price of coal (HPB) at US$80/ton.  Comment: The government’s plan to increase royalty rate for IUP holders to between 7% and 13.5% will impact the most on the earnings for PTBA since all company’s license is currently under IUP. ITMG will have minimal impact since its coal mining concession under IUP accounted for about 12% of total coal production as of 2013. No impact for ADRO and HRUM as their coal mining concessions, which are currently operated, are under CCoWs.(Stefanus)  Marketing sales BSD reach Rp2.75 T (ID) Marketing sales of BSDE property business unit up until June 2014 was estimated at Rp2.75 trillion or about 46% of this year target of Rp6 trillion. Previously, Sinar Mas Land Ltd., through its subsidiary, PT Ekacentra Usahamaju and PT Paraga Artamida, buy as many as 874.8 million new shares, equivalent to 5% of BSDE paid up capital worth Rp1.59 trillion through non-preemptive right issue scheme that will be used for business expansion.  PTBA Eyeing US$600mn Power Plant (BI) PT Tambang Batubara Bukit Asam Persero Tbk (PTBA) is eyeing the power plants potential in Myanmar and Vietnam worth a total of US$600mn. The capacity on each country is estimated at around 2x100MW. Currently, PTBA still in the process of feasibility study as well as looking for funding options either through loan or project financing.

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