Coal Mining Prospect in Indonesia

Author: adi cahyono

Author: adi cahyono

Indonesian Coal Mining Association (APBI) believed that the local coal production this year as a whole could reach 250 million tons. That number increases, where coal production in 2010 is expected to reach 270 million tons. On the other hand, countries exporting energy resources, now visible from taking a position in Indonesia. One was China, which will begin to look to coal mining companies in the country for cooperation. In addition to meet the needs of fuel for electricity, as well as to diversify its foreign exchange reserves. Let's say China Investment Corporation (CIC) which signed an investment agreement worth U.S. $ 1.9 billion or approximately USD 19 trillion in a format similar debt instruments to PT Bumi Resources (BUMI).As one of the largest investment institutions and the world's leading, CIC see business prospects are promising coal in Indonesia. EARTH management in addition to the IDX information stated the transaction was not material because the form of refinancing transactions (refinancing), so this investment is not considered a new loan.The remaining funds will be used for expansion of coal production is now Earth is 60 million tonnes to 100 million tons (2011-2012). Loan guarantees in the form of shares in the company EARTH coal (estimated KPC and Arutmin). Local companies did not want to miss. One of them is PT AKR Corporindo (AKRA) which is currently doing due diligence process of PT Anugrah Karya Raya, which moves in the mining sector. This action to support the expansion in the future. On May 5 last, lien agreements AKRA shares of PT Jakarta Tank Terminal (JTT) associated with underwriting transactions credit facility of U.S. $ 60 million. It also sparked interest in the positive performance shown some issuers of coal in the ground water. One of them shares of PT Indo Tambangraya Megah (ITMG), which in the first half yesterday, was also quite positive, with net profit rising 129%. Then the business margin increased from 19% to 32%, while average selling price (ASP) rose from U.S. $ 60 to U.S. $ 79 per ton. Vice President, Research & Analysis Valbury securities Nico Omer Jonckheere still recommends buying shares of some coal, related to the increase in leverage biggest coal prices. He also ITMG price target to reach USD 41,700. Investors can buy on weakness at the level of Rp 24,200, he explained. Other stocks are recommended Nico PT Adaro Energy (ADRO), following the company's plan to obtain a loan of U.S. $ 500 million from the syndication of local banks and 12 foreign and possible purchase of 3 million tons of coal ADRO by Indonesia Power to meet the needs of 3400 MW power plant in front. We recommend a buy with a target price of Rp 2675, he said. According to him, the company's performance posiitif enough, with a net profit of 1507% increase, with business margin increased from 21.4% to 38.2%. In addition, the company also plans to acquire coal mines owned by BHP Billiton and increase production to 80 million tons / year. Coal business will be more developed, new investors will enter the coal business. Buying and selling of coal in Indonesia will get better, with the supply of coal for local needs and to export coal to Overseas. We, also coalinvestors.com Finding New Investors on Business Coal, for it please contact us for details at http://www.coalinvestors.com About the Author:

Adi Cahyono is coal business entrepreneur in indonesia , focusing to make good relationship with international coal investors.

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