JAKARTA. PT Waskita Karya Tbk (WSKT) is optimistic to reach its business targets this year. As of the end of September 2016, the state-owned construction company has recorded a worth of Rp 59 trillion contracts. The amount is equivalent to 89.3% of the target this year with a total value of Rp 66 trillion.

"We are optimistic to exceed the target of contracts until the end of the year," said Director of Waskita M. Choliq to KONTAN, Friday (18/11).

WSKT is also confident that this year the company can reach the significant revenues target, which amounted to Rp 24 trillion. That figure jumped 71% compared to the last year’s revenues, which reached Rp 14 trillion.

WSKT net profit this year is projected to reach Rp 1.70 trillion, or soar 62% compared with last year's net profit of Rp 1.05 trillion.

This time until the next few years, WSKT will focus on toll road projects. To strengthen the expansion, the company, which was established in 1961, has allocated larger capital expenditure (capex) than this year's budget. Based on the KONTAN’s record, WKST has prepared Rp 10 trillion for the capital expenditure of this year.

Income will grow by 50%

However, the absorption of capital expenditure WSKT is relatively low. Corporate Secretary of WSKT Hadi Susilo explained that until now the company just absorbed an Rp 3 trillion capital expenditure.

"Recently, capex seems smaller, as we decided to shift the capital injection for several subsidiaries the loan. Capex will increase after the loans to the subsidiaries are of gradually converted to a capital injection," said Hadi to KONTAN.

In the next year, WSKT will increase their capital expenditure’s values from this year. However, Hadi is still not willing to reveal the number of capital expenditure to be allocated throughout 2017.

WKST, which was initially a Dutch company called Volker Maatschappij NV Aannemings will allocate the capital expenditure to complete the toll road projects and develop precast concrete business. “The capex sources derived from internal cash and loans,” Hadi said.

With a number of expansion agenda, WSKT projected the income rise in the next year will grow by 40%-50% compared with Rp 24 trillion of the income estimation for this year. In other words, the construction state owned enterprise (SOE) is potentially to reap Rp 33.6 trillion-Rp 36 trillion.

Therefore, Fahressi recommended buy for WSKT shares, with the price in 2017 will be at Rp 3,200 per a share. “The catalyst is the large order book, which will secure the growth of their performances," he told KONTAN, Friday (18/11).

On Friday (18/11), the price of WSKT shares closed up at 0.43% to Rp 2,320 per a share. (Muhammad Farid/Translator)

Editor: Yudho Winarto