Indonesia's Krakatau Steel says Q1 sales up over 50 pct

JAKARTA, April 7 (Reuters) - Indonesia's biggest steel maker, PT Krakatau Steel, said on Wednesday that it sales volume rose 53 percent to 675,000 tonnes in the first three months of 2010 from a year ago on strong local demand for infrastructure projects.

The company expected to sell 3.1 million tonnes by the end of the year, up from 2.3 million tonnes in 2009, said Irvan Hakim, Krakatau's marketing director.

Krakatau Steel sold 90 percent of its steel products in the first quarter to local infrastructure projects, mostly purchased by construction and property firms on Java island.

Hakim said the remaining 10 percent of steel products were mostly sold to Australia, Japan, Europe and Southeast Asia.

The official declined to give a forecast for revenue in 2010, saying that it depended on the steel price at the second half.

Fazwar Bujang, Krakatau's president director, has said that his company is still ready to conduct an initial public offering sometimes in November this year in order to get new additional capital of about 3.5 trillion rupiah ($387.1 million) by selling as much as 30 percent of new shares in the market.

The company is also in talks with South Korea's POSCO (005490.KS) to form a joint-venture steel factory with the capacity of 5 million tonnes of steel in Cilegon, Banten worth $6 billion that expected to kick-off in August this year.

(Reporting by Janeman Latul; Editing by Ed Davies)