Bank Mandiri makes impressive stock market debut<\/p>\n
Evi Mariani and Rendi Witular, The Jakarta Post, Jakarta<\/p>\n
Shares of the giant state-owned Bank Mandiri made an impressive
\ndebut on Monday, surging by 25.9 percent, which some say may
\nreflect growing investor confidence in the economy.<\/p>\n
While most shares on the Jakarta Stock Exchange (JSX) suffered
\nlosses after a bomb exploded at the House of Representatives in
\nthe morning, foreign investors who failed to get enough of
\nMandiri shares from the initial public offering (IPO) earlier in
\nthe month rushed in, pushing the price up to Rp 850, or Rp 175
\nhigher than IPO price of Rp 675, dealers said.<\/p>\n
"There is still a huge potential for the Mandiri share price
\nto go up. I predict that within a one-year period, the shares can
\nreach Rp 1,175 or 1.4 times its book value," BNI Securities
\nbanking analyst Fendi Susiyanto told The Jakarta Post.<\/p>\n
Mandiri, the country's largest bank in terms of assets,
\noffered 20 percent of its stake in the country's largest IPO
\nsince the 1997 financial crisis and the largest bank share
\nissuance in Asia, outside Japan. The IPO was more than seven
\ntimes oversubscribed, with foreign institutional investors taking
\n69 percent of the 4 billion shares on offer -- of which 30
\npercent came from Asia, 37 percent from Europe, and 33 percent
\nfrom North America. The Rp 2.7 trillion (about US$329 million)
\nproceeds raised from the IPO will help finance the 2003 state
\nbudget deficit.<\/p>\n
Mandiri is now the six largest counter in the Jakarta stock
\nexchange in terms of market capitalization, which means that
\nMandiri can move the index up by 0.17 percent for every one point
\nclimb in its share price. Indeed, the strong gains on Monday
\nhelped the JSX index to close 2 percent higher at 534.96 despite
\nthe bomb blast.<\/p>\n
The IPO was launched at a time when confidence in the
\ncountry's economy has started to improve amid rising stability in
\nmacroeconomic indicators, and as foreign investors were
\naggressively seeking higher returns from local assets due to the
\nglobal weakening of the U.S. dollar.<\/p>\n
Although the stellar performance of the Mandiri shares may
\nindicate rising foreign investor confidence in the country's
\neconomy, the bomb blast on Monday could revive fears of political
\nuncertainty ahead of the 2004 general election and the war
\nagainst terrorism.<\/p>\n
But the government is hopeful that the successful Mandiri IPO
\ncould be repeated in the upcoming IPO of two other state-owned
\nfirms this year: Bank BRI and gas distribution firm PGN.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/bank-mandiri-makes-impressive-stock-market-debut-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}