Indosat books another success in local marts<\/p>\n
JAKARTA (JP): The state-owned international telecommunications
\ncompany Indosat recorded another triumph during the first day of
\nthe trading of its shares on the Jakarta and Surabaya stock
\nexchanges yesterday after booking a successful debut on the New
\nYork Stock Exchange (NYSE) the day before.<\/p>\n
As soon as the morning trading session opened yesterday,
\nsecurities brokers thronged to the board of orders for Indosat
\nshares and their price jumped by almost 30 percent to Rp 9,000
\n(US$4.12) each in less than five minutes from their primary
\nmarket price of Rp 7,000 ($3.20).<\/p>\n
The price of the Indosat shares, however, failed to sustain
\nits upsurge, fluctuating only between Rp 8,700 and Rp 8,500 in
\nthe afternoon session as local investors began to take profits.<\/p>\n
It closed at Rp 8,475 (US$3.80), slightly higher than the
\nclosing price on the NYSE.<\/p>\n
The increase propped up the JSX (Jakarta Stock Exchange)
\nComposite Index to 8.3 points higher at 518.97, as compared to
\n510.62 the previous day.<\/p>\n
Minister of Finance Mar'ie Muhammad and other high ranking
\nofficials witnessed the listing and the first day's trading of
\nIndosat shares on JSX.<\/p>\n
Indosat's entry on the two local stock exchanges made trading
\nactivities frantic, with almost all investors focusing their
\nattention on the newcomer.<\/p>\n
Market officials likened the trading rush to the euphoric
\nsituation sparked by the entry of Barito Pacific Timber last
\nyear.<\/p>\n
Demand<\/p>\n
Securities analysts, however, said the demand for Indosat
\nshares was less strong than that for Barito, a timber giant in
\nthe country.<\/p>\n
"Barito's share price gained around 30 percent during the
\nfirst day of its listing, far higher than that recorded by
\nIndosat," said an executive of a Japanese securities company.<\/p>\n
He, however, said that the price of Indosat shares will be
\nmore stable not only due to its dual listing on the NYSE and the
\ndomestic capital market but also its strong business
\nfundamentals.<\/p>\n
Indosat's business will continue to grow in line with the
\nexpansion of the Indonesian economy, said an executive of Daiwa
\nInstitute Research.<\/p>\n
"Investors mostly buy shares due to their prospects, not on
\ntheir low PER (price earning ratio)", he said when asked if the
\ncompany's high Price Earning Ratio (PER) would discourage buyers.<\/p>\n
Indosat received strong support from American investors during
\nthe first day of its listing on the NYSE Tuesday. The price of
\nIndosat's American Depository Shares (ADSs), each comprising 10
\nshare units, reached US$37.50 before ending the day at $37.18, 16
\npercent higher than the price base set during the primary
\noffering.<\/p>\n
Hasan Zein Machmud, the president of the JSX, expected that
\nIndosat's successful debut on both the NYSE and local exchanges
\nwould encourage other large state corporations to follow suit.<\/p>\n
The overseas listing of Indosat helps promote the Indonesian
\ncapital markets into the world's major financial centers.<\/p>\n
Indosat's floating is billed as the largest Asian issue listed
\non the NYSE, and the largest company traded on the local
\nexchanges.<\/p>\n
Indosat sold around 7.75 percent of its 1.03 billion common
\nstocks on the domestic market and another 27.25 percent in New
\nYork during the primary offering period early this month.<\/p>\n
Indosat's shares, with a face value of Rp 500, were sold on
\nthe domestic market at Rp 7,000 (US$3.20), as compared to its
\ninternational price of $32.05 per each 10 stocks or per ADS.
\n(hen)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/indosat-books-another-success-in-local-marts-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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