Newly listed shares at JSX mixed<\/p>\n
JAKARTA (JP): Stock analysts said yesterday that the
\nperformances of several newly listed shares on the Jakarta Stock
\nExchange (JSX) are likely to be clouded by liquidity problems,
\ndue to the small size of their initial public offerings (IPO).<\/p>\n
In the last two weeks, the stocks of four companies were
\nlisted on the JSX, just when the market was in a downward trend.<\/p>\n
In such a situation, investors need more time to see whether
\nthe newly listed shares -- PT Lippo Karawaci, PT Citatah, PT
\nLondon Sumatra and PT Cahaya Kalbar -- are able to achieve
\nsuccess in the primary market.<\/p>\n
Lippo Karawaci offered 30.8 million shares to raise Rp 100
\nbillion in funds, while Citatah raised Rp 104 billion by selling
\n44 million shares.<\/p>\n
London Sumatra booked total IPO proceeds of Rp 180 billion by
\nselling 38.8 million shares and Cahaya Kalbar Rp 37 billion by
\nissuing 34 million shares.<\/p>\n
Analysts said that the shares of four other companies (which
\nwill list their shares later this month) -- PT Fiskaragung, PT
\nSurya Dumai, PT Kedawung Setia and PT Ramayana -- may also face a
\nsimilar problem because of their small sizes.<\/p>\n
Several stock analysts contacted by The Jakarta Post viewed
\nthat given the IPOs' small size, their performances in the
\nsecondary market will depend on their lines of business and
\nfundamentals, together with investor strategy.<\/p>\n
An analyst said that concerns on liquidity are likely to cloud
\nthe performances of the planned IPOs due to their small offering
\nsize.<\/p>\n
\"The underwriters of those offerings might have realized that
\nthere are a lot of plans on the rights issues of big companies.
\nSo they decided to advise on the flotation of a small size of
\nshares in order to avoid failures on the primary market,\" the
\nvice president of Jardine Flemming, Rizal Prasetio, told the
\nPost.<\/p>\n
\"Although the size is small, it doesn't necessarily mean that
\nthose IPOs will fail to perform. If the share prices dropped in
\nthe last few days, it doesn't mean that they have failed. It
\ndepends on investors' strategy whether they make short-term or
\nlong-term investments,\" Rizal said.<\/p>\n
\"I think the performance of the newly-listed companies is also
\nsubject to the overall market weakness, due to the recent
\npolitical issues related to the departure of President Soeharto
\nto Europe for a medical check-up,\" Lippo Securities' managing
\ndirector Kelvin Lee told the Post.<\/p>\n
Another analyst, who is also a president of a foreign-based
\nsecurities company, said that some IPOs are good in terms of
\nbusiness lines, but uninteresting in terms of the IPO size.<\/p>\n
Rizal denied any assumption that the IPO may have come at a
\nwrong time because the market was just in its downward trend.<\/p>\n
\"I think the timing of several offerings was correct, because
\nthose offerings were reported oversubscribed. But their success
\nin the secondary market was another story,\" he said.<\/p>\n
Cahaya Kalbar, listed yesterday, gained 6.8 percent at
\nyesterday's close of Rp 1,175.<\/p>\n
Lippo Karawaci, listed on June 28, closed yesterday at Rp
\n3,150, or below its IPO price of Rp 3,250.<\/p>\n
On the first listing day, Lippo Karawaci gained 7 percent with
\nits share prices closing at Rp 3,500.<\/p>\n
Citatah, which was priced at Rp 2,375 on the primary market
\nand made a 5.2 percent gain in its first listing day on July 3,
\ndeclined to its IPO price at yesterday's close at Rp 2,375.<\/p>\n
Meanwhile, London Sumatra, which was listed on July 5, managed
\nto go up to a high of Rp 5,025 at yesterday's close against its
\nIPO price of Rp 4,650.<\/p>\n
Like most companies, newly listed companies usually try to
\ngain investors' attention by projecting higher earnings in the
\nfirst few years after the IPO.<\/p>\n
Cahaya Kalbar is projected to book Rp 45.6 billion in sales
\nand Rp 12.5 billion in profits this year.<\/p>\n
\"In the first half of this year, we already booked 60 percent
\nof the sales target,\" Cahaya Kalbar's managing director, Hardy S.
\nsaid.<\/p>\n
\"We will continue to work hard to achieve the results that we
\npromised our shareholders. In this regard, I am pleased to report
\nthat sales for the first half of this year were already 43
\npercent of the year's target,\" Citatah's president, Taufik
\nJohanes, said. (alo)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/newly-listed-shares-at-jsx-mixed-1447893297",
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