Investors feeling blue in letdown from Astra deal

Investors feeling blue in letdown from Astra deal

JAKARTA (JP): Market disappointment over last week's Astra
share sale may send a negative signal to trading activities on
the Jakarta Stock Exchange (JSX) this week, according to
securities analysts.

The analysts said the Astra share price disappointment could
temporarily hurt investors' trading mood in that they might be
discouraged by the outcome of the Astra bidding, most especially
in regards to its share price.

"Astra shares were sold at a level that is lower than what the
market expected," said an equity sales broker at HSBC Securities
Indonesia.

Another analyst from a local securities firm said there would
be some investors who would cut their losses on Astra shares
early this week, and this would dampen overall market sentiment.

"Investors who bet Astra shares high last week will probably
cut their losses on Monday as a result of Astra's low share price
in the bidding result," he said.

"However, the negative impact of the Astra share sale would be
temporary," he added.

He stated that a lot of investors were betting high on the
price of Astra stake prior to the announcement of the share
bidding by the Indonesia Bank Restructuring Agency (IBRA).

At that time rumors were circulated in the market and the
media saying the price bids would be in the range of between Rp
3,500 and over Rp 4,000, he said.

Investors were eventually let down by the IBRA decision to
sell the 40 percent government shares in Astra at Rp 3,700 a
piece to the winner of the open bidding which was Cycle and
Carriage (C&C) Ltd of Singapore.

On the IBRA announcement day, Friday, Astra shares hit the
day's high of Rp 3,800 but than moved lower and finally closed
the day at 3,650, pending news that C&C won the bid at 3,700.

An equity analyst at PT Nomura Indonesia, Goei Siauw Hong,
agreed that Astra stake shares were underpriced, yet it was good
for the market in the long term as the completed transaction --
the first high profile deal by IBRA -- would in turn increase
investors confidence in the country.

"C&C should offer a 25 percent premium on top of the share
market value in return for the controlling value it gets from
acquiring more than a 20 percent stake in Astra," he said.

Still other analysts said the market would also be worsened
further by the negative impact on kretek cigarette shares of the
government's plan to impose a higher excise on them starting in
April, due to their high nicotine and tar content.

Shares in kretek (clove-blended) cigarette stocks have over a
Rp 30 trillion market capitalization on JSX.

The rupiah, according to currency dealers, would appreciate
against the U.S. dollar this week as hopes of the return of
foreign investors to Indonesia strengthen, following the Astra
share transaction.

The local currency closed the week at 7,450, a little weaker
compared to 7,435 at the previous week's close.

The JSX Composite Index fell 1.6 percent last week to close at
581.47 points, down from 590.85 the previous week. And the daily
average transaction value decreased to Rp 599.72 billion,
compared to Rp 612.09 billion the previous week.

But the daily average turnover slightly increased to 457.2
million shares, from 425.2 million shares the previous week.

Last week's top gainers were PT Concord Benefit Enterprises,
whose shares jumped 41.43 percent, PT Keramika Indonesia by 33.33
percent and PT Transindo Multi Prima by 31.62 percent.

The week's big losers were PT Mandiri Intifinance, whose
shares fell by 31.43 percent, PT Alakasa Industrindo (down by
27.78 percent) and PT Panasia Filament Inti (down by 25 percent).

There was a new company listed on JSX last week, PT Dharma
Samudera Fishing Industries.

Meanwhile, PT Budi Acid Jaya last week announced a
distribution of cash dividend amounting to Rp 30 for each share.
The payment would be effective by mid April.

The top brokerage firms by transaction value were PT Bhakti
Investama with Rp 260.59 billion in transactions, PT Trimegah
Securindo Lestari with Rp 236.97 billion and PT Danareksa
Sekuritas with Rp 234.04 billion. (udi)