Jakarta bourse plans two trading sections

Jakarta bourse plans two trading sections

JAKARTA (JP): The Jakarta Stock Exchange (JSX) plans to divide listed companies into two categories, each of which will have its own trading section, in an effort to stimulate trading activities.

Any company that has been listed on the exchange for at least 12 months can be classified in the first category if it meets certain criteria. They include having a paid-up capital of at least Rp 50 billion ($23.35 million) and a total equity of no less than Rp 60 billion.

Companies with a paid-up capital of between Rp 50 billion and Rp 100 billion will be grouped in the first category only if the number of minority shareholders, or the investing public, is 1,000 or more, according to the draft of the exchange's new regulation.

The stock holding of the investing public in any company from the first section should account for at least 25 percent of the paid-up capital of Rp 50 billion, 20 percent for above Rp 50 billion to Rp 100 billion and 18 percent for between Rp 100 billion and Rp 200 billion and 15 percent for above Rp 200 billion.

The draft of the regulation will be presented during the annual meeting of the exchange members next month or in March.

The ratio between earnings from operation to the equity in the latest financial report should be at least eight percent, while the dividends should be at least 10 percent above the average of the amount of the dividends in the second section.

The stocks should be liquid with an annual transaction volume of at least one percent of the total listed stocks, according to the planned regulation.

The Association of Public Companies, however, has opposed the proposed listing regulation, saying that it is too restrictive.

Kusyadi Kuyono, the general secretary of the association, said that the criteria for the promotion in the main board or the first section is too strict for existing companies.

"Only a score of companies will meet the criteria. It is not rational, especially if the rule is enforced on companies already listed on the exchange," Kusyadi said.

Kusyadi, also an executive of the publicly listed Mulia Industrindo, asked the exchange to reconsider its plan to introduce the first trading section.

"It will be wiser if the new listing rule is enforced only to new listings," he said.

Companies already listed on the exchange could be considered pioneers and deserving of privileges from the exchange's authority, he said.(hen)