Local firms have good prospects to sell shares

JAKARTA (JP): Charles Balfour, a senior vice president of the New York-based Nasdaq Stock Market, sees promising prospects for Indonesian stocks on the U.S. capital market.

Balfour said here yesterday that demand for Indonesian stocks is considerably high in line with the growing interest on the part of American investors to access to the country's economy.

"We are anticipating more Indonesian companies to come in to fulfill the growing demand," he said.

He said that Indonesian firms are unlikely to face difficulties in listing their shares on U.S. stock exchanges as long as they are able to abide by the full disclosure requirement set by the Securities and Exchange Commission (SEC), the U.S. administration's agency overseeing capital market activities.

Balfour said that other prerequisites, such as listing requirements, will not become a big problem as most stock exchanges in the United States have a special section for small capitalized companies.

He said the recent listing of PT Tripolyta Indonesia on the Nasdaq had won a positive response from the market, as reflected by the encouraging performance of its share prices.

Tripolyta, a major producer of polypropylene resins, petrochemical plastics used in the manufacture of a wide range of consumer products, is the first Indonesian company listed on a U.S. stock exchange.

The state-owned international telecommunications company PT Indosat, which is now in the process of a public offering, is expected to follow suit soon. The company plans to cross-list its shares on the Jakarta and the New York Stock Exchanges (NYSE).

"Nasdaq is expecting more Indonesian companies in the coming years," he said in an interview with The Jakarta Post and Kompas dailies.

Balfour, who is here on a business trip, was accompanied by Nasdaq's Business Development Director Patrick N.S. Sutch during the interview.

Asian firms

Balfour said that it is a matter of time before Asian companies, including those from Indonesia, tap the potential of the capital market in the United States.

Asian companies must have a great amount of funds to enable them to get involved in the region's rapid economic activities, especially those related to the infrastructure development in the region, Sutch said.

"They have to obtain a great amount of investment funds from a major capital market, such as that in the United States," he said.

Nasdaq, the fastest growing stock market in the U.S. and the world's first electronically equipped stock exchange, began operating in 1971.

Balfour said the Nasdaq is the largest stock exchange in the world in terms of the number of listed firms and the second largest in terms of dollar volume, after the NYSE and ahead of the London and Tokyo exchanges.

There are 316 non-U.S. based companies listed on the Nasdaq at present, including 25 from Asia and 11 from Australia.

The trading volume of the Nasdaq reached $638.8 billion as of May, as compared to $1.07 trillion in the NYSE, $448.2 billion in London and $390.4 billion in Tokyo.

The Nasdaq has two trading segments -- the Nasdaq National, which at present includes 3,400 companies, and the Nasdaq SmallCap Market, with more than 1,350 companies. (hen)