Stock index gains; Gresik advances

Stock index gains; Gresik advances

Bloomberg, Jakarta

Indonesia's stock index rose for the first day in three. PT Semen Gresik advanced to a four-month high on optimism that a new head at the country's biggest cement maker may help end a four- year dispute with Mexico's Cemex SA.

The Jakarta Composite Index added 7.92, or 0.7 percent, to 1127.82 at the 4 p.m. local time close. Gaining stocks led declining ones 67 to 37, while 232 stocks were unchanged.

Semen Gresik, 51 percent owned by the government, gained Rp 350, or 1.9 percent, to 19,150, the highest since Feb. 24. The company named Dwi Soetjipto, previously president director of Gresik's unit in West Sumatra, as the new president director to replace Satriyo.

Cement sales in Indonesia are rising as economic growth raises consumer spending and boosts the construction. The company is considering expansion plans as it and the government hope to resolve a dispute with Cemex over its 25.5 percent

Soetjipto was appointed to head PT Semen Padang in May 2003, replacing the previous management, who together with local authorities in 2001 blocked the central government's attempt to sell a controlling stake in the parent company to Cemex, the world's third-biggest cement maker.

"Soetjipto is the choice made by the central government," said Irvin Patmadiwiria, who helps manage US$157 million of Indonesian assets at PT Batavia Prosperindo Aset Manajemen in Jakarta. "We are sure he is a proponent of the government program" to settle the dispute with Cemex.

The following stocks rose or fell. Stock symbols are in parentheses after company names.

PT Aneka Tambang (ANTM IJ), an Indonesian gold and nickel miner, slid Rp 25, or 1 percent, to 2,400. Gold for immediate delivery fell 0.4 percent to $438.25 an ounce in London as of 8:42 a.m. The metal is down for a third day.

PT Bank Danamon (BDMN IJ), the nation's fifth-largest lender, advanced Rp 100, or 2 percent, to 5,150.

Moody's Investors Service today raised its financial strength rating to D-, the fifth-lowest rating, from E+. The rating company said the bank's "positive economic solvency and earnings recovery have positioned it at the current rating range." ` PT Ciputra Surya (CTRS IJ), an Indonesian property company that develops houses, hotels, and shopping centers in the East Java city of Surabaya, gained 20 rupiah, or 1.5 percent, to 1,380. The company will pay a 30 rupiah-a-share dividend this year. That's higher than 25 rupiah the company paid last year.

NC Securities has initiated coverage of Ciputra Surya, with a "buy" recommendation. The company is expected to report a 38 percent increase in marketing sales of Rp 1.3 trillion this year from projects in East Java, the brokerage said in a report yesterday.

PT H.M. Sampoerna (HMSP IJ), an Indonesian cigarette maker bought by Philip Morris International last month, climbed Rp 50, or 0.6 percent, to 8,250. Sampoerna, the nation's third- biggest cigarette maker, said yesterday it will raise prices gradually to maintain margins after a planned tax increase.

Sampoerna is the second company after PT Gudang Garam (GGRM IJ), the nation's biggest cigarette maker, to increase prices after the government said on June 8 retail cigarette prices will be raised by 15 percent from July 1 to boost revenue from taxes. Gudang Garam added Rp 100, or 0.8 percent, to 12,750.