Stock index rises to best monthly gain since July

Stock index rises to best monthly gain since July

Naila Firdausi, Bloomberg/Jakarta

Indonesian stocks rose, helping the key stock index to its biggest monthly advance since July. PT Perusahaan Gas Negara (PGN) closed at a record for a second day on expectations rising gas prices would boost earnings.

PT Bank Mandiri gained after Kim Eng Securities in Jakarta said it may revise up earnings estimates for the company after the lender said non-performing loans declined.

The Jakarta Composite Index added 14.36, or 1.3 percent, to 1096.64, the highest since Oct. 14, at the 4 p.m. local time close. About seven stocks rose for every three that fell. The measure climbed 2.9 percent this month.

PGN, Indonesia's biggest energy-related company by value, jumped Rp 750, or 12 percent, to Rp 7,150. The stock accounted for more than a third of the benchmark's advance.

PGN on Nov. 25 said it will sell 287 million standard cubic feet of gas a day for seven years to 193 companies. A day earlier, the company said it plans to raise gas prices for industrial users by 22 percent in the next two years. The stock rose 32 percent this month, the best performer among the exchange's 45 most-traded stocks.

"Fundamentally it's very good; the higher sales volume and prices will boost its earnings," said Mustafa Kamil, an analyst at Phillip Securities Indonesia in Jakarta. The brokerage was a net buyer of PGN shares on Wednesday. "Some people place the price" at as much as 7,500 rupiah a share.

Mandiri, Indonesia's biggest lender by assets, rose Rp 40, or 3.2 percent, to Rp 1,290. Net non-performing loans ratio was 14 percent at the end of September, lower than 16 percent in June, it said on Tuesday.

"With declining non-performing loans, I am revising up earning estimates for this year and next," said Ricardo Silaen, an analyst at Kim Eng, who rates the stock "buy." The brokerage was the third-biggest net buyer of Mandiri shares on Wednesday.

The lender's net income in the three months ended Sept. 30 fell 57 percent to Rp 610.3 billion (US$61 million). Mandiri's third-quarter profit was derived by deducting six-month profit from the nine-month results filed by the lender on Wednesday.

PT Aneka Tambang (Antam), an Indonesian gold and nickel miner, gained Rp 125, or 4.6 percent, to Rp 2,850, the highest since Oct. 5. Antam jumped 5.8 percent on Tuesday after gold for immediate delivery touched $502.70 an ounce, the highest since February 1983. The contract traded at $494 an ounce at 5:10 p.m. Sydney time.

PT Bumi Resources, Indonesia's biggest coal exporter, declined Rp 20, or 2.8 percent, to Rp 690.

Investors were selling the shares "on the outlook of lower coal prices next year," said Edwin Sinaga, senior equity sales manager at PT Kuo Capital Raharja in Jakarta.

PT Timah, the world's biggest integrated tin refiner, climbed Rp 60, or 3.6 percent, to Rp 1,720, the highest close since Oct. 14. Tin for delivery on the London Metal Exchange rose 0.4 percent to $6,125 a metric ton on Tuesday, its second day of gain.

The contract rose 2 percent in four days to Tuesday.