Investors Hunting for SOE Shares
Monday, 30 October, 2006 | 17:16 WIB

Tempo Interactive, Jakarta: Shares of State-Owned Enterprises (SOEs) will become the focus of attention of market players this week.

This is triggered by the government's plan to issue the blueprint of SOEs privatization as part of its policy package in the monetary sector, which will be released next month.

This step will be a signal of the beginning of the government selling off shares in various SOEs.

In addition, the government formed a privatization committee on 1 October of this year in order to make the plan run smoothly.

Investors have welcomed this by hunting for SOE shares that are listed in the stock exchange earlier such as those of PT Perusahaan Gas Negara Tbk and PT Bank Negara Indonesia Tbk.

In addition, the government has planned of releasing some of its shares to strategic investors or holding initial public offerings.

The plan includes selling off shares in PT Wijaya Karya, PT Krakatau Steel, PT Bank Tabungan Negara, PT Indonesia Power and PT Jasa Marga.

Earlier, investors had been speculating by buying up SOE shares at the Jakarta Stock Exchange as from the beginning of the third quarter of this year.

Trading between 30 June and 20 October this year recorded that the trading of SOE shares increased by 23.1 percent.

The highest single increase occurred in BNI shares which rose by 116.6 percent from Rp1,130 per share to Rp2,450 per share.

In addition, Bank Mandiri's shares increased by 55.5 percent, Aneka Tambang by 33 percent, Timah by 26.4 percent, Indosat with 25.1 percent, Semen Gresik by 22.7 percent, BRI by 18.9 percent and Telkom by 13.6 percent.

Edwin A Sinaga, a stock exchange practitioner, questioned the government's aim in privatizing SOEs.

“If on the one hand, the objective is to improve SOE performances to improve, then there are positive values to market,” he said.

On the other hand, if the government intends to cover the revenue target of the State Budget, then the result would not be that optimal.

However, Edwin said that SOE privatization will create euphoria among market players to once again speculate by hunting for the shares.

“Purchases will be aimed at SOE shares that are considered as cheap such as those of Bank Mandiri, BNI and Timah,” he said.

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