Investors Expected to Buy SOE Shares Again
Monday, 22 January, 2007 | 16:45 WIB

TEMPO Interactive, Jakarta: Investors are expected to return to the stock exchange and buy shares of state-owned enterprises SOEs) after the upheaval over PT Perusahaan Gas Negara Tbk (PGN) has calmed down.

According to Edwin A. Sinaga, a capital market practitioner, the recovering composite share price index at the Jakarta Stock Exchange was much affected by the improvement in PGN shares’ performance.

Market players regained their confidence after Finance Minister Sri Mulyani and State SOE Minister Sugiharto instructed the investigation into the PGN share price decrease to be completed.

“It was this decrease that caused the drop in the value of the company's assets,” said Edwin.

The decrease in value of PGN shares was followed by other SOE shares.

However, last week, SOE shares (outside of the pharmaceutical sector) recovered.

The highest rises were experienced by Bukit Asam with 12.61 percent; Antam with 12.14 percent; Timah with 11.76 percent; PGN with 10.81 percent; and Bank Mandiri with 9.09 percent.

Edwin said that market players will still watch the completion of PGN case, including the promise of the company's management to finish the gas pipelining project in three months.

“Should they take longer than this, then investors will recalculate. They will no longer be enthusiastic about buying shares at unreasonable prices,' he said.

According to Edwin, not all SOEs’ financial performances have been bad, “Most of them still have good performances.”

BUMN shares that are still worth investing in, he said, included Bank Mandiri, Bank BNI, Antam, Timah and Semen Gresik.

“However, as for PGN shares, investors must be careful,” said Edwin.

Based on research data from Tempo's Center for Data and Analyzing, up until September 2006, of the 11 SOEs listed on the market (apart from Indofarma and Kimia Farma), the value of assets increased by 8.9 percent—from Rp611.7 trillion to Rp666.1 trillion.

MUCHTAR WIJAYA (PDAT)