Shares Drop, Add 3 More Issuers Ready to Buyback

Jakarta, CNBC Indonesia – Three issuers on the Indonesia Stock Exchange (IDX) announced plans to buy back shares (buyback). This decision was taken as a result of a decline in share prices and the Jakarta Composite Index since the beginning of the year has reached 30%.

In an announcement on the information disclosure page, Wednesday (18/3/2020), the three issuers carrying out the buyback included, among others, a glass manufacturing company, PT Mulia Industrindo Tbk (MLIA), contractor issuer PT Nusa Raya Cipta Tbk (NRCA), and a studio company. film, PT MD Pictures Tbk (FILM).

This buyback policy is also in line with regulations from the Financial Services Authority (OJK) which allows issuers to buybacks without going through the General Meeting of Shareholders (GMS) process due to market considerations that fluctuate significantly.

Mulia Industrindo plans to buy back up to Rp 25 billion from the company’s internal cash. The number of shares to be purchased will not exceed 20% of the company’s paid-up capital. Meanwhile, the period for the buyback of MLIA shares will be from 18 March 2020 to 18 June 2020.

“The share buyback does not result in a decrease in revenue and does not have an impact on the company’s financing costs,” wrote MLIA management.

Referring to IDX data, MLIA shares since the beginning of this year have corrected 37.43% to Rp 438 per share.

Another issuer that is also carrying out the buyback, PT Nusa Raya Cipta Tbk (NRCA), plans to allocate funds of up to IDR 125 billion with a maximum number of shares purchased is 10% of the company’s issued and paid-up capital with a maximum buyback price of IDR 500 per share.

“By buying back shares, the percentage of ownership of the company’s shareholders will increase proportionally,” wrote the NRCA management.

Since the beginning of the year, NRCA’s share price has been observed to have fallen 34.90% to Rp 250 per share.

Meanwhile, MD Pictures also plans to conduct a buyback in the period March 18 2020 to June 17 2020. The allocation of funds prepared by FILM is IDR 40 billion with a maximum buyback price of IDR 210 per share.

“The implementation of the buyback of the company’s shares is not expected to have an impact on the company’s revenue, therefore there will be no changes to the company’s profit proforma,” management wrote.

Since the beginning of the year, the share price of the company affiliated with Manoj Punjabi has been observed to have fallen 10.06% to Rp 161 per share.

[Gambas:Video CNBC]

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