Apr 20, 2011

Govt. allows Telkom to buyback shares

Minister of State Owned Enterprises Mustafa Abubakar also showed his support towards the proposed shares buyback by PT Telekomunikasi Indonesia Tbk (Telkom).
“I back this corporate action as it had been consulted to us before. This is a measure to boost Telkom’s stock price. Each of state control enterprises has its own way to foster its performance, for example stock split. In this case, Telkom employs buy back,” said Mustafa.
Telkom yesterday has launched a buyback program of 416.67 million of B series shares with total cost of not more than Rp3 trillion.
In an official statement, Telkom, parent company of Indonesia's biggest cellular operator Telkomsel, hopes the fourth buyback program will incrase earning per share and provide continuity of return on equity.
Assuming Telkom could realizes the buyback, at end of 2010, its earning per share would increase to Rp588.87 per share from Rp586.56 per share. Return on equity might improve to 27.71% from 25.97% as well.

Disclosure: No position at the stock mentioned above.

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