Apr 19, 2011

Telkom unveils Rp3 trio shares buyback

Indonesia's largest telecommunication operator PT Telekomunikasi Indonesia Tbk (Telkom) launches a buyback program of 416.67 million of B series shares with total cost of not more than Rp3 trillion.
In an official statement published today, 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.
However, the buyback could triggered a lowered net income to Rp11.45 trillion from Rp11.54 trillion. Its total equity would shrink to Rp41.33 trillion from Rp44.41 trillion.
The program will be implemented during 18 months after the operator obtains approval from its shareholders during annual general meeting scheduled on May 19.
PT Bahana Securities has been mandated by Telkom to hold the shares buyback. Post the buyback, Telkom's treasy stocks will increase to 4.46% stake or 899 million shares from 2.43% or 491 million shares. 

Disclosure: No position at the stock mentioned above.

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