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PT Timah Drop 12% as Earlier Surge Deemed Excessive (Update1)
By Leony Aurora
Feb. 26 (Bloomberg) -- Shares of PT Timah, Indonesia's most expensive stock
based on the ratio of its share price to forecast earnings, had the biggest
intra-day decline in eighteen months as recent gains were deemed excessive.
Shares of Timah, Indonesia's largest tin miner, fell as much as 1,350
rupiah, or 12 percent, to 9,500 rupiah on the Jakarta Stock Exchange. The
stock, which has more than doubled this year, closed at 9,650 rupiah at the
bourse today.
``Timah's price has gained too much relative to tin price outlook,'' said
Prayoga Triyono, head analyst at PT Henan Putihrai in Jakarta.
Timah shares had surged after the price of tin rose to the highest since
1989 on concern that the Indonesian government's drive to curb illegal
mining would cut supply. The stock traded at 71 times estimated earnings
next year, according to Bloomberg data, making it the bourse's most
expensive stock by that measure.
Tin futures on the London Metal Exchange, the world's largest such market,
fell 1.3 percent to close at $13,475 a metric ton on Feb. 23, after touching
a record $13,975 a metric ton a day earlier.
Refined tin output from Indonesia, the second-biggest producer after China,
may fall about 30 percent to about 90,000 tons this year due to the
illegal-mining curbs, said industry analysts ITRI and CRU on Feb. 19.
Only Timah, 65 percent owned by the government, has a license to sell the
metal overseas after the government ordered producers to register for
permission to export.
To contact the reporter on this story: Leony Aurora in Jakarta at
[EMAIL PROTECTED]
*Last Updated: February 26, 2007 06:30 EST*
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