Effect of holding on shares of PT Wijaya Karya
Monday, January 28, 2019, PT WIKA held an Extraordinary General Meeting of Shareholders (EGM) with the agenda decided to approve the change in the status of Persero to non-Persero. The change in status is the first step for strengthening the housing sector BUMN (PERUMNAS) which was initiated by the Ministry of BUMN as a minority share. “Synergy between SOEs in Housing Holding will add capabilities to meet those needs by presenting quality housing at affordable prices. On the other hand, property prices continue to rise so that it is very profitable for the company in the future, “said Tumiyana President Director of PT WIKA.
WIKA is one of the construction companies that has built a number of infrastructure ranging from toll roads, bridges, to MRT and light rail (LRT) lines. Business in the housing sector and the development of this region will have a major impact on the public and companies because the need for housing continues to increase in the future and the status of Indonesia as a developing country will encourage much development to make Indonesia a developed country.
The profit from the establishment of this infrastructure BUMN holding will bring a positive impact to improve its own performance and it is believed that it will increase the value of the company’s assets so that it will increase leverage when financing project expansion.
WIKA targets the acquisition of new contracts in 2019 to grow 32% to IDR 66.74 trillion compared to 2018 which amounted to IDR 50.65 trillion. The total order book acquisition will also be Rp 140 trillion in 2019. The revenue target installed by WIKA can be achieved as long as it does not experience a setback schedule. for WIKA’s net profit target, he also said that it would be reached at Rp 3.01 trillion if the company carried out load efficiency so that it could produce an NPM ratio in the range of 7% -8%.
At present, the WIKA stock has a forward PE ratio of 9.4 times (with -1 standard deviation of the historical average of 5 years). Valuations for WIKA shares are still discounted with the forward PE ratio below the average PE ratio below the average forward PE ratio of 16.9 times. Meanwhile, when compared to the infrastructure, utility, and transportation sector index, it also experiences an undervaluation with a forward PE ratio of 18.29 times.
Technically, WIKA shares had formed a Bullish Harami* pattern candlestick which indicates there will be a strengthening in the next trade. Meanwhile, the two stochastic indicators are slow and the middle strength index is in the overbought area. It is estimated that WIKA’s shares will test the 100% Fibonacci Retracement* as the closest resistance to the 1.957 level. The shares are expected to move in the range of 1.860 – 1.950 in trading
Refferences
https://market.bisnis.com/
https://investasi.kontan.co.id
https://www.candlesticker.com/
*Bullish Harami : This pattern consists of a black body and a small white body which are all within the range of the black body. If a sketch is drawn from a pattern, it looks like a pregnant woman. This is not a coincidence. “Harami” is an ancient Japanese word for “pregnant”. The black candlestick is “mother” and the small “baby” candlestick.
*Fibonacci Retracement : is a forex analysis tool that many traders rely on. Whether it’s a new or experienced trader, as the main analytical tool or just an addition, Fibonacci is almost always in the forex trading device.
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