REPUBLIKA.CO.ID, JAKARTA -- Composite Stock Price Index (CSPI) at Indonesia Stock Exchange (IDX) rose at the end of last week due to short-term foreign funds. Director of the Finance, Eko B Supriyanto considered that the index was still corrected this week. Many investors will take profits, so that CSPI can fall again.
"Investors will make a profit taking. IDX index that reached a level of 4,620.22 last week will record a new equilibrium," Supriyanto said on Monday as reported by Elba Damhuri.
With the 21 times of price earning ratio (PER), IDX index showed the shares had been too expensive and it would move to 19 times.
PER of 21.04 times in Indonesia is the highest in Asia Pacific region after Shenzhen Stock Exchange.
PER is a ratio of corporate profits compared to its share price. It reflected the current stock price by profit calculated on its annual average. Supriyanto said that it would be better to investors to rearrange its portofolio.
"Be careful with the profit takers who can correct the stock price, especially in large cap stocks and consumer stocks," Supriyanto said.
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