The valuation has been discounted, check out the interesting LQ45 stocks to collect

ILLUSTRATION. A reporter from a television station reports on the movement of share prices on the Indonesia Stock Exchange (IDX), Jakarta, Friday (18/9/2020). The Composite Stock Price Index (IHSG) on Friday (18/9) afternoon closed up 20.82 points or 0.41 percent to 5,059.22 positions.

Reporter: Ika Puspitasari | Editor: I knew Laoli

KONTAN.CO.ID – JAKARTA. Composite Stock Price Index (IHSG) closed down 1.53% or down 75.19 points to the level of 4,842.76 on Thursday trading (24/9). Within a week, the JCI was corrected by 3.88%.

Wisnu Prambudi Wibowo, Head of Research Analyst at FAC Sekuritas, assessed that a number of stocks from the LQ45 index are attractive to be collected amidst the JCI correction.

Apart from the low price to earnings ratio (PER), according to Wisnu, there are several important things that need to be considered, for example related to the sustainability of the issuer’s business.

“Sometimes there is a low PER but historical growth is not attractive,” he said, Thursday (9/24).

Also Read: Four days closed in the red zone, JCI is forecast to be corrected again on Friday (25/9)

From the list of LQ45 shares, he championed the shares of PT Telekomunikasi Indonesia (Persero) Tbk (TLKM) because seen from the price to book value (PBV), it is the lowest in the last three years.

PBV is the ratio of the share price to the company’s book value. Usually, stocks that have a large PBV ratio will have a high or overvalued valuation. Meanwhile, stocks with PBV below 1 time have a low or undervalued valuation.

So, for now the PER TLKM is recorded at 12.31 times with a PBV of 2.82 times. Wisnu said that the current PBV is relatively small compared to the historical PBV of TLKM which is above 3 times to 4 times.

“Then seen from the PER, usually when the bullish condition of TLKM is traded with a PER above 17 times, the current price is relatively cheap,” said Wisnu.

Also Read: JCI was corrected by more than 1% today, what will happen to tomorrow?

He further explained that in terms of business prospects TLKM is still quite good, even though the performance in the first half of this year has not recorded any growth in performance.

According to Kontan’s records, TLKM recorded a consolidated income of Rp 66.9 trillion and a net profit of Rp 10.99 trillion during the first semester of this year. This achievement declined slightly compared to the same period last year with Rp 69.34 trillion in revenue and Rp 11.07 trillion in net profit.