STOCKS NEWS INDONESIA-Household retailers slump on franchise regulation

Wed Oct 31, 2012 2:45am EDT

Shares in Indonesian retailers dropped after the government announced a new trade franchise law on Tuesday.

The Ministry of Trade issued a regulation limiting the number of company-owned outlets to 150 and said the remaining expansion must be sub-franchised, according to a statement on the ministry's website. (www.kemendag.go.id)

7-Eleven convenient franchise holder PT Modern International dropped as much as 5.33 percent to 710 rupiah and branded retailer PT Mitra Adiperkasa shares were down 1.52 percent at 6,500 rupiah.

Minimarket operator Sumber Alfaria was unchanged (stayed) at 5,200 rupiah, while the broader Jakarta Composite Index was down 0.68 percent.

1312 (0612 GMT)

(Reporting by Andjarsari Paramaditha; Editing by Subhranshu Sahu)

**************************************************************** 13:21 STOCKS NEWS INDONESIA-UBS ups Bank Mandiri target price

UBS Investment Research raised its target price on Indonesia's biggest lender PT Bank Mandiri Tbk to 9,300 rupiah from 9,025, and increased its earnings estimates based on higher net interest margin.

The research house, however, maintained its 'neutral' rating, saying the bank will not be able to surprise the market with positive results for the next few quarter even though it posted better-than-expected third-quarter results on Monday.

"Its loan-to-deposit ratio (including bonds) is already 103 percent. The simple loan-to-deposit ratio is also at 85 percent. It has not been able to sell its 78 trillion rupiah government bond portfolio to help finance loan growth," UBS said.

Bank Mandiri shares were down 0.6 percent at 8,350 rupiah, the broader index was down 0.68 percent.

1243 (0543 GMT) (Reporting by Andjarsari Paramaditha, Editing by Anand Basu)

*************************************************************** 12:37 STOCKS NEWS INDONESIA-UBS raises Unilever Indonesia target price

UBS Investment Research raised its target price on PT Unilever Indonesia Tbk to 19,100 rupiah from 13,500 rupiah per share after the consumer goods producer reported better-than-expected earnings before interest and tax (EBIT).

However, the research house kept its 'sell' rating on the stock due to its expensive valuation, downside risk of earnings forecasts due to rising costs and higher competition, and the limited potential on stock price increases.

Unilever shares were down 0.38 percent at 26,050 rupiah. The broader index was down 0.68 percent.

1233 (0533 GMT) (Reporting by Andjarsari Paramaditha, Editing by Prateek Chatterjee)

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