Pertamina Gas Acquisition Planned, State Gas Company Shares Soar

The clearer formation of the state-owned enterprise (SOE) Holding in the energy sector has driven up the share price of Perusahaan Gas Negara (Persero) Tbk (PGAS) since the beginning of the year. This also brightens the state-owned company's plan to acquire PT Pertamina Gas, a subsidiary of PT Pertamina (Persero). This corporate action will significantly increase the sales of the PGAS issuer.

On January 23, 2018, PGAS's share price closed up Rp 220 (8.91%) to Rp 2,690 per share from the previous day's closing price. As a result, the SOE's share price has risen 53.71% this year from its year-end position. Compared to its lowest price in the last year, Rp 1,405 on October 10 of the previous year, the government-owned gas company's share price has surged 91.46%.

On Thursday, January 24, PGAS's share price traded down Rp 20 to Rp 2,670 per share from the previous day's close. Based on the 14-day Relative Strength Index (RSI) technical indicator, PGAS shares are quite expensive and prone to correction as they are above the 70 level, indicating an overbought area. The RSI for PGAS shares has reached 80 on a scale of 0-100.