Falling Advertising Budget Takes Toll on Indonesian TV Stocks
- Media Nusantra Citra, Surya Citra fell more than 15% this year
- ‘Makes sense for companies to cut their advertising’: CIMB
In this photograph taken on June 15, 2014, customers at a restaurant watch the live broadcast of the one on one debate between Indonesian presidential candidates Prabowo Subianto (seen on television screen) with opponent Joko Widodo in Solo city, the hometown of Widodo located in central Java island. Campaigning for Indonesia's July presidential election officially kicked off on June 4, with favourite Joko Widodo facing a tough challenge from a Suharto-era former general with a chequered human rights record. AFP PHOTO / ROMEO GACAD (Photo credit should read ROMEO GACAD/AFP/Getty Images)
Photographer: Romeo Gacad/AFP via Getty ImagesIndonesian media stocks may remain in the doldrums as the central bank’s surprise rate cut this week is unlikely to boost consumer spending soon enough to persuade companies to spend more on advertising.
The nation’s two biggest media companies, PT Media Nusantara Citra and PT Surya Citra Media, saw their shares falling by at least 15 percent this year, erasing more than 11 trillion rupiah ($823 million) from their combined market capitalization, as concerns about weakening consumer spending mount, even as the Jakarta Composite Index holds near its record high.