Consumer goods giant PT Unilever Indonesia is planning to split its stocks in order to make them more affordable to retail investors.
“We think that the current share price is too high; that’s why we feel that we need to split them,” said director Sancoyo Antarikso in a statement on Monday.
The company’s stock, listed in the Indonesia Stock Exchange (IDX) with ticker code UNVR, closed at Rp 47,000 (US$3.32) on Friday, among the highest in the bourse.
Uniliver has not yet decided the ratio of the stock split, which would be proposed at its extraordinary shareholders meeting to be held later this year. With the stock split, the number of Unilever shares increases while the nominal value of each share decreases, depending on the split ratio. This would make the stocks more affordable to retail investors.
Sancoyo also said that the stock split would hopefully lure more retail investors and increase the stock’s liquidity.