Experienced Investor Lo Kheng Hong Was 'Patience' When He Was Stuck In BUMI Shares Owned By Conglomerate Aburizal Bakrie

Lo Kheng Hong. (Photo: Doc. IDX)

JAKARTA - A seasoned investor, Lo Kheng Hong, told of a time when he was involved in the shares of the mining company PT Bumi Resources Tbk (BUMI). There were two reasons why he was able to stay in BUMI's stock, which at that time plummeted.

Lo Kheng Hong said that he once held 1 billion BUMI shares, which at that time was equivalent to 2.7 percent of the outstanding shares of the company owned by the conglomerate Aburizal Bakrie. But unfortunately, BUMI's shares fell to a share price of IDR 50.

The man who is referred to as Indonesia's Warren Buffet admitted that he did not immediately release BUMI shares or cut loss when the price was Rp. 50. He waited until he managed to sell BUMI's shares at a price of Rp500 in 2017.

"I was able to survive because I knew the company I bought was too cheap. Then a miracle occurred in the stock price of Rp. 50 and it could be converted to Rp. 926 and the price of coal rose to 100 US dollars," said the man who is familiarly called Pak Lo in Hungry's YouTube upload. Stock, quoted Friday 3 September.

Pak Lo said, BUMI has coal reserves worth 3 million tons with the assumption that when the price of coal is at the level of 100 US dollars, BUMI has a wealth of 300 billion US dollars. At that time, the number of BUMI's shares outstanding was around 20 billion, if multiplied by Rp. 50, the value of the shares was in the range of 700 million US dollars.

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"Of course I can survive, when I have a company that has coal reserves of 300 billion US dollars while its valuation in the stock exchange is only 700 million US dollars," he said.

Furthermore, Lo Kheng Hong said, it was a miracle alias help from God when BUMI was almost bankrupt and was included in the Suspension of Debt Payment Obligations (PKPU). That, he said, was a time of struggle.

"It's a miracle because the stock price from Rp50 can be converted to Rp926 and the price of coal which was 50 US dollars can go up to 100 US dollars, the stock price then rises to Rp500 and I get out, my money back," he concluded.