In most recent days we hear that two big television firms who just deal and did merger in Indonesia, there are Indosiar and SCTV. Eventhough both of this company never be listed in LQ 45 (most liquid stocks in Indonesian market) but the merger still going on. It seems that there are no dubious words between this process that actually they are try to gain more in size. It is due to the competition in Broadcast industry that getting higher and steeper.
In today review, I want to see hows the movement of Indosiar stock strength, the reason is to see if the merger is actually will benefit for them or not in fianncial market condition.
Figure 1.
The comparison of adjusted close price between index (IHSG) and the price of SCMA (SCTV) and IMDK (Indosiar).
Figure 2. The compounded continues return of Indosiar and SCTV, and also IHSG.
Figure 3 Rolling 24 months beta of Indosiar
Figure 4 Rolling 24 months of SCMA beta
Figure 5 Regression of IDKM and IHSG
Figure 6 Regression of SCMA and IHSG
From the graphics above, we can see some hidden information related to this merger.
First, when the date approach the merger announcement, the price of both stocks is rising, it seems that investor or any market player can catch the hidden news from this moment.
Second, the continuously return of the stock after 2012 rise stunningly, leaving the aggregate continuously return of whole stock, the biggest owner of the stock will gain huge profit if they release their stock on proper moment. It is due to the stock of both firms is not sold anymore when they announce the date of merger.
Third, the allegation that the two firms will merge can be seen at the second quarter of 2010, the stock started to be more sensitive toward market, the rise of beta which higher than the average of 5 years average beta indicate that the owner of both stocks started to use this momentum to bid their luck.
Fourth, the regression line show that however both of this stock is still categorized as high risk stock, therefore market should be aware and not put this stock as long term investment.
To sum up, the graphs above is supposed to show the psychological movement of stock player in facing the issue of firms merger. The rise of stock sensitivity toward market and also the rise price show that any signal which is issued from credible or incredible resource has affected the psychological of market.
Alkisah, di tengah samudra yang maha luas, tampaklah ombak besar sedang bergulung-gulung dengan suaranya yang menggelegar, tampak bersuka ria menikmati kedasyatan kekuatannya, seakan-akan menyatakan keberadaan dirinya yang besar dan gagah perkasa.
Sementara itu, jauh di belakang gelombang ombak besar, tampak sang ombak kecil bersusah payah mengikuti. Ia terlihat lemah, tertatih-tatih, tak berdaya, dan jauh tersisih di belakang. Akhirnya, ombak kecil hanya bisa menyerah dan mengekor ke mana pun ombak besar pergi. Tetapi, di benaknya selalu muncul pertanyaan, mengapa dirinya begitu lebih lemah dan tak berdaya?
Suatu kali, ombak kecil bermaksud mengadu kepada ombak besar. Sambil tertaih-tatih ombak kecil berteriak: “Hai ombak besar. Tunggu!”
Sayup-sayup suara ombak kecil didengar juga oleh ombak besar. Lalu sang ombak besar sedikit memperlambat gerakannya dan berputar-putar mendekati arah datangnya suara. “Ada apa sahabat?” Jawab ombak besar d.... 
