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IDX revises ruling on Full Call Auction, GOTO will be less likely to be affected
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People walk past a large screen showing the trading numbers on the Indonesia Stock Exchange (IDX) in Jakarta on March 9, 2020. (AFP/Adek Berry)
T
he Indonesia Stock Exchange (IDX) is set to revise its policy concerning its Full Periodic Call Auction (FCA) in response to strong reaction and complaints from a number of investors.
In an announcement addressed to the entire members of stock exchange and all IDX stakeholders across the country, IDX will make adjustments of a number of criteria for shares that will be included in the Special Monitoring Board (PPK) and ask comments and responses from the relevant parties.
IDX implemented the FCA policy Chapter I on March 25, which aimed to protect investors, but sparked pros and cons.
PT GoTo Gojek Tokopedia Tbk (GOTO) share price dropped to Rp 50 level for the first time in IDX trading on June 19, 2024 and continued to be stagnant until the trading on Thursday, on June 20. GOTO shares were closed at Rp 50 level, with daily transaction value of 185 billion, and 3.69 billion shares.
Market players reacted to the implementation of the policy, with some worried if the shares of the parent Gojek and GoTo Financial (GTF) would become the target of the policy of Special Monitoring Board (PPK) which would potentially lead GOTO shares to be put under the FCA.
Adjusted criteria
Currently, IDX sets criteria for the FCA, comprised of 11 points to be placed on the IDX’s Special Monitoring Board. Of the 11 points, four, namely criteria no 1, 6, 7 and 10, will be subject to adjustment.
Under the new regulation, the period of the average price period for shares put under the FCA will be shortened from the previous 6 months below Rp 51 as mentioned in the criteria 1, to only three months.
In addition, in the criteria 1, the new regulation also requires companies to be placed on FCA to have required low liquidity, with the daily transaction less than Rp 5 million and daily transaction volume of less than 10,000 shares.
The shares that do not meet the criteria will be removed from the FCA board.
The IDX also added the criteria regarding shares that can be removed from the FCA board, namely the company concerned has paid cash dividends, the decision of which was made at the company’s general shareholders meeting (RUPS), with the share price at below Rp 50. This does not apply to shares included in the Acceleration Board.
According to stock analyst Abdul Azis at Kiwoom Sekuritas, with the two additional conditions, GOTO stock will find it difficult to enter.
“Looking at it more in depth, it will be difficult for GOTO shares to be included in FCA. It won’t even meet the revised ruling concerning FCA that has become a discourse over the last several days, including the liquidity issue,” Abdul Azis said.
Under the previous ruling, especially criteria 6 on the requirement for entry, shares that did not meet the fixed requirements or free float could enter FCA based on the IDX Regulation No. l-A and I-V.
In the revised ruling, the number of free float shares should be 5 million at the minimum for stock listed on the Primary and Development Board and above 5 percent of the number of listed shares for the Primary, Development and Acceleration Board.
IDX also set additional criteria for shares that will exit from FCA. The listed company should include in the list of the Liquidity Provider and own Liquidity Provider for Shares
Currently, GOTO owns 354,557 shareholders per May 2024, above the requirement, with the number of outstanding shares reaching 1,20 trillion.
Under the previous ruling, especially in the criteria number 7, shares that entered FCA was mainly due to the low liquidity and the daily average transaction value of less than Rp 5 million and the transaction volume of less than 10,000 shares for the last six months.
Under the new regulation, the number of accumulated calculations of daily average liquidity and transaction period is shortened to only 3 months.
IDX also set additional criteria for shares that will be exited. Only shares that have been paid and decided at the RUPS and low liquidity or has owned Liquidity Provider for Shares.
Finally, the criteria 10 under the previous regulation mentioned that shares entering the FCA board are mainly due to the suspension for more than one day, caused by the trade activity. IDX has adjusted the regulation by removing the stipulation.
On top of that, IDX has also shortened the shares entry period from the previous 30 days to 7 days.
Aziz said that up to now, IDX has never suspended GOTO shares. “The requirement (suspension) also (GOTO) is not included, despite that investors should also see sentiments further which can serve as positive or negative indication for the movement of GOTO shares,” he said.
