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Garuda nosedives on return to IDX
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A Garuda Indonesia airplane is parked at Soekarno-Hatta International Airport in Tangerang, Banten, on May 14, 2022. (AFP/Chaideer Mahyuddin)
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hares of national flag carrier Garuda Indonesia have suffered a precipitous drop in the company’s first days back on the stock market, as it struggles to regain the trust of investors after a solvency crisis last year.
On Tuesday, the Indonesia Stock Exchange (IDX) lifted a trading suspension on Garuda’s shares that had been in place for one and a half years following the airline’s default on US$500 million worth of sukuk (sharia-compliant bonds) in 2021.
Garuda shares plummeted to Rp 175 (1.18 US cents) apiece on Thursday after suffering an almost 7 percent drop for two consecutive days, the steepest one-day drop allowed before the bourse freezes trading of a company for the day.
Analysts said the decline could linger for some time, as investors were expected to continue dumping shares of the airline.
“Many investors [feel] Garuda’s performance has yet to reach a positive zone,” said Nafan Aji Gusta of Mirae Asset Securities on Thursday.
Read also: Bumpy takeoff for aviation, tourism sectors this year
Nafan added that Garuda’s stock price was in a “markdown phase”, a sustained downward trend, and said it remained unclear when the phase would end.
