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Commodity boom fuels Indonesia’s IPO market
Last year’s soaring commodity prices and the government’s downstream development push have prompted massive investment into metal mineral industries, which is expected to give Indonesia Stock Exchange a record year for public listings.
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A ceremony for the initial listing of shares of PT Pertamina Geothermal Energy (PGEO) is held at the Indonesia Stock Exchange (IDX) on Feb. 24. (Pertamina Geothermal Energy/-)
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ast year’s soaring commodity prices and the government’s downstream development push have prompted massive investment into metal mineral industries, which is expected to give Indonesia Stock Exchange (IDX) a record year for public listings.
Capital market expert Teguh Hidayat said Indonesia had benefited from the post-COVID-19 reopening of the economy and from last year’s rising commodity prices, which was encouraging companies to seize the opportunity for initial public offerings.
This comes after the turbulent economy of the last three years had made investors wary of the risks associated with investing in emerging markets.
Now that IPOs were returning in Indonesia, companies involved in the energy and mining sectors were expected to lead the way, he said, referring to the effect of the listing of Pertamina Geothermal, state-owned oil and gas Pertamina’s geothermal arm, on the country’s IPO market.
“The entry of big mining companies into the capital market would have a trickle-down effect on the rest of Indonesia’s economy,” Teguh, who is also the director of Avere Investama, told The Jakarta Post on Wednesday.
Read also: Two nickel IPOs this month point to downstream industry potential
Indonesia is already the busiest IPO market in Southeast Asia with US$828.1 million in new share sales so far this year, up more than fourfold from the same time in 2022, Refinitiv data show.
