The Indonesia Stock Exchange (IDX) has started a watch list of companies with concerning performances to protect investors.

The watch list, based on a regulation that took effect on Friday, contained 17 companies on Monday, including PT Waskita Beton Precast, a subsidiary of state-owned construction company PT Waskita Karya. Textile companies PT Ban Brothers and PT Sri Rejeki Isman also found themselves on the list.

“We hope [the watch list] will improve transparency and openness for investors, especially with regard to fundamental and liquidity conditions of publicly listed companies,” IDX director of development Hasan Fawzi said in a virtual press conference on Monday.

The measure comes at a time when more and more domestic retail investors are flocking to the local bourse and when many companies are under pressure from the pandemic-induced economic downturn.

Read also: ‘Rise of domestic retail investors’ increases IDX net profits by 9.5%

The IDX has set out 11 criteria to determine whether a company is put on the watch list, but it will use only seven of them in the initial phase. A company is singled out, for example, if its latest financial statement comes with a disclaimer of opinion from the auditor, if it books no revenue change compared with the previous financial statement or if the company – or one of its subsidiaries – faces a debt postponement petition (PKPU) or insolvency lawsuit.

Sri Rejeki Isman, better known as Sritex and traded on the bourse under the ticker symbol SRIL, has been suspended from trading for months after it failed to make timely coupon payments for its medium-term note and because it faced a PKPU. Trading in the shares of 10 other companies that are on the watch list has also been suspended.

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