Indonesia\u2019s stock market remains sluggish as mid-2026 approaches,\nwith the Composite Stock Price Index (IHSG) experiencing a deep\ncorrection and a sparse IPO trend this year. According to data from the\nIndonesia Stock Exchange (BEI), only one company has gone public so far\nthis year as of 22 May 2026 \u2014 PT BSA Logistics Indonesia Tbk (WBSA),\nraising Rp 0.30 trillion. Currently, 15 companies are in BEI\u2019s listing\npipeline, comprising four mid-sized asset firms and 11 large-scale asset\ncompanies. Despite this, BEI has repeatedly affirmed its target of 50\nIPOs for 2026.<\/p>\n
Parto Karwito, CEO of Infovesta Utama, explained that the decline in\nIPO trends in 2025 was due to MSCI evaluations, geopolitical conflicts,\nand macroeconomic conditions. Regulators (BEI and the Financial Services\nAuthority) have also tightened IPO requirements, though the rules\nthemselves have not been amended. \u201cThese conditions have left investors\nwith limited options, able to invest only in the already declining\nsecondary market,\u201d he told Kontan on Friday (29 May 2026).<\/p>\n
Rully Arya Wisnubroto, Head of Research and Chief Economist at PT\nMirae Asset Sekuritas Indonesia, noted that the subdued IPO activity in\n2026 reflects a more selective market regarding valuations, fundamental\nquality, and free float structure \u2014 indicating that demand for capital\nvia the stock market has not disappeared entirely. \u201cCompared to last\nyear, the main issue now is not the number of potential issuers but a\nmismatch between sellers\u2019 valuation expectations and investors\u2019 cautious\nappetite in the secondary market,\u201d he told Kontan on Friday.<\/p>\n
However, this is largely due to a combination of market conditions,\nchanging investor behaviour, and a significant reassessment of the\nquality of companies listed on the exchange in recent years. Causes\ninclude more selective investors, disappointing recent IPOs, suboptimal\nglobal and domestic market conditions, and declining private market\nvaluations. Previously, many startups and growing companies hoped IPOs\nwould serve as premium valuation liquidity events. However, public\ninvestors no longer want to pay high prices for mere \u2018narratives\u2019,\ncausing IPO valuations to drop significantly. \u201cAs a result, many\ncompanies are opting to delay listings rather than proceed with\nlow-valued IPOs,\u201d he told Kontan on Friday (29 May 2026).<\/p>\n
\u201cThis may be interesting in terms of story and public appeal, but it\nis not enough to automatically make it an attractive investment,\u201d Rully\nsaid.<\/p>\n
Edwin stated that if these two companies proceed with IPOs, they\ncould be highly attractive due to strong brand awareness, high consumer\nengagement, and easily understandable domestic narratives for retail\ninvestors. For RANS, an IPO would likely focus on media narratives,\nentertainment ecosystems, creator economies, lifestyle, and consumer\nplatforms. While corporate actions may generate buzz, the main\nchallenges for celebrity-driven media companies are sustainability,\nmonetisation, and reliance on public figures. Institutional investors\ntypically focus on recurring revenue, EBITDA quality, cash flow, and\nscalability. \u201cWhether it\u2019s attractive depends heavily on valuation. If\nit\u2019s overpriced just because of a big name, the IPO risk for RANS is\nhigh,\u201d he said. \u201cMoreover, Indonesia\u2019s domestic consumption remains\nstrong. If valued reasonably, Taman Safari has greater potential to\nattract long-term investors compared to hype-driven IPOs,\u201d he added.<\/p>\n
IPO Quality Declines<\/p>\n
Rully noted that in recent years, IPO shares have typically performed\nstrongly initially before weakening once the euphoria fades. According\nto Parto, IPO shares are better suited for short-term investments due to\ntheir low free float, which allows prices to rise in the initial days to\nattract more investors. For context, Infovesta calculations show that\nexcluding PT DCI Indonesia Tbk (DCII), the average annual return for all\nIPO shares over the past five years was 31.19%. DCII was excluded due to\nanomalous returns. However, in the long term, company shareholders aim\nto sell their stakes at high prices, leading to declining IPO share\nprices.<\/p>\n
The IPO system and processes are considered sound, but implementation\nand oversight remain lacking \u2014 such as transparency in allocation,\nnominee investors using borrowed names, and unrecorded crossing\ntransactions during IPOs. \u201cThis results in low free float, prompting\nMSCI to impose sanctions,\u201d he explained.<\/p>\n
Edwin observed that most recent IPOs are better suited for momentum\ntrading than long-term investment due to characteristics such as low\nfree float, thin liquidity, concentrated ownership, aggressive\nvaluations, and unstable profitability. \u201cAs a result, prices are easily\nmanipulated \u2014 or \u2018goreng\u2019 \u2014 and investors are increasingly\ndistinguishing between IPO trading and IPO investing,\u201d he added.<\/p>\n
IPOs that could positively impact the domestic stock market are those\nfrom \u2018lighthouse\u2019 companies. The market wants to see IPOs that enhance\nindex quality, boost liquidity, and attract foreign inflows. Therefore,\nBEI and OJK, along with securities firms, must intensify IPO outreach to\nregions and provide intensive guidance to facilitate corporate actions.\n\u201cThere is no need to chase the number 50 (new issuers in 2026). The\nexchange must thoroughly conduct due diligence, tighten audits, and\ncarry out surprise inspections,\u201d he stated. Rully advised BEI to focus\non ensuring new issuer quality rather than pursuing quantity this year.\nRealistically, achieving the 2026 IPO target will depend on market\nstability in the second semester and\u2026<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/ipo-dry-spell-and-sluggish-stock-market-what-lies-ahead-1780332902", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }