IDX Adds 'Price Impact Ratio' Criterion for High Shareholding Concentration Stocks

The Indonesia Stock Exchange (IDX) has added a Price Impact Ratio criterion in determining shares with a market capitalisation above Rp10 trillion that fall into the High Shareholding Concentration (HSC) category. IDX President Director Jeffrey Hendrik stated that the new criterion will be used to screen for indications of high shareholding concentration. The Price Impact Ratio calculates the change in a stock’s price against its velocity, which is derived from the average transaction volume relative to the number of shares in public hands (free float). Consequently, shares with low trading activity will produce a low velocity, and a low velocity combined with a large price change will result in a high Price Impact Ratio. The exchange will screen these shares for potential high shareholding concentration, while other supervisory trigger factors will remain in place. The Price Impact Ratio criterion for all shares with a market capitalisation above Rp10 trillion will be applied periodically every three months, following the evaluation cycle of the IDX’s main indices. With the new criterion, the total number of shares in the HSC category has increased from 14 to 51. The IDX will announce the list of 51 HSC shares shortly. This initiative is part of ongoing reforms to ensure orderly, fair, and efficient transactions on the Indonesia Stock Exchange.