IDX Plans to Scrap Rp 50 Minimum Share Price
IDX Plans to Scrap Rp 50 Minimum Share Price
Jakarta. The Indonesia Stock Exchange (IDX) plans to remove the Rp 50 ($0.003) minimum share price for stocks traded on the regular and cash markets, giving low-priced stocks more room to move and potentially improving liquidity and price discovery.
IDX President Director Jeffrey Hendrik said Thursday the exchange was still gathering feedback from market participants and assessing trading-system readiness before finalizing the rules.
“To provide better access to liquidity and price discovery, we will remove the Rp 50 minimum price restriction,” Jeffrey said.
Under current rules, Rp 50 is the effective floor for share prices in the regular and cash markets. A stock trading at Rp 50 cannot fall to Rp 49 or below.
If approved, the minimum price would drop to Rp 1. This would allow so-called stocks trading at Rp 50 to move below that level and give market forces greater scope to determine their value.
A lower share price does not necessarily mean a company has become cheaper, however. Investors still need to consider market capitalization, earnings, and other valuation measures.
New Trading Limits
IDX also plans to revise its daily auto rejection limits, which automatically reject orders when prices move beyond prescribed ranges.
ARB is the maximum permitted daily decline, while ARA is the maximum permitted increase.
Potential Impact on Low-Priced Stocks
IDX said the changes could also improve liquidity for stocks currently listed on the Special Monitoring Board, where trading is conducted through a call-auction mechanism.
If eligible stocks can eventually return to the regular market and trade through continuous auctions, the exchange estimates their transaction frequency and value could increase by two to three times.
The exchange also plans to remove two criteria for inclusion on the Special Monitoring Board: stocks with an average price below Rp 51 and low liquidity over the previous three months, and issuers that no longer meet other monitoring criteria but whose share prices have not yet reached Rp 50.
IDX plans to conduct trials of the proposed changes with exchange members on Aug. 22 and Aug. 29.
The exchange is targeting Sept. 7, 2026, for implementation, subject to system readiness and feedback from market participants.
Tags: Keywords: