Kuya Food Express – JAKARTA — The Indonesia Stock Exchange (IDX) has announced that hundreds of its listed companies have yet to meet the minimum 15% free float requirement for their shares. This ongoing situation is anticipated to significantly boost the supply of stocks in the capital market over the next few years.
According to the IDX’s monitoring as of March 31, 2026, a total of 667 issuers have successfully complied with the free float provisions. However, a notable 281 issuers still fall short of these requirements and have been granted a transition period to implement the necessary adjustments.
Herditya Wicaksana, Head of Research at MNC Sekuritas, elaborated that this free float adjustment is poised to increase the supply of shares in the market, particularly impacting large-capitalization stocks. This strategic shift is expected to reshape market dynamics.
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“Bridging the free float gap for large-cap stocks could significantly amplify stock supply between 2027 and 2029,” Herditya stated on Friday (May 8, 2026). This timeline underscores the immediate future impact on market liquidity.
He further elaborated that corporate actions such as rights issues and secondary placements stand out as structural options for issuers to meet these requirements. Conversely, the option to go private is likely to be considered only as a last resort for companies seeking to avoid dilution of their existing shareholdings.
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Previously, the IDX had stipulated that listed companies with a market capitalization of at least IDR 5 trillion and a free float below 12.5% as of March 31, 2026, are mandated to achieve a minimum free float of 12.5% by March 31, 2027, further increasing to 15% by March 31, 2028. This tiered approach aims for gradual compliance.
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Conversely, issuers with a market capitalization below IDR 5 trillion are afforded an extended period, until March 31, 2029, to fulfill the minimum 15% free float requirement. This extended deadline acknowledges the varied capacities of smaller entities.
A specific condition also applies to issuers whose current free float stands between 12.5% and below 15%; these companies are required to directly meet the full 15% free float provision by 2027. This ensures a prompt uplift for those already close to the threshold.
MNC Sekuritas has highlighted several prominent large-cap stocks that warrant close attention regarding their free float compliance. For instance, PT Barito Renewables Energy Tbk. (BREN) currently holds a free float of 12.3%, while PT Chandra Asri Pacific Tbk. (TPIA) stands at 10.6%, and PT Pantai Indah Kapuk Dua Tbk. (PANI) at 11%. Additionally, other notable companies include PT Global Mediacom Tbk. (DNET) with a free float of 6.2%, PT Bank Permata Tbk. (BNLI) at 10%, PT Bank Syariah Indonesia Tbk. (BRIS) at 9.3%, and PT HM Sampoerna Tbk. (HMSP) at 7.5%. These figures underscore the significant adjustments many major players must undertake.
Teuku Fahmi Ariandar, Head of the IDX’s Listed Company Regulations and Services Division, clarified that these stipulations are rooted in amendments to Exchange Regulations No. I-A and I-V, which govern the listing of shares and equity securities. He further stated, “Every listed company is required to maintain a free float of at least 50 million shares and a minimum of 15% of the total listed shares for both the Main and Development Boards.”
He additionally explained that for companies listed on the Acceleration Board, a specific minimum free float obligation is set at 7.5% of their total listed shares, reflecting different growth stages and investor profiles.
Meanwhile, Welly Salam, General Secretary of the Indonesian Issuers Association (AEI), commented that the phased implementation of the free float rule provides ample scope for issuers to make the necessary adjustments. He told Bisnis recently, “According to the AEI, the time allotted is sufficient and not overly restrictive, as increasing free float is inherently positive for the advancement of Indonesia’s capital market, benefiting both market capitalization and liquidity.”
Nevertheless, Salam acknowledged that several significant challenges still loom for issuers striving to meet these provisions, ranging from prevailing economic conditions to market volatility. He concluded, “The primary obstacles for issuers in boosting their free float include the current unfavorable economic climate, escalating geopolitical tensions, and high market volatility. These factors collectively lead many investors to adopt a ‘wait and see’ approach.”
Muhammad Wafi, Head of Research at KISI Sekuritas, identified a key challenge in implementing this new policy: tight domestic liquidity, which inherently limits market absorption. He noted that, particularly amidst a sluggish market, this policy carries the potential to exert short-term pressure on stock prices.
However, Wafi posited that the rule’s phased implementation, spanning from 2027 to 2029, is crucial in averting a liquidity crunch and enables gradual market absorption as macroeconomic conditions are expected to improve. He asserted, “This policy is both effective and streamlines the process for issuers. The staggered scheme actively prevents a sudden ‘dumping’ of shares into the regular market, providing ample time for issuers to execute corporate actions and identify strategic buyers.”
Consequently, in the short term, Wafi believes this policy could trigger price pressure due to an oversupply of new shares. Nevertheless, the extended deadlines provided by the IDX for issuers are considered an effective mitigation strategy against a more significant market downturn. In the long term, however, this initiative is anticipated to generate positive sentiment for the capital market. The increased free float is expected to bolster market liquidity and enhance the prospects for greater inflows of foreign funds into the country, fostering a more robust and dynamic investment environment.
Disclaimer: This news article is not intended as an invitation to buy or sell shares. Investment decisions rest solely with the reader. Bisnis.com is not responsible for any losses or gains arising from the reader’s investment decisions.
Summary
The Indonesia Stock Exchange (IDX) currently requires hundreds of listed companies to meet a minimum 15% free float threshold, with 281 issuers yet to comply. To facilitate this, the IDX has implemented a phased timeline extending until 2029, allowing companies to use corporate actions like rights issues or secondary placements to adjust their share distribution. This initiative is designed to gradually increase market liquidity and encourage foreign investment without overwhelming the market.
While the regulation is expected to foster long-term growth and market robustness, analysts warn of potential short-term price pressure due to an oversupply of shares. Experts highlight that concerns over domestic liquidity and current economic volatility remain significant challenges for issuers during this transition. However, the staggered compliance schedule is viewed as an effective strategy to mitigate risks and allow for better market absorption of the new stock supplies.