The Indonesia Stock Exchange (IDX) will give time until 31 January 2016 for the remaining 18 publicly-listed companies that have not yet complied with the new minimum free float requirement that aims to increase liquidity in the stock market. In January 2014, the IDX announced it designed a new rule that forces all listed companies on the IDX to have a minimum free float of 7.5 percent. Samsul Hidayat, Director of Corporate Listing at the IDX, said these 18 companies are currently studying whether to conduct a rights issue or a stock split in order to raise their free float.
The minimum free float requirement of 7.5 percent of companies' enlarged equity to be released to the public is stipulated by BEI No. Kep-00001/BEI/01-2014. Listed companies are also required to have at least 300 shareholders. Companies that are currently studying which option to take include Bank CIMB Niaga and Adira Dinamika Multi Finance.
The biggest name that conducted a rights issue in order to comply with the new regulation is HM Sampoerna, Indonesia's largest cigarette producer. This company - one of the largest in terms of market capitalization on the Indonesia Stock Exchange - offered 269.7 million new shares with a total value of IDR 20.7 trillion (approx. USD $1.5 billion) in October 2015.
Several other companies conducted a stock split to comply with new rules. These firms include Multi Bintang Indonesia (stock split with a 1:100 ratio), Goodyear Indonesia (1:10), and Lautan Luas (1:2).
So far this year, a total of 14 Indonesian companies have been listed on the IDX, far below the initial target of 32 new listings. Companies that are still planning to become a publicly-listed company on the IDX before the year-end are fast-moving consumer goods company Kino Indonesia, construction firm Indonesia Pondasi Raya (better known as Indopora), rice producer Buyung Poetra Sembada, and boiler manufacturer Ateliers Mecanique D'Indonesie (better known as Atmindo).