On Indo Stocks: Feb 2025 Market Crash
Crisis / Opportunity ?
Hi 👋 welcome to Recompound Blog - The Investment Mindshift. We help you better your mindset on investment and economics one article at a time. More: Advisory | Get to know us
P.S. I know the promised two articles on Indonesian stocks were about Indo government and manipulated stock prices, but I want to write about the Indo market from a different angle. Anywho if you missed the first part, here’s the link to the article where Toby talked about the weakening IDR. Enjoy!
The February 2025 Market Crash
As we step into March 2025, the Indonesian Composite Index (IHSG) has plunged 18% from August 2024 to February 2025.
However, if we exclude the artificially inflated conglomerate stocks (BREN, PANI, AMMN, TPIA), the broader Indonesian market has effectively returned to April 2020 levels—the depths of the COVID-19 market crash:
KOMPAS100: -32%
LQ45: -35%
In other words, Indonesian stocks are trading at prices last seen right after the COVID-19 bottom.
This Isn’t Our First Rodeo — And History Is on Our Side
This market downturn mirrors March 2020, when stocks collapsed before surging 57% by 2022.
As the saying goes, history doesn’t repeat, but it rhymes.
Here’s what we’re seeing:
Widespread pessimism: Public backlash over Danantara, the Pertamina corruption scandal, mass layoffs, and viral hashtags like #IndonesiaGelap and #KaburAjaDulu reflect deep distrust.
Corporate buybacks: Major companies are buying back shares—typically a strong signal of undervaluation and insider confidence.
Regulatory shifts: The Indonesia Stock Exchange (IDX) has eased share buyback regulations, allowing companies to repurchase shares without requiring an AGM.
