World’s most volatile big stock is rocking Indonesia’s market
penny stock: a 1,200% surge punctuated by two crashes of more than 40% — all in the span of less than nine months. But PT Barito Renewables Energy is Indonesia’s biggest company by market capitalization — an $85 billion geothermal power producer controlled by one of the country’s richest tycoons.
Barito’s wild swings – the most extreme among companies worldwide valued at $50 billion or more based on 30-day volatility – have perplexed professional analysts, stoked fevered trading among retail investors and challenged regulators’ attempts to bring more order to an increasingly volatile market.
The episode is offering a fresh reminder to international money managers on the lack of transparency that sometimes comes with investing in Indonesia’s $735 billion stock market. Barito has said little that might explain why its shares have swung so much, while authorities have refrained from disclosing specifics behind trading curbs implemented late May that critics say have exacerbated the stock’s volatility.
The trading restrictions “intended for investor protection ironically undermined broader investor confidence,” said Mohit Mirpuri, a fund manager at Singapore-based SGMC Capital Pte. “In the near term, this situation will likely deter risk-averse investors, especially if perceived as indicative of broader market instability or regulatory challenges.”
The controversy dates back to last June when the stock exchange launched a new watchlist for volatile and troubled companies. The board was envisioned as a
