Capital Market Watch 2026: Navigating New Initial Public Offering (“IPO”) Dynamics and Issuer Compliances

The Indonesian Capital Market is undergoing a strategic transformation in 2026. The Financial Services Authority (“OJK”) and PT Bursa Efek Indonesia (“IDX”) are shifting their focus from listing volume to market quality and liquidity. This regulatory reset demands immediate attention from the public companies or issuers to adapt to the new compliance standards set under OJK’s and IDX’s strategic roadmap. Below are some of the insights into such a transformation.

New IPO Dynamics and Allocation Rules

The IPO process has been fundamentally changed by Circular Letter of OJK No. 25/SEOJK.04/2025 on Verification of Orders and Funds, Allocation of Allotment, and Settlement of Securities Order in Electronic Public Offering of Shares. This letter mandates a significant increase in the retail pooling portion, which has been raised from the previous cap of approximately 33% to a fixed 50%. This change aims to democratize access and ensure broader distribution of shares. Complementary to this, a strict concentration limit has been imposed; no single investor may receive an allocation exceeding 10% of the total pooled shares. 

Priority for Scale and Environmental, Social, and Governance (ESG) Report Standardization

The market is now prioritizing scale and regional compliance. In line with its 2026–2030 Capital Market Development Master Plan, the IDX targets listing at least six Lighthouse IPOs in 2026. Lighthouse IPO is defined as an issuer with a market capitalization exceeding IDR3 trillion and a free float of 15%. Furthermore, according to IDX’s Press Release No. 007/BEI.SPR/01-2025, ESG reporting is no longer discretionary. Issuers must align their report with the standardized ASEAN Exchanges Common ESG Metrics, ensuring transparency and comparability with regional peers to attract global capital.

The Liquidity Mandate: Raising the Free Float Bar

A major policy signal impacting all public companies is the push for greater share liquidity. While the minimum free float currently required is only 7.5% under IDX Regulation No. I-A, the OJK Head of Capital Market Supervision on 31 December 2025 announced plans to raise this requirement to 15%-20%. This strategic change forces existing issuers with tightly held shares to begin planning for mandatory secondary offerings or rights issues to meet the forthcoming liquidity threshold and avoid future sanctions.

Issuer Compliance Checklist for 2026

To ensure immediate readiness, issuers must prioritize the following actions:

• Rethink Distribution Strategy: Assume 50% of your IPO is allocated to the retail pool and ensure compliance with the 10% individual cap.

• Target  “Lighthouse” Status: If seeking a large IPO, ensure capital structuring meets the IDR3 trillion market cap and 15% free float criteria for priority.

• Standardize ESG Data: Conduct a gap analysis and integrate systems to report data accurately, adhering strictly to the ASEAN Exchanges Common ESG Metrics. 

• Model 15%-20% Free Float: If your free float is currently below 15%-20%, model the financial impact of achieving this target through dilution (e.g., secondary offering, rights issue) to anticipate the free float requirement planned change.

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For further information, please contact the author:

Ferry F. Rajagukguk (Partner of FKNK Law Firm) | rajagukguk@fknk.co.id 

Rian Gunadi (Associate) | rian@fknk.co.id