MSCI investability warning hits Indonesian stock market, top tycoons lose $5 billion in a single day

Glonghui, January 29｜After MSCI fundamentally questioned the value of Indonesian listed companies, the wealth of several top Indonesian tycoons shrank by more than $11 billion in a single day on Wednesday. The biggest loser was Indonesian tycoon Prajogo Pangestu, whose energy and mining companies saw their stock prices plummet, causing his net worth to evaporate by about $5 billion in one day. According to the Bloomberg Billionaires Index, his current net worth is about $35 billion, having already dropped by nearly $11 billion so far this year. This sell-off was in response to a report from MSCI, which questioned Indonesia's shareholder reporting rules, stating that investors believe these rules have led to opaque ownership structures and could trigger improper transactions. MSCI said it would suspend some anticipated index adjustments and warned that if the issues are not resolved by May, there could be further consequences. "MSCI's freeze is a warning signal," said Tarek Houchani, head of prime brokerage trading at Maybank Securities Singapore. If Indonesian regulators can show progress, "the situation will quickly ease. Otherwise, the risk premium will persist."