JAKARTA (Reuters) – Shares of Indonesia’s biggest tech company PT GoTo Gojek Tokopedia Tbk fell on Wednesday by their maximum allowed amount of 6.45%, as analysts warned of a risk of further losses as investors grapple with valuations in the sector.
GoTo debuted on April 11 after raising $1.1 billion in an initial public offering, the world’s fifth-largest IPO this year, by selling only around 4% of its shares at 338 rupiah a piece.
Initially GoTo shares appeared to have weathered a broader drop in global technology shares, but in recent days selling has picked up with shares hitting a low of 290 rupiah per share on Wednesday.
“Investors… don’t know for sure the prospects and valuation of GoTo shares,” said Maximilianus Nico Demus, associate director of research and investment at securities firm Pilarmas Investindo Sekuritas.
He said investors also remained “traumatised” after shares in Indonesian e-commerce firm Bukalapak had dropped more than 50% to around 360 rupiah per share since being listed last August at 850 rupiah.
Hans Kwee, a director at investment firm Anugerah Mega Investama, said selling had also accelerated after the stock failed to sustain a rally after the IPO, peaking at 442 rupiah.
“The retail investors think there is an opportunity for an instant high returns at the start of the IPO. So they immediately take profit if the shares go up,” said Kwee.
The drop in GoTo shares also came despite the company purchasing a total 6.01 billion of its own shares since last week in a bid to stabilise the share price, according to a filing to the Indonesian Stock Exchange on Tuesday.
GoTo has a greenshoe option scheme in place under which broker PT CGS-CIMB Sekuritas Indonesia was appointed to buy up shares from the market should the price hit or drop below the IPO level.
GoTo did not immediately respond to a request for comment.
(Reporting by Stefanno Sulaiman; Editing by Ed Davies)
