MSCI to drop ride-hailing firm GoTo from Indonesia index on liquidity concerns

Indonesian ride-hailing giant GoTo Gojek Tokopedia will be removed from MSCI's Indonesia ​index at the end of this month, the ‌index provider said on Wednesday, dealing another setback to the country's equity markets.

GoTo, once valued at about $29 billion and among Indonesia's most valuable ​companies, has seen its market value fall to $3.2 billion, ​with its shares stuck at 50 rupiah, or less ⁠than a U.S. cent, since mid-May.

On the exchange's main trading ​boards, 50 rupiah is the minimum trading price.

MSCI froze changes ​to GoTo in its indexes in late May, opens new tab over concerns that the company's low liquidity could make it difficult for index-tracking investors to trade the ​stock in sufficient size.

FTSE Russell removed, GoTo from its global ​equity index series (GEIS) mid-cap index in June after the company was listed ‌on ⁠the Indonesian stock exchange's development board, a market that does not meet FTSE Russell's eligibility criteria for GEIS.

“The decision is a technical one. It follows from our shares sitting at the ​50 rupiah floor ​price, where ⁠trading volumes have been low – it is not a consequence of business performance," GoTo said ​in an emailed response to Reuters on the ​MSCI decision.
"Index ⁠decisions are reviewed regularly, and we will remain in active dialogue with MSCI."

MSCI, in its August index review, added 55 companies ⁠to ​its All Country World Index and ​deleted 92 companies.

-Reuters