IDX Composite Slumps Amid MSCI Shockwave: Panic Grips the Market While Dividends Spike!
A massive sell-off suddenly hit Indonesia’s stock market. The Jakarta Composite Index (IHSG) plunged to its lowest level since 2020, a decline not seen in more than six years. The sharp drop also triggered a 30-minute trading halt.
MSCI’s proposal to downgrade Indonesia’s capital market to a “Standalone Market” sparked the sell-off. The proposal alarmed investors. Many feared that foreign funds could withdraw substantial amounts of capital.
Top Blue-Chip Stocks Offering Jumbo Dividend Yields During the Crash
Despite the market turmoil, some dividend stocks have attracted value-seeking investors. Falling share prices have pushed up the trailing twelve-month (TTM) dividend yields of major blue-chip companies.
According to market research, PT Bank Mandiri Tbk (BMRI) and PT Unilever Indonesia Tbk (UNVR) recorded the highest TTM dividend yields. Both companies posted yields of 14.8%.
Other major companies also recorded notable yields:
- PT Bank Rakyat Indonesia Tbk (BBRI): 12.6%
- PT Telkom Indonesia Tbk (TLKM): 11.7%
- PT Bank Negara Indonesia Tbk (BBNI): 11.6%
- PT Adaro Energy Indonesia Tbk (ADRO): 11.3%
Overall, 14 of the top 20 leading stocks now offer TTM yields above 8%.
Analyst Warning: Don’t Blindly Catch the Falling Knife!
However, high dividend yields do not automatically make a stock attractive. Analysts warn that these elevated figures reflect falling share prices, not necessarily higher dividend payments.
Chory Agung Ramdhani, Head of Department at BRI Danareksa Sekuritas, noted that TTM yields reflect past dividend payments. Therefore, they do not guarantee similar payouts in the future.
Meanwhile, major banks and conglomerates remain exposed to potential passive fund outflows. These companies include BBRI, BMRI, BBCA, ASII, and TLKM. They carry significant index weightings and rank among major MSCI constituents.
For that reason, investors should avoid buying aggressively during the downturn. Instead, they can consider gradually accumulating shares in fundamentally strong companies. They should also monitor further developments regarding MSCI’s proposal.
