Indonesian Billionaire Prajogo Pangestu Sees US$2.7 Billion Fortune Evaporate Amid Market Rout

Indonesian billionaire Prajogo Pangestu experienced a significant financial setback on Monday, October 27, 2025, as his net worth plummeted by US$2.7 billion. This substantial 6.26 percent drop was primarily triggered by a widespread market rout affecting shares of his Barito Group companies, as reported by bernama.

The dramatic decline positioned Pangestu as the day's biggest loser among local tycoons, with his fortune shrinking to US$40.3 billion, according to bernama. This placed him at 46th on Forbes' Real Time Billionaires List, a notable shift from his recent peak.

Shares across his Barito Group portfolio tumbled, including Barito Pacific (BRPT), Petrindo Jaya Kreasi (CUAN), and Barito Renewables Energy (BREN), as detailed by Bernama. The broader Jakarta Composite Index (JCI) also saw its steepest fall in over six months, impacting numerous Indonesian equities.

The market downturn was largely fueled by investor concerns surrounding a consultation paper from MSCI Inc., which proposed changes to the free-float calculation for Indonesian securities, The Business Times reported. Such adjustments could potentially reduce the index weighting of several major companies.

Brokerage firm Pilarmas Investindo noted that these proposed methodology changes, particularly regarding free-float adjustments, intensified the market's drop. The uncertainty surrounding these revisions prompted a significant sell-off among investors.

Further exacerbating the situation were continued capital outflows, with Bank Indonesia reporting that foreign investors had withdrawn Rp 940 billion from the domestic financial market between October 20 and 23, bernama stated. Analysts also pointed to profit-taking after months of steep gains in conglomerate stocks.

Muhammad Wafi, head of research at KISI Sekuritas, characterized the correction as a "cooling-off phase" rather than the onset of a long-term bear market, suggesting it's a natural reaction to extreme rallies. This sentiment indicates that some market participants view the recent volatility as a necessary adjustment.

• Background Context and Historical Perspective: Prajogo Pangestu's fortune has seen considerable volatility throughout 2025. His net worth had soared by an impressive US$20 billion since April, reaching US$36.2 billion by August 1, 2025, according to the Bloomberg Billionaires Index. His wealth peaked at US$48.3 billion on October 11, 2025, as reported by Forbes' Real-Time Billionaires data. However, he also experienced a US$10.5 billion loss in February 2025 and a US$5.9 billion drop in September 2025, often linked to index rebalancing concerns.

• Key Stakeholders and Their Positions: The Barito Group, central to Pangestu's wealth, saw significant share price drops on Monday. Barito Pacific (BRPT) fell 9.34 percent, Petrindo Jaya Kreasi (CUAN) slid 7.31 percent, and Petrosea (PTRO) plunged 9.44 percent, bernama reported. Barito Renewables Energy (BREN) also slipped 3 percent, while Chandra Daya Investasi (CDIA) fell 5.36 percent. Notably, Chandra Asri Pacific, the group's petrochemical arm, managed a modest gain of 1.72 percent.

• Economic Implications and Market Impact: The Indonesian stock market, represented by the Jakarta Composite Index (JCI), experienced a sharp decline of nearly 2 percent to 8,117 points on Monday, according to bernama. Trading Economics noted that the JCI fell to 8063 points on October 28, 2025, losing 0.67% from the previous session, marking its second day of losses. This downturn was exacerbated by foreign investors withdrawing Rp 940 billion from the domestic financial market between October 20 and 23, as reported by Bank Indonesia.

• Regulatory and Methodology Changes: A primary catalyst for the market's unease was a consultation paper from MSCI Inc. seeking feedback on how to estimate the free float of Indonesian securities, The Business Times stated. Proposed changes to this calculation could reduce the index weight of some companies, making it harder for Indonesian stocks, particularly "tycoon-related stocks" like Barito Renewables Energy, to be included in the MSCI Index, according to Aldo Perkasa, Head of Research at Trimegah Sekuritas Indonesia.

• Expert Opinions and Analysis: Analysts from Mirae Asset Sekuritas Indonesia attributed the sharp decline in the Composite Stock Price Index (IHSG) to market jitters over MSCI's potential free-float calculation revisions. Muhammad Wafi, head of research at KISI Sekuritas, suggested that conglomerate stock valuations had become "too expensive" after months of steep gains, leading investors to lock in profits. He viewed the correction as a "cooling-off phase" rather than a long-term bear market.

• Related Developments and Broader Impact: The market rout was not limited to Prajogo Pangestu. Other prominent Indonesian billionaires also suffered significant losses on Monday, bernama reported. Haryanto Tjiptodihardjo saw his net worth plunge US$1.1 billion, while Hermanto Tanoko lost US$912 million. This indicates a broader market sentiment shift affecting large-cap and conglomerate stocks across the board.

• Potential Future Developments and Next Steps: The market remains cautious ahead of MSCI's upcoming free-float adjustment, with investors closely monitoring its potential impact on corporate group stocks, Trading Economics noted. The volatility highlights the sensitivity of the Indonesian market to changes in global index methodologies and investor sentiment, particularly concerning liquidity and free-float definitions.