Market Volatility Spurs Investment Opportunities: Lo Kheng Hong Increases Stake in BBRI
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A sharp market downturn on March 18, 2025, triggered by significant foreign capital outflow, has prompted renowned investor Lo Kheng Hong to strategically increase his holdings, notably in Bank BRI (BBRI). This move highlights a contrarian approach, capitalizing on undervalued blue-chip stocks amidst market panic.
The Indonesian stock market experienced a dramatic day on March 18, 2025, witnessing a 7% plunge in the Composite Stock Price Index (CSPI), which forced the Indonesia Stock Exchange (BEI) to implement a trading halt
. This measure, designed to curb excessive volatility, was last seen during the height of the COVID-19 pandemic.
According to reports, the CSPI initially fell by 1.19% in the first ten minutes of trading, reaching 6,394.87 points. The decline accelerated, hitting 5.02% by 11:19 AM, triggering the initial trading halt at 6,146. Trading resumed briefly, only to see the index plummet further, exceeding a 7% drop to 6018.39 before a slight recovery to close at 6076.081, a 3.84% decrease for the day.
Amidst this turmoil,seasoned investor Lo Kheng Hong revealed his surprise at the market’s sharp decline. I was buying stock, because the stock price fell a lot, suddenly trading halt, surprised for a while, then got the news trading halt,
he stated, indicating his active participation during the downturn.
Capitalizing on Market Fear: A Strategic Shift
Hong attributes the falling stock prices to a significant outflow of foreign funds, which has disproportionately impacted blue-chip stocks.Though, rather than retreating, he views this as an opportune moment.
Foreign funds run away, the price of blue chip stocks has fallen a lot,
Hong observed.
In a bold move, Hong has reportedly liquidated his mutual funds, withdrawn deposits, and sold his bond holdings to acquire shares in what he terms Fantastic Company
stocks being offloaded by foreign investors. This strategy reflects a belief in the long-term value of fundamentally sound companies, even during periods of market distress.
BBRI Investment: A Dividend Play
While the specific stocks targeted by Lo Kheng Hong during the market collapse remain largely undisclosed, it has come to light that he has significantly increased his stake in Bank BRI (BBRI), one of Indonesia’s largest banking institutions.
Hong confirmed his ample holding in BBRI, stating, This is my BBRI shares 64,636,000.
This investment appears to be driven, in part, by BBRI’s attractive dividend payout. The bank recently announced a dividend distribution of Rp 51.74 trillion, or Rp 345 per share, representing 85% of its 2024 net profit. After accounting for an interim dividend already distributed, Hong stands to receive approximately Rp 208.4 per share,totaling Rp 13.47 billion before taxes.
Based on the latest market price of Rp 3,700 per share, Hong’s BBRI holdings are valued at approximately Rp 239 billion. This significant investment underscores his confidence in the bank’s future performance and its ability to generate consistent returns for shareholders.
Market Outlook and Investment Strategies
Lo Kheng Hong’s actions serve as a reminder of the potential opportunities that arise during periods of market volatility. While a trading halt
can be unsettling, it can also create entry points for investors with a long-term perspective and a focus on fundamentally strong companies. As of today, the market is still showing signs of recovery, but the long-term effects of the recent volatility are yet to be seen. Investors are advised to conduct thorough research and seek professional advice before making any investment decisions.
