Jakarta. The Indonesia Stock Exchange (IDX) has indicated it will delist shares of textile giant Sri Rejeki Isman, also known as Sritex (IDX: SRIL), following the company’s announcement of a permanent shutdown effective March 1. The closure has triggered mass layoffs, affecting thousands of workers.

IDX’s Director of Corporate Valuation, I Gede Nyoman Yetna, said the exchange had met with Sritex management to confirm the decision. 

“We are awaiting the necessary documentation, including details on a potential buyback. Any delisting process must comply with existing regulations, including a mandatory buyback obligation for any company exiting the exchange,” Nyoman said at IDX’s main hall in Jakarta on Friday.

IDX had already flagged the potential delisting of Sritex on May 18, 2022, after its shares were suspended across all trading platforms for 12 months. 

Sritex shares reached an all-time high of Rp 497 on July 30, 2015. In its last trading session on May 18, 2021, the stock plunged to Rp 146.

Under IDX rules, a company may be delisted if it faces severe financial or legal difficulties that significantly impact its business viability. If a firm fails to demonstrate a credible recovery plan, delisting becomes inevitable.

On Thursday, thousands of Sritex employees began packing up their belongings following a bankruptcy ruling by Indonesia’s Supreme Court. The decision sealed the fate of one of Indonesia’s largest textile manufacturers, marking the end of its operations after years of financial struggles.