Indonesia Energy Corporation Limited

Indonesia Energy Corporation Limited (NYSE: INDO) through its subsidiaries, operates as an oil and gas exploration and production company in Indonesia. It holds interests in the Kruh Block, a producing block covering an area of 258 square kilometers with net crude oil proved reserves of 2.63 million barrels located to the northwest of Pendopo.

Key Highlights

• Highly Volatile: INDO shares are highly volatile, recently on March 08^th, 2022 its shares lost approximately 49.59% in a single day trading session, and yet not recovered losses over the past two trading session, its seems that stock is largely controlled by operators.
• Technical indicators: As on March 10^th, 2022, its shares are again hitting the upper band of the Bollinger Band© which indicates that a potential pullback could further takes place in the stock in next few couple of trading session.
• Volatile oil prices: After recent rally in the oil prices over the past one months on the back of Russia and Ukraine episode, WTI Oil Futures tumbled approximately 13.5% in the last two trading sessions. Oil could remain quite volatile for next couple of trading session which can have an exponential impact on the Oil related stocks as well, especially small-caps and penny caps could be more volatile compared to mid-caps and large-caps.

Stock recommendation

INDO fundamentals are quite poor with negative gross margin, EBITDA margin, Net margin and moreover these losses are widening as well on sequential quarter basis. Further, stock is significantly volatile and seems that largely controlled by operators. Hence, we give an “Avoid” rating at the current price of USD 48.38 as on March 10, 2022, at 03:49 PM ET.

1-year Price Chart (as on March 10, 2022, at 03:49 PM ET). Source: REFINITIV, Analysis by Kalkine Group

* The reference data in this report has been partly sourced from REFINITIV.