Skip to content
Learning that drives better investment decisions

Indonesia Features Highest ROE

Watch the video with Andrew Stotz or read a summary of the country profile on Indonesia.

Four Pillars of GDP: Driven by private consumption

Overall, Indonesia is seeing positive growth, and all pillars are contributing to GDP growth.

Like most economies, Indonesia’s economy is mainly driven by private consumption and investment. Net exports offer almost nothing to GDP expansion. Private consumption contribution rose to 3.46% from 2.4% in the second quarter of 2016.

Highest ROE in Asia

Analysts expect Indonesia to deliver the highest ROE in Asia in 2017 at 16.1%. This is reflected in 2017’s price-to-book being the second most expensive in Asia. Only India trades at a higher PB.

#Indonesia Features the Highest ROE in #Asia

A. Stotz Four Elements: Indonesia’s rank relative to Asia

Overall, Indonesia is the third most attractive in Asia considering all our four elements: Fundamentals, Valuation, Momentum and Risk.

Fundamentals: Indonesia has the best ROE in Asia with 2017 consensus estimates of 16.1%.

Valuation: The nation is moderately attractive, as multiples are supported by fundamentals.

Momentum: Indonesia has moderate price and earnings momentum.

Risk: Indonesia has the most volatile stock market in Asia.

Strong performance in Materials and Energy

Top 3 largest sectors: Consumer Staples: 26% of the market. Financials: 25%. Consumer Discretionary: 12%.

Best sector & stock: Energy: +33.4% & Bumi Resources: +335.3%

Worst sector & stock: Telecom: -6.7% & XL Axiata: -17.7%


Are you investing in Indonesia?

If you like our research, share it with your friends.

DISCLAIMER: This content is for information purposes only. It is not intended to be investment advice. Readers should not consider statements made by the author(s) as formal recommendations and should consult their financial advisor before making any investment decisions. While the information provided is believed to be accurate, it may include errors or inaccuracies. The author(s) cannot be held liable for any actions taken as a result of reading this article.