Stock Market: What Were Indonesia's Top Picks in 2015?
Although the Jakarta Composite Index, Indonesia's benchmark stock index, fell 12.13 percent during the year 2015, not all shares of listed companies were in red territory last year. It is interesting to take a look at those shares, particularly the blue-chip stocks, that still managed to rise amid unconducive domestic and global economic conditions. Therefore, we present the top gainers of the LQ45 index. This LQ45 index, created by the research and development division of the Indonesia Stock Exchange, consists of 45 stocks that meet specific criteria.
As stocks within the LQ45 index have to fulfill specific criteria they are more stable and reliable than the average stock on the Indonesia Stock Exchange (IDX) and therefore investors will be interested to learn more about this index (the composition of the LQ45 is adjusted twice per year, in February and August). The criteria that have to be fulfilled by companies in order to be eligible to be included in the index are:
• being among the top 60 companies with the highest market capitalization over the past 12 months
• being among the top 60 companies with the highest transaction value over the past 12 months
• having been listed on the Indonesia Stock Exchange for at least three months
• having good financial conditions, future prospects and corporate management
The top performer in the LQ45 during 2015 was Sri Rejeki Isman (better known as Sritex), a vertically-integrated textile and garment manufacturer in Indonesia. Its shares rose a staggering 138.65 percent over the year. Despite the challenges in the domestic textile industry Sritex continued to post good corporate earnings (net profit grew 30 percent year-on-year to USD $38.3 million in the first nine months of 2015). However, it is also speculated that this company has been a popular stock pick as it has its headquarters in Solo, the Central Java town where President Joko Widodo (who was inaugurated as Indonesia's seventh president in October 2014) was born and raised.
The second-best performer in the LQ45 in 2015 was AKR Corporindo, a leading provider of integrated supply chain solutions, distributing and trading petroleum and basic chemicals. Its shares rose 74.15 percent over 2015. Investors responded positively to the company's plan to diversify its business
Top Gainers & Losers LQ45 Index in 2015:
| Company | YoY Growth |
Company | YoY Growth |
| Sri Rejeki Isman | +138.65% | Tambang Batubara Bukit Asam | -63.80% |
| AKR Corporindo | +74.15% | Indo Tambangraya Megah | -62.76% |
| Matahari Department Store | +17.33% | Vale Indonesia | -54.90% |
| Sawit Sumbermas Sarana | +17.12% | Perusahaan Gas Negara | -54.25% |
| Waskita Karya | +16.55% | Adaro Energy | -50.48% |
| Unilever Indonesia | +15.55% | Matahari Putra Prima | -40.16% |
| Telekomunikasi Indonesia | +8.95% | Tower Bersama Infrastructure | -39.43% |
| Summarecon Agung | +8.55% | Alam Sutera Realty | -38.75% |
| Pembangunan Perumahan | +8.39% | Wijaya Karya Beton | -36.54% |
| Bank Tabungan Negara | +7.47% | Astra Agro Lestari | -34.64% |
Indonesia's Jakarta Composite Index fell 12.13 percent in 2015 due to various factors: severe volatility due to monetary tightening in the USA and concern about China's economic slowdown (leading to capital outflows from emerging markets), the fragile rupiah (weakening more than 10 percent against the US dollar over 2015), and the continuation of Indonesia's economic slowdown.
The table below shows the performance of each sectoral index (the Jakarta Composite Index is divided in nine separate sectoral indices). The table shows that all indices declined last year, led by the mining and agriculture sectors. These sectors have been plagued by weak commodity prices due to sluggish global economic growth (particularly the economic slowdown of China, the world's second-largest economy).
Performance Indonesia's Benchmark Stock Index & Nine Sectoral Indices in 2015:
| Index & Sectors |
YoY Growth |
| Jakarta Composite Index (IHSG) | -12.13% |
| - Agriculture | -26.87% |
| - Mining | -40.75% |
| - Basic Industry | -24.98% |
| - Miscellaneous Industry | -19.11% |
| - Consumer Goods | -5.19% |
| - Property & Real Estate | -6.47% |
| - Infrastructure, Utilities & Transportation | -15.42% |
| - Finance | -6.10% |
| - Trade, Services & Investment | -3.31% |
Profile Indonesia's Stock Market in 2015:
| |
|
| Jakarta Composite Index (IHSG) | 4,593.01 |
| P/E Ratio (x) | 16,79 |
| Market Capitalization | IDR 4,873 trillion |
| Daily Trading Value | IDR 5.76 trillion |
| Foreign Net Selling | IDR 22.58 trillion |
| Number of IPOs | 16 (and 2 re-listings) |
| IPO Value | IDR 11.27 trillion |
| Number of Rights Issue | 19 |
| Rights Issue Value | IDR 42.25 trillion |
| Number of Investors | 434,000 |