The Federal Reserve's decision not to change its quantitative easing program seems to have led to a bullish market in Asia. Indonesia's benchmark stock index (IHSG) rose 4.37 percent to 4,658.2 points after the first session on Thursday's trading day (19/09). All sectoral indices were up, with the property sector in leading position. Big cap stocks, in particular, performed well. Investors are relieved that the Fed did not alter its stimulus program. Thus, funds are expected to continue flowing to emerging markets, including Indonesia.

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Indonesia's largest telecommunication & network provider Telekomunikasi Indonesia (Telkom) has conducted a stock split with a ratio of 1:5 yesterday (29/08). The company, which is majority owned by the Indonesian government and has a dominating market share of around 47% in terms of mobile phone subscribers in Indonesia, decided to conduct the stock split to increase the company’s share liquidity. A cheaper price will be more appealing to investors. The stock split was agreed upon at the general shareholders' meeting on 19 April 2013.

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In recent years, Astra International, one of Indonesia's largest diversified conglomerates, dominated the Indonesia Stock Exchange (IDX) in terms of market capitalization. However, it increasingly felt the competition of HM Sampoerna, Indonesia's largest tobacco company. Over the last five years, HM Sampoerna's market capitalization grew by a staggering 746.2 percent. It is also interesting to note that a  handful of Indonesian companies account for over one-third of market capitalization of Indonesia's stock exchange.

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Telekomunikasi Indonesia (Telkom), Indonesia's largest telecommunication & network provider, plans to conduct a stock split this year with a ratio of 1:5. This step will make Telkom's shares more affordable and increases its liquidity. Analysts have good projections for the company as it holds a dominant market position in Indonesia's telecommunication sector, a high dividend ratio, and good corporate management. Its share price gained 25.7 percent this year.

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Despite foreign investors recording a net buy on the Jakarta Composite Index on Thursday (31/10), a depreciating rupiah as well as falling stock indices across Asia made investors concerned. Thus, the benchmark index of Indonesia followed the pace of other Asian indices and ended on 4,510.63 points (a 1.40 percent fall). The outcome of the Federal Reserve's FOMC meeting did not support the rupiah. On the contrary, the rupiah fell after the Fed stated to continue quantitative easing but that the tapering may start sooner than expected.

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Indonesia's benchmark stock index (IHSG) was up 0.40 percent to 4,423.72 on Friday (27/09). The gain was mainly carried by demand for a number of Indonesian blue chip stocks. Astra International rose 1.16 percent after Deutsche Securities Indonesia, Credit Suisse Securities Indonesia and Citigroup Securities Indonesia increased their stakes in one of Indonesia's largest diversified conglomerates. Other blue chips that performed well were Perusahaan Gas Negara, Bank Mandiri, Telekomunikasi Indonesia and Indofood Sukses Makmur.

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Indonesia's largest company by market capitalization is still HM Sampoerna, the country's largest tobacco company. The company has been the top company in Indonesia since March 2013 when it replaced Astra International, Indonesia's largest diversified conglomerate, on the top spot. Astra had been Indonesia's largest company since 2010. Currently, the third-largest company in terms of market capitalization is Unilever Indonesia. Unilever, which is Indonesia’s largest consumer goods producer, jumped four places in the ranking since late 2012.

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For three consecutive days, Indonesia's main stock index (IHSG) had to cope with significant losses. On Tuesday (11/06), the index fell 3.50 percent to 4,609.95 points, considerably below its record high level of 5,214 on 20 May 2013. Foreign investors recorded a net sell of IDR 3.98 trillion (USD $406.1 million) as domestic conditions in Indonesia are unstable. Moreover, investors are concerned about governments (USA and Japan) that want to slow down their stimulus programs as various economic data are showing positive outcomes.

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Last week, I provided a basic introduction to investments in Indonesia's capital markets. Now, I will devote my column to the ten largest Indonesian companies by market capitalization. But first let me explain why I take the ten largest companies? Well, simply because these ten companies account for 43.71 percent of Indonesia's total market capitalization. In other words, they reflect almost half of the current condition of the country's capital markets.

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