Chute
FULL MEMBER
- Joined
- Jan 26, 2023
- Messages
- 263
- Reaction score
- 0
- Country
- Location
Largest Indonesian companies are Pertamina and PLN, since their stake owned 100 % by government so their stakes are not traded in stock market. MIN ID is also not traded in stock market despite it owns 51 % Freeport Indonesia and 20 % Vale Indonesia.
How about see the assets as Indian companies market capitalization is big due to being inflated by their stock market hype. See how Andani business market valuation can be busted so easily....
If Indonesia GDP growth is greater than India, I bet many foreign investors will see India PE ratio as too expensive
This Indian Q1 2023 growth rate will be important to see Indian companies future value in their stock market. Will foreign investors still see them the same if Indian economic growth is not as phenomenal as their economists like to project...?
Adani has stabilised and recovering market cap now though (when many kept saying it would be wiped away altogether)....not to mention its just one of many companies there.
Indonesia needs to diversify and invest in value addition a lot more. It is too reliant on natural resources still (coal, gas, palm oil etc) and this does not give the large qualitative market caps needed to leverage going forward for large population countries that need much more value addition sectors.
Results of Indonesia missing out (given lead it had over India 10 years ago, but now India has gained compared to it, even though India is a relative laggard compared to its potential):
Total export:
2012 INA = 230 billion USD
2022 INA = 290 billion USD (most growth coming from last 2 years)
2012 IND = 450 billion USD
2022 IND = 770 billion USD (most growth coming from last 2 years as well)
Forex level:
2012 INA = 120 billion USD
2022 INA = 140 billion USD
2012 IND = 300 billion USD
2022 IND = 600 billion USD
If Indonesia wants to make real gains this decade, we will need to see better composition and scale in its market cap (this is proof in the pudding), specifically in companies that have measurable value addition (and export oriented) and are not just traditional natural resource, finance, real estate etc.
When it comes to Unicorns, again India has created more than 100 so far, Indonesia only about 10. Its not good enough. Indonesia need to shift gears here.