Rosan: State-Owned Enterprise Shares Still Attractive for the Long Term

Head of the Investment Management Agency (BPI), Danantara Rosan Roeslani, says state-owned enterprise shares listed on the Indonesia Stock Exchange (BEI) remain attractive for long-term investment.

According to him, a number of state-owned shares can even deliver yields above 10 percent, up to 11 percent.

‘From our perspective, investments in the stock exchange at Danantara are long-term investments,’ Rosan said after visiting the BEI Building in Jakarta on Tuesday, 19 May.

Rosan said the fundamentals of the SOEs listed on the exchange remain quite strong, particularly in the banking sector and mineral mining companies.

‘And if we look at the SOEs on the exchange, case by case—for example, the Himbara banks or mining companies—the yields are also very good at above 10-11%,’ he said.

Rosan also praised the Financial Services Authority (OJK) and BEI for ongoing reforms of Indonesia’s capital market, ranging from increased transparency to strengthened market governance.

According to him, the market reforms will increase investor confidence in Indonesia’s capital market in the long term.

‘A process that we believe will instil greater confidence in our exchange moving forward,’ he added.

Rosan assessed that Indonesia’s capital market is currently on the right track, even though it faces various global and domestic challenges.

‘Therefore, when you look again, both fundamentals and pricing of shares—especially the SOEs listed on the exchange—will yield a good medium-to-long-term yield above 10-11%,’ Rosan explained.

Although the domestic stock market is still fluctuating, Rosan emphasised that Danantara does not view stock investment with a short-term approach.

‘I am very confident that going forward, in the long run, our exchange will continue to grow in terms of market capitalisation, the number of listed issuers, and also in terms of investors,’ he said.

Rosan also noted that the number of retail investors in Indonesia’s capital market has grown to around 26 million to 27 million investors.

He said the increase in the number of investors demonstrates public confidence in the prospects of Indonesia’s capital market remains high.

‘Our exchange will be better going forward and promising; otherwise, the number of investors would be falling if there were no prospects for the market. The logic is as such,’ Rosan added.