Dynamic politics Driving Consumer and Telecom Companies
Indonesia’s consumer and telecom sectors are primed for significant improvements during the election year. These industries are deliberately placed within political agendas, offering substantial profit possibilities.
Liza Camelia Suryanata, Head of Research at NH Korindo, says election years increase money circulation. This phenomena is closely related to presidential and vice-presidential candidates’ efforts to win votes and sympathy.
“In particular, with all the presidential and vice-presidential candidates being newcomers, they often attract sympathy through social assistance programs,” Liza said on Thursday’s sahambbk live Instagram session.
Liza emphasises that frying oil and sugar are particularly noteworthy. Cooking oil producers, notably palm oil producers, are eagerly awaiting election results to improve revenue.
Telecommunications may also benefit during elections. Online buzzers and predicted data consumption growth enable telecommunications providers to capitalize on demand.
Matching Stock Market Predictions
The Indonesian Stock Exchange (IDX or IHSG) is expected to stay over 7,000 through the end of the year, making these sectors attractive.
Liza offers IHSG scenario information. IHSG might reach 7,350–7,400 by year’s end in the best case. The worst-case scenario predicts IHSG around 7,050 to 7,100.
IHSG is likely to benefit from election sentiment and foreign investor backing. Liza notes that presidential and vice-presidential candidates’ work policies will influence foreign investment in Indonesia.
She says “The clarity of their work programs will instill confidence in foreign investors, encouraging increased involvement in Indonesia.”
RTI Business Indonesia reported a 0.20 percent gain in IHSG to 6,937 on Wednesday (27/9/2023). IHSG gained 1.27 percent this year.
Foreign investment data shows a net sell-off of IDR 228.10 billion across all markets. Net foreign sell-off across all markets is IDR 4.22 trillion, while net foreign buy in the regular market is IDR 9.41 trillion.
Economic Resilience and Foreign Investment
The robust economy of Indonesia, as seen by IHSG’s success, shows investors’ trust in the market. Indonesia’s good development encourages foreign investors despite global worries.
Government spending and consumer confidence rise during elections. Political campaigns boost economic activity in numerous industries, creating business prospects.
Sector-Specific Investor Strategies in Consumer and Telecom
Investors in consumer and telecom should use sector-specific techniques. Consumers may benefit from focusing on food producers and distributors. Additionally, monitoring telecommunications businesses, particularly data providers, may be important.
In conclusion, political dynamics, solid economic indicators, and strategic sectors prospects make Indonesia an interesting market for investors. Throughout the election year, market participants will closely monitor events and adjust their plans to capitalize on the changing economic picture.