Warakirri sees Indonesia equities as undervalued after foreign selling hits USD 3 billion
EIDO•Risk premium and macro backdrop
Risk premium lifted 100 bps to 16%, while Indonesia allocation was held near 6% as macro metrics stayed stable around 5% growth.
Downgrade risk and governance concerns
MSCI freeze raised downgrade risk; the IDX warned a Frontier demotion could trigger about USD 45 billion in additional foreign outflows.
Officials moved to address governance concerns, including a 15% minimum free float, a 1% disclosure threshold, and tighter ownership rules.
Warakirri sees Indonesia equities as increasingly attractive
Warakirri analysis flagged Indonesia equities as increasingly attractive despite foreign selling of about USD 3 billion since October 2024.
Market de-rating sharpened valuations, with the local P/E a little above 11x and the dividend yield above 5.7%, with Telkom about 8%.
