Which Indonesian Stocks Gave Investors the Best Returns in 2016?
Most listed companies on the Indonesia Stock Exchange have now released their corporate earnings reports (covering full-year 2016) and this enables us to determine which companies' shares have been the most lucrative ones last year. Four companies stand out in terms of return on asset (RoA), return on equity (RoE), and return on invested capital (RoIC). These are (1) Matahari Department Store, (2) Unilever Indonesia, (3) Surya Citra Media, and (4) HM Sampoerna.
In determining which companies had the best RoA, RoE, and RoIC in 2016 we only focus on companies listed in the LQ45 index. This index, compiled by the research and development division of the Indonesia Stock Exchange (IDX), consists of 45 stocks that meet a number of specific criteria.
• being among the top 60 companies with the highest market capitalization over the past 12 months
• being among the top 60 companies with the highest transaction value over the past 12 months
• having been listed on the Indonesia Stock Exchange for at least three months
• having good financial conditions, future prospects and corporate management
In other words, if a company is listed in the LQ45 index then it means its shares are among Indonesia's most traded stocks.
Best Indonesian Companies in the LQ45 Index (2016):
| Company | Return on Asset (RoA) |
Return on Equity (RoE) |
Return on Invested Capital |
| Matahari Department Store | 46.17% | 136.40% | 135.90% |
| Unilever Indonesia | 39.36% | 134.09% | 108.60% |
| Surya Citra Media | 31.98% | 45.67% | 39.38% |
| HM Sampoerna | 31.70% | 38.56% | 35.95% |
Source: Investor Daily