Indonesia’s Market Is Under Pressure. Have Fundamentals Changed as Much as Prices?

21 Oct 2026

Indonesia’s equity market came under heavy selling pressure in mid-October 2026 after MSCI launched a consultation on potentially reclassifying the country from an Emerging Market to a Standalone Market by June 2027. Although MSCI’s review targets ownership opacity in tightly held conglomerate stocks, global funds reducing country exposure naturally sell their most liquid holdings first.

Between October 15 and October 19, this index-driven outflow triggered sharp two-day drawdowns across Indonesia’s premier blue chips—none of which had issued negative earnings revisions. This raises a key question for investors: are falling share prices reflecting deteriorating fundamentals, or technical liquidity selling?

Against this backdrop, three blue chips accessible on the SGX via Singapore Depository Receipts (SDRs) offer distinct perspectives on Indonesia’s corporate landscape:

Bank Central Asia (SGX SDR: IBKD | IDX: BBCA): Banking Strength Amid Foreign Outflows

Bank Central Asia (BCA) is Indonesia’s largest private-sector bank and a primary liquidity proxy for foreign institutional investors. Following the MSCI announcement, BBCA shares fell 20.7% over two sessions (from Rp 6,075 to Rp 4,820) before rebounding 7.9% to Rp 5,200 on October 20 alongside an on-market management share buyback.

While Q1 2026 net interest margins eased 40 basis points year-on-year to 5.4%, BCA’s core franchise remains resilient. By August 2026, bank-only loans grew 11% year-on-year to Rp 1,018 trillion, supported by 10.8% growth in low-cost deposits and a contained 0.3% credit cost over the first eight months of 2026.

What investors should watch: Loan growth, deposit costs, net interest margins and credit quality to gauge whether price weakness stems from technical foreign outflows or borrower health.

Indofood CBP (SGX SDR: IICD | IDX: ICBP): Everyday Demand Meets Input-Cost Risks

Indofood CBP Sukses Makmur is a leading packaged-food manufacturer anchored by its flagship Indomie instant noodle brand. Serving everyday household needs, its domestic volume is historically less sensitive to economic cycles than discretionary sectors.

During the mid-October sell-off, ICBP retreated 15.5% from Rp 6,950 to Rp 5,875 by October 19, bringing its trailing valuation to single-digit price-to-earnings multiples despite unchanged operational guidance. For full-year 2026, management continues to guide for 5% to 7% revenue growth and a 20% to 22% EBIT margin, though profitability remains sensitive to wheat, palm oil and packaging costs, as well as Rupiah fluctuations.

What investors should watch: Revenue growth against full-year guidance, EBIT margin stability, raw material prices and foreign exchange movements.

Telkom Indonesia (SGX SDR: ITKD | IDX: TLKM): Cash Flow and Digital Infrastructure

Telkom Indonesia is the country’s largest telecommunications and digital infrastructure provider, spanning mobile services (Telkomsel), broadband and enterprise connectivity.

TLKM shares dropped 20.6% over two trading days from Rp 2,230 to Rp 1,770 on October 19, before surging 16.4% to Rp 2,060 on October 20 after management accelerated its Rp 4 trillion share buyback programme. Operationally, 1H 2026 consolidated revenue rose 3.9% year-on-year to Rp 75.9 trillion and normalised net profit grew 6.2% to Rp 11.3 trillion—driven by an 11% rise in digital-business data revenue, a 9% increase in mobile ARPU to Rp 45,600, and 19% growth in B2B infrastructure revenue.

What investors should watch: Mobile ARPU trends, B2B data-centre expansion, capital expenditure intensity and free cash flow generation.

What the Three Companies Tell Us

Company	Oct 16 & 19 Crash	Oct 20 Close	Key 2026 Fundamentals vs. Risks
BCA (IBKD \| 1:2)	-20.66% (Rp 6,075 to Rp 4,820)	Rp 5,200 (+7.88%)	11% loan growth & 0.3% credit cost vs. foreign outflows & NIM pressure
Indofood CBP (IICD \| 1:2)	-15.47% (Rp 6,950 to Rp 5,875)	Rp 5,775 (-1.70%)	5%–7% revenue growth guidance & staple demand vs. commodity & FX costs
Telkom (ITKD \| 1:5)	-20.63% (Rp 2,230 to Rp 1,770)	Rp 2,060 (+16.38%)	+6.2% 1H normalised profit & +19% B2B growth vs. telco competition & capex

A 15% to 21% share-price drop without an underlying earnings downgrade highlights how index-level uncertainty can compress market multiples across the board. However, a lower price alone does not guarantee outperformance; investors must still weigh corporate governance, currency exposure and sector-specific risks alongside earnings resilience.

Looking Beyond the Headlines

For Singapore investors looking to monitor or gain exposure to Indonesia’s blue chips without opening a foreign brokerage account, SGX-listed SDRs provide a direct local channel:

Bank Central Asia ID SDR — SGX: IBKD

Indofood CBP ID SDR — SGX: IICD

Telkom Indonesia ID SDR — SGX: ITKD

Traded in Singapore Dollars (SGD) in standard 100-unit board lots and custodised directly in CDP accounts, SDRs allow investors to evaluate company fundamentals within a familiar local trading framework.

Trade SGX-listed SDRs on NOVA now.

Receive 40 FREE LSS Shares* when you open a new NOVA Trading Account and invest S$1,000 in SGX-listed stocks or ETFs. Find out more here.

Trade CFDs, ETFs, Forex, Futures, Options, Precious Metals, and Stocks on NOVA

Features of trading on NOVA

Gain Access to Over 20 Global Exchanges
Capture opportunities from over 200 global futures from over 20 global exchanges
Trade Opportunities in Global Stocks
Over 11,000 Stocks and ETFs across Singapore, US, China, Hong Kong, Malaysia and Japan markets.
Charting Powered by TradingView
View live charts and gain access to over 100 technical indicators
True Multi-Asset Trading
Trade CFDs, ETFs, Forex, Futures, Options, Precious Metals and Stocks on a single ledger on NOVA
USD & SGD Shares Margin Rate at Only 4.5% p.a
Fractional Shares from US$1

Start investing in fractional shares from US$1 notional value, at US$0.38 commission per order.

Free NOVA Demo Account

Fast and Secure Online Account Opening

An Exchange Traded Fund (ETF) is a marketable security that is formed to track nearly anything, ranging from a specific index, sector, commodity, or increasingly, theme. They are most commonly used to track a basket of stocks, and can typically be accessed through the same channels as regular stocks. ETFs are typically separated into passively-managed ETFs that simply mirror the security they are tracking (e.g. the STI), and actively managed ones that attempt to deliver higher returns or specific investment objectives, often with a pre-specified theme in mind (e.g. ARK Invest’s Innovation ETF).

Why should I trade in ETF CFDs?

ETFs have been growing in popularity over the years. 2020 was the best year for ETFs yet, with global equity ETFs seeing more than $1T in inflows within a 12-month period. Using CFDs to gain exposure to ETFs allows for greater capital efficiency because only a portion of the contract value is required as margin to establish a position.
ETFs are particularly popular with investors seeking a relatively hassle-free investing experience, while desiring exposure to a range of specific and relatively understandable securities. Trading ETF CFDs brings greater convenience by eliminating the need for traders to hold multiple currencies in order to access global ETFs.
An investor wanting exposure to the post-pandemic economic recovery could open a position in the well-known SPDR S&P 500 ETF (SPY), which tracks the performance of the S&P 500. Another investor that may be convinced of the future importance of Environmental, Social and Governance concerns (ESG) may find the increasing selection of ESG-themed ETFs that track a basket of high ESG-rating companies to be a good investment, rather than cherry-picking individual equities by hand. ETF CFDs can act as a powerful tool for traders can profit from both directions of the market by taking on long or short positions.

A look at two ETF CFDs we offer:

1) Has the ARKK been sunk?

ARK Innovation ETF (ARKK) ARKK is an actively managed ETF by ARK Invest that invests in a range of companies based on their innovative and industry-disrupting potential. ARKK’s largest holdings are in companies such as Tesla, Square, and Zoom. ARKK is down around -33% from peaking on 12^th Feb and is currently in the red for the year to date as the market experiences a risk-off outflow of funds. Superstar fund manager Cathie Wood has however been consistently doubling down on her bets, buying even more shares in growth stocks that are going through their own tumultuous periods such as DraftKings, Peloton, Teladoc, and Tesla. In her view, ARKK is playing the long game, and remains steadfastly convinced in the long-term prospects of these growth stocks beyond this current bout of volatility. Similarly on outflows, investors are still betting big on ARKK as ARK Invest has only lost about $1.2B in assets this year across all its six funds, compared to seeing an inflow of $15.1B during the same period. Recently, investors have been nervously eyeing ARKK’s basket of tech stocks as their future earnings potential remain vulnerable to erosion through high inflation – the dominant concern of the market in recent weeks. As commodities – the major contributor to the recent heightened inflation fears – drops sharply from record highs, are investor concerns over hyperinflation overblown?

2) Searching for exposure to Asian equities?

iShares MSCI Asia ex Japan ETF (AAXJ) The AAXJ is currently trading -10.6% adrift of all-time highs seen in February, giving up gains in tandem with an Asia-wide equity sell-off at the time. Given that slightly over 40% of the ETF’s holdings are based in China, the ongoing tumult seen in Chinese equities currently have carried over nearly perfectly in the AAXJ, as Chinese investors take a breather after the stellar gains made over the past year. Looking ahead, Asia – and particularly China, is steaming ahead with its economic recovery. China is widely expected to be one of the best-performing major economies this year, providing a major boost to the outlook for corporate earnings. As the rest of Asia and the world gradually opens up their own economies, AAXJ is likely to again benefit from strong Asian outperformance amidst a strengthening trade outlook.

CFD is available for trading on Phillip MetaTrader 5 (MT5).

Features of trading CFD:

Trade in both the bull and the bear markets
The ability to enter a long and/or short position allow traders to take advantage of both rising and falling markets.
Smaller barrier to entry
Flexible and smaller contract sizes. This means that traders will be able to enter into a contract with a modest amount of capital.
No expiration date or risk of delivery
Unlike futures which commonly have a fixed expiration date, CFD allows traders to perpetually hold the position(s). CFD is cash settled, no need to worry about the delivery of the underlying asset.

Benefits of using Phillip MT5:

Trade at zero commission on a dynamic platform that offers low spreads. Integrated with Autochartist and Trading Central Indicators, and available on mobile, web and desktop app, you will never miss a trading opportunity with Phillip MT5.

Register for a FREE 30-day Phillip MetaTrader 5 Demo Account

More Market Trends

14 Oct 2026

Oil Above US$100: Could Middle East Tensions Trigger Another Price Surge?

Client Portal