JAKARTA - Director of PT Industri Jamu dan Farmasi Sido Muncul Tbk (SIDO), Irwan Hidayat emphasized the importance of the Indonesian people to start switching to stock market investment as a tangible step to develop personal finances while strengthening the foundation of the national economy.
Irwan assessed that the investment opportunities in the capital market are currently not being fully utilized by the general public, which is reflected in the still low number of domestic investors compared to the total population.
Based on data from the Indonesian Central Securities Depository (KSEI), the number of stock investors in the country has only reached around 20.3 to 21 million people, or only around 7.5 percent of the total 270 million Indonesian population.
This figure is far behind compared to developed countries such as the United States, where Gallup data in 2024 showed that 62 percent of the adult population had stock instruments.
Irwan emphasized that this small participation is an obstacle to the strength of the domestic capital market.
"The number is still very small. In fact, if we want our market to be strong, the number of investors must be large. In Indonesia there are only about 20 million people, that's only 7.5 percent. In America it's 62 percent. In fact, collecting shares of well-managed companies is much more profitable than being stored 'under the pillow' or in the bank," said Irwan Hidayat, Friday, March 13.
According to Irwan's observations, low financial literacy makes many people still stuck in a conventional mindset by saving money in the bank or even storing it in cash at home.
He even found a case where people kept tens of millions of rupiah in a closet just because they were worried about bank administration costs, a habit that he considered very unproductive because the value of money did not grow and lost the opportunity to make a profit.
Irwan explained that the average bank interest is only around 2 to 3 percent per year, while stock investments have much higher growth potential if done properly.
"If the stock can be 40 percent. At least 15 to 20 percent can be obtained per year, provided you choose a healthy and honest company. If you invest in good stocks, in two years you can make a profit of 30 percent to 40 percent," he explained.
However, Irwan gave a critical note and a stern warning that the public was able to distinguish between serious investments and speculation, often referred to as "main stock".
He reminded the public not to view the capital market as a mere speculation because fear of losses often arises from bad experiences due to the wrong way.
He advised prospective investors to study basic indicators such as Price Earning Ratio (PER) so that the decisions made are more rational and measurable.
"If you have Rp. 10 million, Rp. 20 million, up to Rp. 100 million, invest. But don't play stocks. Investing is serious, not a joke. If you play, it's not right. Choose a company that is well managed, honest, healthy, and has a proven reputation in the long run," said Irwan.
Furthermore, the boss of Sido Muncul considers that increasing the local investor base is the key to economic sovereignty so that the Indonesian capital market does not continue to depend on foreign funds that have large capital.
He has a big vision that the participation of local people can jump to 40 percent or equivalent to 100 million investors, so that the national stock market becomes more resilient to global shocks as happened in the United States.
"Now our market is still dominated by foreigners because local participants are few. Imagine if the participation increases by another 50 million people, the face of our shares will be very different. We are no longer dependent on foreigners. So, just choose good stocks, invest there so that our market will be great," concluded Irwan.
The English, Chinese, Japanese, Arabic, and French versions are automatically generated by the AI. So there may still be inaccuracies in translating, please always see Indonesian as our main language. (system supported by DigitalSiber.id)
