JAKARTA – Danantara Indonesia (Badan Pengelola Investasi Daya Anagata Nusantara), the nation’s esteemed state investment management body, has publicly unveiled its comprehensive criteria for selecting future stock investments within the dynamic Indonesian capital market. This strategic move signals Danantara’s intent to become a significant player, guided by a robust and judicious investment philosophy.
During a “Media Lunch with Danantara Indonesia” event in Jakarta on Friday, November 28, 2025, Ali Setiawan, Managing Director of Treasury at Danantara Indonesia, elaborated on the stringent indicators that will inform their investment decisions. He firmly stated, “We will not venture into speculative ‘gorengan’ stocks or those exhibiting extraordinarily high Price to Earnings Ratios (PE).” Instead, Danantara will conduct thorough assessments based on key financial metrics such as Return on Equity (ROE), PE ratio, dividend yield, market capitalization, overall profitability, and daily liquidity. This disciplined approach underscores their commitment to stable and sustainable growth.
Setiawan confirmed that Danantara Indonesia is poised to begin allocating its investments to the Indonesian capital market in the near future. He highlighted the capital market’s strategic advantage over the banking sector, noting its inherent liquidity and capacity to accommodate substantial fund placements, making it an ideal avenue for the institution’s ambitious investment goals.
Looking ahead, Setiawan outlined Danantara’s five-year vision as a Sovereign Wealth Fund (SWF) operating under a dual mandate objective. This balanced approach will encompass investments in critical strategic projects, private ventures promising strong commercial returns, and active participation in the capital market to generate attractive returns. This diversified strategy aims to achieve a harmonious balance across various investment classes.
Despite its optimism, Danantara remains acutely aware of certain challenges. Setiawan pointed out that the Indonesian stock market currently exhibits lower liquidity compared to its counterparts in more developed nations. He stressed that improving market liquidity is crucial for further market deepening and enhancing its overall appeal to both domestic and international investors.
Danantara Guarantees Prudent Investment Placement
Ali Setiawan further emphasized that Danantara’s investment strategy is fundamentally rooted in principles of prudence, supported by an experienced human resource foundation and robust governance. While the treasury division spearheads funding orchestration, all investment direction decisions adhere to strict professional standards. This ensures that every capital injection and fund placement is underpinned by a clear policy framework, a comprehensive assessment process, and well-defined risk mitigation strategies.
He proudly affirmed that the professionals joining Danantara possess impressive credentials, boasting 10, 20, or even 30 years of experience gained at highly reputable institutions. This wealth of expertise forms the backbone of Danantara’s rigorous decision-making process, instilling confidence in their investment choices.
Setiawan reiterated that the institution’s investment objectives are never driven by mere opportunism. Instead, they are firmly anchored in meticulously built and rigorously tested platforms and governance structures. He cautioned that any organization failing to establish an adequate assessment framework and comprehensive risk mitigation strategies essentially neglects to consider the worst-case scenarios inherent in every investment undertaking.
“We want to ensure our investments are truly prudent,” Ali stressed. “We cannot simply invest and then, when questioned about our processes or whether we have adequate risk mitigation in place, find ourselves without a clear answer.” This highlights Danantara’s unwavering commitment to accountability and thoroughness.
For its inaugural year, Danantara has prioritized the critical phase of foundation building. This involves meticulously establishing comprehensive policies, Standard Operating Procedures (SOPs), and investment mandates before executing large-scale investment objectives in either the private sector or the capital market. A dedicated control function and “deepening team” will meticulously review all policies to ensure the highest quality analysis and strict adherence to institutional mandates.
Ali added that Danantara’s overarching investment objective is to deploy capital into projects and instruments that have successfully undergone multiple layers of in-depth assessment and exhaustive risk simulation, rather than merely chasing short-term returns. This meticulous approach is designed to ensure that every funding decision remains liquid, productive, and resiliently defensive against market pressures or unforeseen emergencies.
“If all these foundational elements are absent, it implies we haven’t adequately considered the worst-case scenario for that particular investment,” Ali pointed out, underscoring the critical importance of foresight.
Furthermore, Danantara is actively developing anticipatory mechanisms to address potential risks that may arise from any chosen investment, both during the initial placement phase and post-execution. Ali stated that these potential risks must be meticulously calculated and addressed proactively through diligent assessment and simulation processes. This forward-thinking strategy aims to safeguard the institution’s stability and ensure a sustainable positive impact for national interests.
“Our goal is to ensure that all potential risks that might emerge in the future have been thoroughly considered and effectively anticipated,” Ali concluded, emphasizing a proactive stance on financial stability.
In a significant development, Danantara Indonesia has forged a strategic collaboration with PT Bursa Efek Indonesia (BEI), also known as the Indonesia Stock Exchange (IDX). This partnership is designed to catalyze innovation and enhance the vibrancy of the Indonesian capital market. The collaboration notably explores the potential formation of a “Danantara x IDX Index” and aims to expand the global reach of Exchange Traded Funds (ETFs).
Rosan Roeslani, Chief Executive Officer (CEO) of Danantara Indonesia, articulated the objectives of this groundbreaking initiative: “This initiative aims to elevate transparent investment benchmarks, improve investor accessibility, and ensure that Indonesian capital market products are highly relevant and competitive within global trends.”
Summary
Danantara Indonesia, a state investment management body, has unveiled its stringent criteria for selecting stock investments within the Indonesian capital market. The institution will avoid speculative stocks and those with extraordinarily high Price to Earnings Ratios (PE), prioritizing thorough assessments based on metrics like Return on Equity (ROE), dividend yield, market capitalization, profitability, and daily liquidity. Danantara plans to commence investments soon, operating as a Sovereign Wealth Fund with a dual mandate to generate attractive returns across various investment classes.
The investment strategy emphasizes prudence, robust governance, and experienced human resources, with a meticulous focus on risk mitigation and multi-layered assessments to ensure long-term stability and resilience over short-term gains. Despite recognizing lower market liquidity in Indonesia, Danantara is actively building foundational policies and procedures. Furthermore, Danantara has strategically partnered with the Indonesia Stock Exchange (IDX) to foster innovation, aiming to elevate transparent investment benchmarks, improve investor accessibility, and expand the global reach of products like Exchange Traded Funds (ETFs).