Flooring Guide by Cinvex – JAKARTA – Retail giants PT Sumber Alfaria Trijaya Tbk. (AMRT) and PT Midi Utama Indonesia Tbk. (MIDI) are bracing for the arrival of a significant new competitor: the Red and White Village Cooperatives (Koperasi Desa Merah Putih). This ambitious national strategic program, championed by the government, has secured substantial state budget (APBN) funding and aims to establish an impressive 80,000 units across Indonesia.
The initiative, spearheaded by President Prabowo Subianto, is bolstered by pivotal changes in Village Fund (Dana Desa) regulations and substantial APBN financing. A remarkable 58.03% of the 2026 Village Fund, totaling Rp34.57 trillion out of Rp60.57 trillion, is earmarked for the program’s implementation, underscoring the government’s commitment to its success.
Despite this formidable new entrant, Muhammad Wafi, Head of Research at KISI Sekuritas, remains optimistic about AMRT and MIDI’s market position. Wafi asserts that the threat posed by Kopdes Merah Putih is minimal, primarily due to the established issuers’ significantly superior economies of scale and extensive distribution networks.
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“Their prospects are likely to surpass 2025, buoyed by the financial circulation momentum from regional elections (Pilkada), the distribution of social assistance, and heightened Eid consumption. The primary challenge remains the potential impact of the Middle East conflict, though its effect is largely confined to possible increases in logistics costs, such as fuel prices,” Wafi explained to Bisnis, in remarks quoted on Saturday (28/3/2026).
Wafi further elaborated that the growth opportunities for both retail companies in 2026 are closely tied to their strategic expansion, particularly the addition of new outlets outside Java. Another key driver is the increased proportion of high-margin products, exemplified by ready-to-eat foods like Lawson offerings at MIDI. From an operational efficiency standpoint, both AMRT and MIDI benefit from optimized, centralized supply chain and logistics systems.
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Highlighting their resilience, Wafi categorizes AMRT and MIDI shares as defensive stocks. This classification stems from their sales being predominantly driven by Fast-Moving Consumer Goods (FMCG) and essential goods, which exhibit inelastic demand even in the face of weakening purchasing power, thus providing a stable revenue stream.
Reflecting his positive outlook, Wafi set a target price of Rp3,200 for AMRT and Rp450 for MIDI. At the close of trading on Friday (27/3/2026), MIDI experienced a 3.42% uptick, reaching Rp302, while AMRT saw a slight dip of 0.34%, closing at Rp1,455.
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Offering a more cautious perspective, Nafan Aji Gusta, Senior Market Analyst at Mirae Asset Sekuritas, recommends a “wait and see” approach for AMRT and MIDI investors. Gusta noted that neither stock has yet entered a clear uptrend phase, with the emerging Kopdes Merah Putih sentiment acting as an additional variable that significantly influences investor perception.
Nafan suggests that the 2026 outlook for both issuers will critically depend on their performance during the first quarter of 2026, as this will largely shape their fundamental prospects for the entire year. Should they deliver positive bottom-line results in Q1, Nafan anticipates this momentum could extend throughout the full year.
“The expansion of Kopdes has, in fact, already been priced into the performance of AMRT and MIDI stock price movements, which have not been in an uptrend. Both issuers had previously undergone a markdown phase,” Nafan concluded, implying the market has already factored in the new competition.