Indonesia Stock Exchange (IDX) In-Depth Review | Is the Indonesian Stock Exchange Reliable? A Comprehensive Analysis of Market Size, Regulatory Environment, and Investment Opportunities (2025 Definitive Edition)

1. Background and Development of the Exchange

The Indonesia Stock Exchange ( IDX ) can be traced back to the Batavia Exchange in 1912. It was formed in 2007 by the merger of the Jakarta Stock Exchange (JSX) and the Surabaya Stock Exchange (SSX) . It is headquartered in Jakarta.

IDX is Indonesia's sole stock exchange and one of the fastest-growing capital markets in the ASEAN region . With Indonesia's economy now ranked among the top 20 globally, IDX has seen impressive growth in both funding and investor numbers.

2. Market Size and Core Data

• Number of listed companies : 943 (data at the end of 2024).

• Total market capitalization : approximately US$881 billion , second only to Singapore in the ASEAN region.

• Number of investors : More than 17 million (2024), more than doubling in the past three years.

• Main indices : IDX Composite (IHSG), covering all listed companies; LQ45 index represents the top 45 companies with the largest liquidity and market capitalization.

III. Supervision and Compliance

• Regulator : OJK (Indonesian Financial Services Authority, Otoritas Jasa Keuangan).

• System Features :

• Implement electronic reporting and disclosure system.

• Emphasize the convenience of listing for small and medium-sized enterprises and local unicorn companies.

• Regulatory transparency still needs to be improved, and the strictness is slightly lower than that of Singapore and Hong Kong.

⚠️Comment : The regulatory system is gradually improving, but the market still has room for improvement in terms of timeliness of information disclosure and corporate governance .

IV. Products and Trading Mechanisms

• Product range : stocks, ETFs, bonds, derivatives (stock index futures), Islamic financial products (Sukuk).

• Trading mechanism : order-driven system, settlement cycle T+2.

• Innovative measures :

• In 2022, IDX Co-Location Service was launched to provide server hosting for high-frequency trading.

• Actively promote the Islamic capital market and become one of the world's leading Sukuk markets.

5. Recent Performance and Market Trends

• IPO Activity : IDX is one of the most active IPO markets in the world . In 2023, a total of 79 companies went public , surpassing Hong Kong and Singapore.

• Unicorn IPO : Indonesian tech giant GoTo (a merger of Gojek and Tokopedia) has been listed on the IDX, attracting a large number of domestic and foreign investors.

• Capital Flow : Due to the impact of global tightening in 2024, the net outflow of foreign capital increased for a time, but the number of domestic investors made up for it significantly, supporting market stability.

VI. Advantages and Disadvantages

Advantages

• Southeast Asia's fastest-growing capital market, with the highest number of IPOs globally.

• The investor structure is younger, local funds are active, and liquidity is enhanced.

• Local tech unicorns (GoTo, Bukalapak) were listed on the IDX, driving market attention.

insufficient

• The proportion of foreign investment has declined and the degree of internationalization is limited.

• The level of corporate governance and information disclosure is still lower than that of mature markets.

• The market weight relies on banks, energy and commodity companies, and the ability to resist risks is insufficient.

7. Investor and Media Comments

• Local investors : IDX is generally recognized as an important platform for wealth appreciation and entrepreneurial financing.

• International media : They are generally concerned about its IPO potential , but also question its corporate governance and insufficient foreign investment .

• Indexed by third-party platforms : It is usually only included as a "regional market index reference" on ForexEye and Forex110 , but is fully included on authoritative financial data platforms such as Bloomberg, Refinitiv, and FTSE.

8. Authoritative Rating (10-point scale)

• Supervision and Compliance : 7/10 (The system is gradually improving, but the transparency is slightly low)

• Market size : 8/10 (second in market capitalization in ASEAN, after SGX)

• Product diversity : 7/10 (mainly stocks, derivatives are not yet mature)

• Degree of internationalization : 6/10 (declining foreign investment, with domestic capital dominating)

• Growth Potential : 9/10 (World leader in IPOs, with emerging tech stocks driving the future)

Overall rating : 7.4/10

IX. Conclusion

The Indonesia Stock Exchange (IDX) is Southeast Asia's most promising securities market , particularly in IPOs and local technology companies. It provides a platform for young investors and emerging companies , but still needs to catch up with the SGX and the Hong Kong Stock Exchange in terms of regulatory transparency and internationalization .

Suitable for :

• Investors who value high-growth and emerging market opportunities .

• We are interested in participating in Southeast Asian technology unicorns and consumer upgrade-focused funds.

• Medium to long-term investors with high risk tolerance.