New Fund: OSK Indonesia Equity Growth Fund

To join in the Indonesia Theme bandwagon, OSK launched its own version of Indonesian Equity Growth Fund, which aims to achieve medium to long term capital appreciation through investments in securities of companies with high growth potential that are listed on the Indonesian Stock Exchange and/or companies listed on other exchanges whose business are substantially in Indonesia.


This fund is suitable for investors who:
  • wish to participate in the potential and investment opportunities of the Indonesian economy
  • are willing to accept higher risk in their investments in order to achieve potentially higher returns in the medium to long term
  • seek capital appreciation rather than income
8 Answers to "WHY invest in Indonesia?"
  1. Impressive equity market performance
    • Jakarta Composite Index gained 46% in 2010
    • The 7th year in which Indonesia has outperformed Asia ex-Japan over the past 9 years (Source: CLSA Research January 2011)
  2. Strong economic growth
    • Expected growth of 5.7% to 6% in year 2011
    • Growth is driven by domestic consumption, currently stands at about 65% of Indonesia GDP
  3. Favorable demographics
    • 4th largest population in the world
    • Middle and upper-middle class households is expected to increase from 29% currently to 41% by 2012
  4. Resources rich
    • World's biggest CPO producer
    • World's biggest Thermal Coal exporter
    • World's biggest Tin exporter
  5. Government projects and infrastructure development
    • 2011 budget is pro spending, especially in infrastructure development
    • Development expenditure expected to increase 29% in 2011
  6. Equity market remains attractive
    • Currently trading on 13x PE with 22% earnings growth and 25% ROE
    • Indonesia has the 2nd lowest Equity Market Cap / Nominal GDP ratio in the region
  7. Outlook on Rupiah to strengthen
    • Lagged regional currencies in the past 10 years
    • Improving outlook for Rupiah makes Indonesia attractive to foreign investors
Investment Approach
  1. Combination of "top-down" and "bottom-up" approach
    • An investment strategy that is not mutually exclusive but closely inter-twined between asset allocation and stock specific selection
  2. Value driven approach
    • Stocks are then selected for their value
  3. Emphasis on growth
    • Stocks are further selected for their growth potential
Investment Approach
Portfolio Strategy
OSK sees several investment opportunities including
  1. Banks
    • Strong loan growth (+25%) driving revenues
    • Low penetration of key financial services and credit
  2. Infrastructure
    • Total investment needed for infrastructure projects 2010 - 2014 will reach USD34.14 billion
  3. Commodities
    • Medium term outlook for thermal coal positive due to increasing demand from China, India and Indonesia
  4. Consumption
    • Low consumption in categories such as cars, motorcycles, cellular phones and cement

Source: OSK-UOB unit trust management berhad

Click here to read the prospectus

Comments

Post a Comment

Popular posts from this blog

Exclusive Interview: 2011 8TV Hot Chef (美食型男) Jason Cha

Image
Dubbed as one of the most handsome guy among the participants of popular 8TV shows Hot Chef ( 美食型男 ), Jason emerged as the ultimate winner, not by his look, but his cooking skills. Since then, he became a familiar face in Malaysia. Did you recognize Jason shopping at Mid Valley lately? In order for us to understand more about him, below are some of the his personal details: Full Name            : Cha Kian Heng Age                      : 34 Hometown           : Ipoh, Perak Status                  : Married Hobby                  : Collecting Thai Amulets Favourite Foods : Italian Pizza with many many cheese Favourite Sports : Badminton Favourite Sportsman : Fernando Torres (football player of Spain and Chelsea currently) The Interview: Q: What makes you decided to join the 8TV's 2011 Hot Ch...
Read more

Career Lessons from Breaking Bad

Image
AMC's Breaking Bad ended with a bang last Sunday, leaving viewers generally content and definitely shell shocked. Though the ride is over, we can finally look back at the series and reflect on how we can learn from both Heisenberg's victories and mistakes. How can a meth kingpin help you and your future careers? Here are some takeaways : 1. Be hard to replace   : Find a specific skill set and make sure you are good enough that nobody can quickly take your place. Whether it be modeling, analysis, writing, communication, or even a certain product with a 99.1% purity, having a specific niche or strength can ensure job security. Just try not to kill fellow associates to eliminate competition. 2. Associate with the right people : If you are the smartest person in the room, you're in the wrong room. Surround yourself with people who you believe can bring out the best in you. Doing business with a high school dropout and drug addict will certainly lead to complications in the fut...
Read more

Things We Now Know

The poor are losing ground in the new Obama world.  The facts are showing up even in the halls of collectivist extremes like the New York Times.  The rich are getting richer and poor are being locked in place.  Big government is throttling the economy and the hopes and dreams of lower and middle class Americans. Today's Wall Street Journal's article by Simon Constable lays out some of the simple and obvious facts of the Obama era: "The richest 20% of households account for 38% of spending, according to government data for 2011, the latest available.  Compare that with 2003 when the top earners spent 26% of the total."  The article goes on to say..."it could get even worse."  It will. Who really benefits when the regulators strangle the banks?  Do banks really need to get much more conservative in their lending practices?  Why does the government know best?  How far can you stretch the FDIC guarantees before American banking is simply a subsid...
Read more