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EV ambition to boost Indonesia equity market in 2023: JP Morgan
JP Morgan expects the electric vehicle (EV) industry and its supply chain to buoy Indonesia's equity market.
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A sign outside the headquarters of JP Morgan Chase & Co in New York, the United States, Sept. 19, 2013. (Reuters/Mike Segar)
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ndonesia’s electric vehicle (EV) ambition is expected to buoy the country’s equity market this year, JP Morgan said on Wednesday, providing additional support amid looming global uncertainties and lower commodity price.
The lender put an overweight rating on Indonesia’s material producers, as the country is the world’s biggest producer of nickel, a metal extensively used in the production of EVs.
An overweight refers to a prediction that stocks in the particular industry will see higher price increase compared to other industries.
The push from the EV supply chain industry will add up the strength from the country’s resilient domestic consumption and strong fundamentals in corporate earnings, the bank said. Combined with several other factors, it expects the IDX composite to reach 7,500 by the end of 2023.
“Three years ago, we were just talking about nickel mining, but in the past year we have been talking about nickel processing into batteries. From this point onward, the discussion will revolve around manufacturing [EVs] in Indonesia,” head of Research and Strategy JP Morgan Indonesia Henry Wibowo told reporters during a media briefing.
Read also: Only fraction of motorbikes in Indonesia to be EVs by 2030
The Indonesian government has been pushing the EV industry downstream within the past years with the idea of creating an end-to-end ecosystem from the upstream, such as mining and base metal industries to finished products for electric four-wheelers and two-wheelers.
