Finding value in the stock market often means looking for companies that the market has temporarily overlooked despite their strong fundamentals. In the context of the Indonesia Stock Exchange (IDX) in 2025, several "blue-chip" and mid-cap stocks are trading at valuations significantly lower than their historical averages or intrinsic values.
Here is a comprehensive look at the top undervalued stocks in Indonesia for 2025, categorized by sector and valuation metrics.
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| Here is a comprehensive look at the top undervalued stocks in Indonesia for 2025, categorized by sector and valuation metrics |
1. The Banking Sector: Value in Stability
Indonesian banks are known for their high profitability (ROE) and robust dividends. While some have reached all-time highs, a few remain attractively priced relative to their long-term growth potential.
Bank Negara Indonesia (BBNI): Often trading at a lower Price-to-Book Value (PBV) compared to its peers like BBCA or BMRI, BBNI is undergoing a digital transformation that analysts believe will expand its margins.
Bank Rakyat Indonesia (BBRI): Despite being a giant in micro-finance, BBRI has faced periods of price correction in 2025 due to concerns over credit quality in the SME sector, making its current entry point attractive for long-term holders seeking a high dividend yield.
2. The Energy & Commodity Sector: Cash-Rich Giants
Many Indonesian energy companies are trading at low Price-to-Earnings (PER) ratios because the market views them as cyclical. However, their massive cash reserves and diversification into "green energy" offer hidden value.
Adaro Energy Indonesia (ADRO): With a PBV often below $1.0$ and a very low PER, Adaro remains a value play. The company is aggressively shifting toward mineral processing and hydro-power, which could lead to a valuation re-rating.
United Tractors (UNTR): As a subsidiary of Astra, UNTR benefits from the mining boom. It currently trades at a valuation that many analysts consider "cheap" given its strong balance sheet and expansion into gold and nickel mining.
3. The Consumer & Infrastructure Sector: Recovery Plays
As domestic consumption stabilizes in 2025, these companies are well-positioned to benefit from a rebound in purchasing power.
Astra International (ASII): A true "proxy" for the Indonesian economy. ASII has faced pressure from the rise of electric vehicles (EVs), but its diversified business model (finance, mining, and agribusiness) makes it a classic undervalued blue chip.
Telkom Indonesia (TLKM): The telecommunications giant has seen its stock price suppressed due to intense competition. However, its "InfraCo" and "Data Center" initiatives provide a long-term growth narrative that is not yet fully reflected in its current price.
Indofood Sukses Makmur (INDF): The parent company of ICBP often trades at a significant discount to its subsidiary. Investors buying INDF essentially get the noodles business (ICBP) plus a massive agribusiness and distribution network at a bargain.
Key Valuation Metrics (Estimated 2025)
| Stock Code | Sector | PBV (Ratio) | PER (Ratio) | Dividend Yield |
| BBNI | Banking | ~1.2x | ~8.5x | 4.5% |
| ADRO | Energy | ~0.7x | ~4.2x | >10% |
| ASII | Automotive | ~0.9x | ~6.5x | 6.2% |
| TLKM | Telecom | ~2.1x | ~12.5x | 5.0% |
| UNTR | Heavy Eqp. | ~1.0x | ~5.5x | 7.0% |
How to Identify Undervalued Stocks
When hunting for value in Indonesia, look for the following "Value Indicators":
PBV < 1.0: The stock is trading for less than the value of its net assets.
Historical PER: Compare the current PER to the 5-year average. If the current PER is significantly lower, it might be undervalued.
High Dividend Yield: A high yield often acts as a "safety net" for the stock price.
Earnings Growth: Ensure the "cheapness" isn't due to a permanent decline in business (avoiding the "Value Trap").
Note: Investing in undervalued stocks requires patience. The market may take months or even years to recognize the "true value" of a company. Always conduct your own due diligence before making an investment.