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• Syailendra Capital Targets Assets Under Management Growth of 30% in 2019

Syailendra Capital Targets Assets Under Management Growth of 30% in 2019

June 27, 2019

The mutual fund industry experienced renewed growth in 2018. As of early December, the mutual fund industry reached Rp500 trillion, growing approximately 10% from the end of 2017 position of Rp456 trillion. In line with this, President Director of PT Syailendra Capital, Fajar R Hidajat, stated that the company's Assets Under Management (AUM) as at 19 December 2018 also increased significantly, rising 101% from Rp10,043 trillion (year-end 2017 position) to Rp20,249 trillion. Consequently, the company's industry ranking broke into the top 10, positioning it at 8th place among investment managers with the largest assets under management for Open-Ended Mutual Funds (excluding KPD and RDPT).

In 2018, the company launched 11 new products, with the flagship new investment product being an Index Fund named Syailendra MSCI Value Index Fund, which was launched on 8 June 2018. According to Fajar, this index mutual fund is the only product in Indonesia that is benchmarked against the MSCI Value Index. MSCI Ltd itself is a market leader in index provision services. As of 14 December 2018, Syailendra MSCI Value Index Fund had delivered significant returns of 11.19% since launch. This growth represents the highest return among other index mutual funds currently available in the market. As at 14 December 2018, the fund's AUM stood at Rp154 million.

The company also reported positive developments in its 2018 expansion efforts to broaden its distribution and marketing network. The initial phase of the company's distribution network expansion (specifically for the retail market) showed very satisfactory results. Through partnerships with one of Indonesia's largest e-commerce platforms, Tokopedia, and Bareksa, one of Indonesia's largest online mutual fund marketplaces, the company successfully introduced its Money Market Fund, Syailendra Dana Kas. To date, investors on Tokopedia Reksa Dana have grown 20-fold since its launch in March 2018.

Tokopedia's Head of Fintech, Samuel Sentana, expressed satisfaction with the progress of the Tokopedia Reksa Dana partnership with Syailendra, stating "The strong growth in the number of Tokopedia Reksa Dana investors demonstrates that public awareness of the importance of investment is building. Through our partnership with Syailendra, Tokopedia aims to continue making it easier for the public to invest, even with just Rp10,000."

Following significant growth in assets under management in 2018, PT Syailendra Capital remains optimistic in 2019, despite 2019 being a general election year. The company targets assets under management growth of 30% to approximately Rp27 trillion. This growth is targeted through innovation in both new investment products and marketing distribution networks, particularly in the retail marketing channel. This will be accomplished by continuing to develop partnerships through Tokopedia-Bareksa and also through retail distribution networks via a digital platform to be introduced to the public in the second half of 2019.

Fajar further noted that the strong interest in Tokopedia-Bareksa for mutual funds provides valid reason for Syailendra to promote investor education for beginners. Syailendra is preparing an educational programme specifically designed with various case studies relevant to the diverse financial experiences of the public. This programme is in the finalisation stage and will be launched in 2019.

At the same event, PT Syailendra Capital's Chief Investment Officer (CIO), Ahmad Solihin, also presented the market outlook for the end of 2018 and for 2019. Regarding capital market movements at the end of 2018, although markets remained volatile, improvement was beginning to appear, starting with a reversal in USD direction. Ahmad Solihin stated, "The USD tends to weaken and capital flows are beginning to reverse back to emerging markets. However, we still see the need for caution in investing."

In 2018, volatility in Indonesia and emerging markets (EM) generally resulted from the US-China trade war, economic and political risks in Argentina and Turkey, and US fiscal policy relaxation.

For 2019, volatility is predicted to persist, although not to the level seen last year. The trade war issue is gradually finding common ground with news of US and China returning to the negotiating table. Additionally, investor positioning in emerging markets is already relatively much smaller, so further declines would also be more limited. Oil prices, tending to remain stable below $70, would be more favourable for the Indonesian economy, which is a net oil importer.