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ACCORDING to a study conducted by Colliers Indonesia in April 2025, the government’s policy on budget efficiency had a substantial impact on the performance of the hospitality industry. In the same month, the survey of the Indonesian Hotel and Restaurant Association (PHRI) also recorded a 96.7% decrease in dwellings at hotels in Jakarta.
Liza Camelia Suryanata, Head of Research at Kiwoom Sekuritas, has stated that the government’s efficiency in allocating financial resources has had a substantial impact on the performance of hospitality sector issuers this year.
“This is due to significant budget reductions related to official meetings, official travel, and events, resulting in a decline in demand and revenue for this sector,” Liza stated in her research on Thursday (06/5), 2025
According to Liza, the most vulnerable issuers to this pressure are heavily reliant on income from MICE (meeting, incentive, convention, and exhibition) and depend on booking through online travel agencies (OTAs).
This category includes issuers such as Eastparc Hotel (East), Sahid Jaya International Hotel (SHID), and Red Planet Indonesia (PSKT). Conversely, issuers such as Indonesian Paradise Property (INPP) and Uluwatu Villa (Buva) hill, which are not dependent on government segments and have robust F&B pillars, remain viable options.
Liza suggested that investors begin to focus on sectors that have positive structural catalysts and more sustainable growth prospects. She has identified several sectors that show promise, including healthcare, digital infrastructure, and logistics.
“For the majority of issuers related to hotels, the potential has become uninteresting, as have the profiles of risks. Therefore, investors should consider transitioning to other sectors for a period,” she concluded. [kontan.id/photo special]
