Jakarta, World’s Densest City: Why It Matters for Investors

Jakarta has earned a new title as the world’s most densely populated city in the World Urbanization Prospects 2025 published by the United Nations Department of Economic and Social Affairs (UN DESA). With an estimated population of nearly 42 million, the report goes beyond headline statistics and carries strategic implications for Indonesia’s economy.

For investors, Jakarta functions as a massive growth engine that rapidly absorbs innovation while creating a consistent demand cycle. Household consumption continues to support multiple sectors. This “most densely populated city” status reshapes long-term demand assumptions, investment strategies, and expansion plans for many listed companies, particularly those with a strong presence in Jakarta.

Megacity Urban Structure

Over time, Jakarta has developed a highly concentrated economic and urban structure. Population density makes infrastructure investment and distribution networks more efficient due to high utilization rates and relatively permanent demand. The concentration of labor, consumers, and businesses also accelerates the adoption of new services. For listed companies, Jakarta provides a stable market base—albeit accompanied by cost pressures and intense competition that require strong operational execution.

Sustained urbanization drives substantial demand for mass transportation, toll roads, electricity, clean water, waste management, and digital connectivity. The biggest investment opportunities lie with owners of strategic, high-throughput assets rather than contractors alone. Companies such as JSMR, TLKM, TOWR, PGAS, as well as ISAT or EXCL, stand to benefit from the infrastructure and utilities super-cycle across Greater Jakarta. Meanwhile, firms like PTPP and ADHI gain exposure through construction and transport-integration projects.

In the property sector, density fuels vertical development and transit-oriented projects, even as political functions shift to the new capital, Nusantara. Vertical housing, mixed-use developments, and mini-CBDs along commuter rail, MRT, and LRT corridors are positioned as long-term winners. Grade A office space remains relevant, although growth is increasingly shifting toward SOHO (Small Office/Home Office) formats. Developers such as BSDE, CTRA, SMRA, and PWON are well placed to capture these trends through integrated developments, while DIRE/DINFRA instruments offer attractive alternatives for portfolio diversification.

Jakarta as the Benchmark

The “most densely populated city” status reinforces a simple principle: if a listed company struggles to compete in Jakarta, its national growth narrative deserves closer scrutiny. The fiercest competition, highest costs, and most demanding consumers are found in Jakarta. Companies that can operate efficiently here are generally better prepared to expand into other cities.

With its massive population, Jakarta serves as the primary demand center for sectors such as FMCG, modern retail, ride-hailing, logistics, digital payments, financing, healthcare, and education. It also sets pricing and market benchmarks—from property rents and wage levels to premium services. What succeeds in Jakarta often becomes the reference point for other cities across Indonesia.

Jakarta is also the main battleground for market share. Even small gains in Jakarta can have a greater impact than larger gains elsewhere. Companies with store networks near public transport hubs, reliable last-mile delivery capabilities, and integrated online–offline channels tend to hold a structural advantage. Investors may monitor straightforward indicators such as sales growth in Greater Jakarta, dark store expansion, and the use of customer data for more targeted marketing.

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Disclaimer: The content is made for educational purposes, not a recommendation to buy or sell a particular stock. PT KAF Sekuritas Indonesia is licensed and supervised by the Financial Services Authority (OJK).

Which other sectors do you think could grow as Jakarta’s population and economic activity continue to increase?

• Consumer Goods
• Healthcare
• Financial
• Technology

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