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This does not sound like a question a day trader would ask. Therefore i'm going to assume that you're a value investor and are planning to hold on to your stocks until the foreseeable future like Warren Buffet did with his Coca Cola stocks. To quote the man:"Only buy something that you'd be perfectly happy to hold if the market shut down for 10 years." - Warren BuffetIn Indonesia, there are two industries that i am betting on: Construction & Consumer GoodsMy choice is largely based on Mckinsey's report and forecasts on Indonesia's economy: The archipelago economy: Unleashing Indonesia's Potential [1]. You can read the full report by downloading the pdf from the link below. However i am going to summarize the key points.By 2030, Indonesia will potentially...Become the 7th largest economy in the world. (Currently 16th)Have 135 million members of the consuming class. (Currently 45 million)Have 71% of the population in cities producing 86% of GDP. (Currently 53% of the population are in cities producing 74% of GDP)Have 113 million skilled workers in the economy. Note: Hard to estimate (Currently 55 million skilled workers in the economy)Have $1.8 Trillion in market opportunities across all sectors (Currently $0.5 Trillion)With this information, using logic and a bit of imagination, you can probably already predict which Industry is going to prosper in the next few years on your own. So we're going to discuss two of my choices, which is Construction & Consumer Goods. To select the individual stocks, we are going to follow more Warren Buffet wisdom:"It's far better to buy a wonderful company at a fair price, than a fair company at a wonderful price."Before we go any further, it is important to be familiar with some basic financial ratios to evaluate the overall health and performance of the company. As you become more financially literate, you would probably utilize other more complex ratios for your analysis. However these 4 very basic ratios should give you a relatively solid understanding on the current status of the company.1) Price-Earnings Ratio (P/E Ratio) - Price/Earnings per Share - This ratio shows the price you are paying for every unit of profit the company is making. Its a ratio that gives a highly simplified indication whether you are overpaying or underpaying for a company's stock. A stock that is overpriced would have a high P/E ratio as it requires you pay more for a single unit of profit. While an underpriced stock would have a lower P/E ratio for the same reasons. However, it is very important to understand that many investors would still invest in companies with high P/E ratios if they predict that the company would significantly boost its earnings in the near future.2) Return on Equity - Net Earnings/Total Equity - Return on Equity is a ratio that reveals how good the company is at generating profits with the level of equity that they work with. The higher the ROE, the better the company is at generating profits. (Recommendation: 10% - 15% is often cited as a decent return.)3) Quick Ratio - (Current Assets-Inventories)/Current Liabilities - This ratio shows how well the company is able to pay off its short term (in the next year) loans and obligations with their current assets. Inventory on the other hand, takes time to sell and convert into cash, therefore needs to be taken out of the equation. (Recommendation: Companies should aim to have a 1:1 ratio here to prevent defaulting on their loans in the near future.)4) Debt to Equity Ratio - Total Debt/Total Equity - This ratio shows how much of the company's operations are funded by debt and libilities. There is a certain limit of debts a company can take before they become a highly risky investment. Companies that leverage too much may risk hurting its future earnings. (Recommendation: Any number above 2.0 indicates that the company is financed mostly by liabilities than equity which usually isnt a good sign for the more conservative investors.)Note: Different industries will have distinct standards in financial ratios due to the various business models, market mechanisms and the overall dynamic of the industries. For example, the Banking industry would naturally carry a higher debt load than other industries. This is just a simplified universally accepted benchmark to give an example to the readers.CONSTRUCTIONThe current Government's economic policy is heavily focused on infrastructure development in Indonesia's less prosperous regions. The goal is to boost economic activity throughout the whole of Indonesia. Construction companies will therefore blossom in the next few years as they will have to meet the needs of all these developments. This is not new throughout the world, China's massive growth and infrastructure development in the last few decades gave birth to some of the largest construction companies in the world. In keeping with Warren Buffet's advice to only purchase wonderful companies, we should be looking at one of the market leaders.PT Waskita Karya Tbk (WSKT) is Indonesia's largest state owned construction company. It engages in a wide range of construction activities including highways, bridges and ports. The company has also recently expanded their target market to foreign countries.Being a state owned enterprise, PT Waskita Karya is well positioned to acquire large construction projects that the Indonesian Government has targeted as part of its economic policy. This represents a sort of guarantee of its growth and significance in the next few years. Additionally, Indonesia's rapid growth in recent years has resulted in simultaneous growth in the private sector as well which PT Waskita Karya could expand to. Their revenues and profits have been consistently growing since its IPO in 2012, not a single year has it declined, and forecasts have indicated that this is just the start as the company's rapid growth are still ahead of it. Trimegah securities has forecasted that revenues would double by 2018 [3].After researching on the forecasts of the company, and determining whether it has a bright future, we should then apply the financial ratios to confirm whether their stock is a good pick.As of August 17, 2016 - Stock Price: IDR2,800 per shareP/E Ratio: 22.38 ~ A decently priced stock if its trading at IDR2,800 per share. However with the highly favorable forecasts on its growth and future earnings, this stock will definitely be worth the investment for value investors. If you are trading at large volumes, you might want to wait till the stock price fall slightly as it ended the day surging by IDR110 today.Return on Equity: 17.20% ~ Solid return for investors.Quick Ratio: 1.02 ~ Slightly above the preferred benchmark but by a very small margin. The company can confidently meet its short term obligations.Debt to Equity: 1.67 ~ A healthy debt and equity ratio.CONSUMER GOODSWith massive developments, comes income and with income, comes spending. Mckinsey reports that Indonesia's consuming middle class will pretty much triple in the next decade or so. These means a huge jump in the demand for consumer goods.One of the largest consumer goods producers, its safe to say that PT Unilever Indonesia Tbk (UNVR) wont be leaving this market anytime soon. Unilever would definitely be one of the companies that would largely benefit from Indonesia's rapidly growing middle class in the next few years. Their wide range of products are consumed by the majority of Indonesians, just take a look at the picture below.These are just a fraction of their whole product portfolio. Notably missing are Sari Wangi and Kecap Bango. Their wide range of product catalogue, along with their international standards pretty much makes them resistant to market volatilities, making this an extremely safe investment. Looking at their forecasts, the data also seems to be in line with our prediction for rapid growth [4].As of August 17, 2016 - Stock Price: IDR45,350 per shareP/E Ratio: 55.63 ~ Expensive? Definitely, but as a value investor, this is a must have as the price of this stock is almost guaranteed to continuously go up.Return on Equity: 131.62% ~ As their product is consumed by all, profits would most certainly be high resulting in great returns for investors.Quick Ratio: 0.518 ~ No problem at all in paying its short term liabilities.Debt to Equity: 0.143 ~ It seems that Unilever is very resistant to the idea of debt, unless it is necessary, which is always good news for investors.I think what you should be taking from this answer is not that Waskita Karya and Unilever Indonesia are the best stocks to invest in 2016. The reality is there is no such thing as best stock. I can guarantee you, there are many stocks out there that would be a greater bargain, many stocks out there will also generate you bigger returns. It all comes down to determining your own investment style, whether youre a more risk taking investor or risk averse, how long are you planning to keep and sell your stocks, the possibilities are endless. I am merely showing you my own thought process when picking stocks which you can draw inspiration and learn from. You should be doing your own research and continuously learn new things everyday to enrich your wisdom. Thats what value investing is about. To summarize im going to quote Warren Buffet again (last one, i promise :)“The most important investment you can make is in yourself.”Best of luck!ADDITIONAL READING[1]. The archipelago economy: Unleashing Indonesia's Potential (pdf) https://www.google.co.id/url?sa=t&source=web&rct=j&url=http://www.mckinsey.com/~/media/McKinsey/Global%2520Themes/Asia%2520Pacific/The%2520archipelago%2520economy/MGI_Unleashing_Indonesia_potential_Executive_Summary.ashx&ved=0ahUKEwi4n4jq2sfOAhWKv48KHUAQCEkQFggaMAE&usg=AFQjCNFH4gfYhASy_vcw_6C9G6S9jjDlTg&sig2=LGoxKiyfksuWrhnWRDvdYQ[2]. I have written an extensive report on the current Government's economic policies. I suggest people who want to learn more on the current conditions of our economy and where its heading take a look in order to get a more clear understanding of our economic future. Itll help in your investment decision making :)Indonesia: What do you think about President Jokowi's overall economic policy? by Adrian Muhammad Adrian Muhammad's answer to Indonesia: What do you think about President Jokowi's overall economic policy?REFERENCES[3].Waskita Karya | Indonesia Investments[4].Unilever Indonesia