Company Update

20 Februari 2024

BRIS IJ - MNC Sekuritas Equity Report February 20, 2024

Paving the Path to New Heights

Key Takeaways :

▪️BRIS's YTD 2024 performance has been impressive, with its share price rallied +42% YTD, driven by a substantial 69% increase in avg. transaction volume and a doubling of transaction value compared to 2023. Notably, net foreign inflow reached IDR564bn in Jan-Feb 2024 (vs IDR125bn in 4Q23), especially post the release of the strong FY23 financial report.

▪️To bolster its IT security system, BRIS is gearing up for a capex of IDR1.5tn, marking a substantial increase from previous years' budgets which primarily designated for 4-key areas, including security measures & infrastructure enhancements.

▪️Management set its NIM guidance to 5.50%-5.86% for FY24E. The bank remained optimistic that financing growth would achieve 15% YoY in FY24E (vs 15.7% in FY23) and third party fund to stay moderate at 8.5%-10.0% (vs 12.4% in FY23). Management also target NPF to stay below 2% in FY24 and cash coverage ~200%. Hence, the NPAT is targeted at IDR6.3-6.5tn in FY24E.

▪️We maintain our BUY rating with higher TP of IDR2,750/share implying 2.9x of FY24F PBV. Strong earnings growth momentum should continue in FY24E as financing could accelerated coupled with sustain cost of fund. Downside risks to our call include slower than expected loan growth and asset quality deterioration.

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