Global Market Highlight
DJIA slipped by -0.46% on Tuesday (02/03) followed by S&P 500 (-0.81%) and Nasdaq (-1.69%). Wall Wall Street tumbled as investors weighed up weakness in tech. Energy fell as oil prices settled lower amid tensions between Saudi and Russia over production. On the stimulus front, the Senate insists that the Democrats will have the votes needed to pass the bill. Moreover, the market will look forward to several data releases today, such as: 1) US Markit Composite PMI Final; 2) US MBA Mortgage Applications; 3) Italy GDP Growth Rate.
Domestic Update
• The Minister of Finance has released requirements for untaxed dividends. This aims to encourage investment in financial markets and the real sector. The exemption from the PPh object applies to dividends originating from within the country received by individual taxpayers.
• Furthermore, there was an addition of 578 new Covid-19 cases in Jakarta yesterday.
Company News
1. ELSA IJ posted operating revenues of IDR7.7 trillion in FY20. The contribution of operating revenues came from the upstream oil and gas services segment with 53%, energy distribution & logistics services at 43%, and supporting services for 4%. ELSA recorded a net profit of IDR249 billion in FY20 (IQ Plus). MNCS Comment: ELSA was able to maintain its financial performance driven by several successful projects such as 3D seismic surveys in the Jambi Merang, Tuban, and Batuk Utak areas. Currently ELSA is trading at 11.47x/0.78x PE/PBV.
2. SIMP IJ recorded a 6% YoY increase in sales to IDR14.48 trillion in FY20. Gross profit was recorded at IDR3.01 trillion or +44% YoY. SIMP recorded profit for the year attributable to owners of the parent entity amounting to IDR234.28 billion (vs loss of IDR546.14 billion FY19). Meanwhile, EBITDA of IDR3.15 trillion rose 66% YoY (Emitennews). MNCS Comment: SIMP is benefitted from the increase on CPO price and will continue to remain in advantage as CPO price is still on the hike until 1H21. SIMP is currently trading at 31.19x/0.49x PE/PBV.
3. WSKT IJ is in the middle of a tender process worth IDR7 trillion - IDR8 trillion from projects that have been auctioned off by the government. WSKT is targeting winning costs around 35% - 40% of the project. In addition, WSKT also targets several projects from abroad, namely the Philippines, Saudi Arabia, and several countries in Africa which are still in the discussion stage for the financial capabilities of both parties (Bisnis Indonesia). MNCS Comment: WSKT steps in conducting tenders from the government are good plus the target to overseas tenders, which if achieved will make it easier for WSKT to realize the new FY21E contract target of IDR26 trillion. WSKT is trading at 1.52x PBV.
IHSG Updates
JCI rose by +0.33% to 6,359.21 on Tuesday (02/03) followed by net foreign buy reaching IDR29.89 billion. JCI continued to rally with the significant strengthening of consumer and basic industry by more than 2%, however the mining sector weakened. Meanwhile, the Rupiah exchange rate was weakening at IDR14,325. We estimate JCI will move in the range of 6,173-6,505 while waiting for foreign exchange reserve data release. Today's recommendation: WIKA, ISAT, DOID, ELSA.
Corporate Action
RUPS: ERAA, JGLE
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