MNCS Morning Navigator 08 December 2020

Global Market Highlight

DJIA lowered by -0.49% on Monday (07/12) followed by S&P 500 (-0.19%) while Nasdaq rose by +0.45%. The global stock market rally days finally stopped due to profit taking by investors. Stimulus talks that have yet to find a bright spot and the growing number of Covid-19 patients are adding to the pressure on the stock market. In fact, the debate between the congress and parliament regarding government spending continues today. On the other hand, the US Food and Drug Administration (FDA) began considering granting vaccine use licenses at the end of this week. FDA advisors will discuss with the Pfizer Group on Thursday as well as conduct a vaccine review. Moreover, the market will look forward to several data releases today, such as: 1) Eurozone GDP growth Rate 3Q20 Estimate; 2) Germany ZEW Economic Sentiment Index; 3) Japan GDP Growth Annualized Final.

Domestic Update

• The Indonesia’s foreign exchange reserve recorded to be USD133.6 billion at the end of November 2020, relatively same with the previous month (USD133.7 billion). This reserve position was equivalent to the finance of 9.9 months imports or 9.5 months of imports and government debt repayments with also being well above the international standards of reserves adequacy at 3 months of imports. The development of the reserve position was primarily attributable to the withdrawal of government foreign loans, tax receipts and oil and gas foreign exchange, as well as expenditures for the payment of government foreign debt (Bank Indonesia).
• Furthermore, there is an additional of 1.466 new Covid-19 cases in Jakarta yesterday.

Company News

1.        ACES IJ officially open a new store at Living Plaza Manado. This store is the 14th store opened this year and will become the 208th store in Indonesia. For information, the store has an area of about 2,100sqm. (Market Bisnis). MNCS Comment: We believe ACES will achieve its target as management plans to open 15 stores located in Java and outside Java. Altough the 3Q20 performance slightly below our estimate due to unexpected PSBB thightening in Sep-20, we expect the SSSG will gradually improved in 4Q20. ACES is currently traded at  39.58x/5.77x PE/PBV.
2.        TOWR IJ announced to distribute interim dividends of IDR300.6 billion for 50.1 billion shares of the company. Dividend per share is IDR6 with dividend yield of 0.57%. The cum date will be at 14 December 2020 (Kontan). MNCS Comment: TOWR's interim dividend remains the same as last year as a reminder of the resilient performance during the pandemic season. TOWR is currently traded at 21.15x/5.56x PE/PBV.
3.        GEMS IJ announced to distribute interim dividends of IDR283.54 billion for 5.88 billion shares of the company. Dividend per share is IDR48.2 with dividend yield of 1.89%. The cum date is at 11 December 2020 (Kontan). MNCS Comment: Although suspended, GEMS managed to booked a better performance while continue to distribute dividend. GEMS is currently traded 9.80x/2.56x PE/PBV.

IHSG Updates

JCI went up by +2.07% to 5,930.76 on Monday (07/12) followed by net foreign buy reaching IDR432.83 billion. JCI return to rise supported by the news of the 1.2 million dose of vaccine arrival, boosting the pharmaceutical stocks, while 1.8 million doses are expected to arrived in January. Furthermore, around 45 million doses of raw vaccine materials will be received and developed by Bio Pharma. Meanwhile, the Rupiah exchange rate was flat IDR14,105. We estimate JCI will move in the range of 5,563 – 5,960 while waiting for consumer confidence data release. Today's recommendation: ACES, JPFA, TLKM, DMAS.

Corporate Action

IPO: PTDU

Reverse Stock Cum Date: BEKS (10:1)

Disclaimer On

ACES, JPFA, TLKM, DMAS, TOWR, GEMS