Global Market Highlight
DJIA slipped by -0.48% on Wednesday (19/05) followed by S&P 500 (-0.29%) and Nasdaq (-0.03%). Wall Street still weakened with concerns the Fed is starting to think about broaching the bond tapering topic at upcoming meetings. If the economy continued to make rapid progress, it might be appropriate at some point to begin discussing a plan for adjusting the pace of asset purchase. This sentiment has triggered the sell as the US government bond yields jumped. Moreover, the market will look forward to several data releases today, such as: 1) US FOMC Minutes; 2) US Initial Jobless Claims; 3) Germany Purchasing Price Index.
Domestic Update
• The government predicts that the economy in 2Q21 will grow in the range of 7%. This is driven by various PEN stimulus, given the several policies that have been implemented and the money in circulation (Kontan).
• Coordinating Minister for Economic Affairs Airlangga Hartarto also stated that there was a significant increase in car sales in April 2021, up 227% YoY. This was supported by PPnBM incentives and until 11 May 2021 the realization of the use of PPnBM DTP incentives in the national economic recovery program which was recorded as new. around IDR90 billion. This figure is equivalent to 2.6% of the ceiling which reached IDR 3.46 trillion (Kontan).
• The government will change the personal income tax rate (PPh) with the following conditions: 1) Taxable income of up to IDR50 million in one year, the PPh is 5%; 2) above IDR50 million to IDR250 million at 15%; 3) over IDR250 million to IDR500 million by 25%; 4) taxable income above IDR500 million in tariffs, the income tax is worth 30% (Kontan).
• Furthermore, there was an addition of 539 new Covid-19 cases in Jakarta yesterday.
Company News
1. MDKA IJ posted revenue of USD46.54 million in 1Q21, which decreased 55.15% YoY (vs USD103.78 million in 1Q20). However, COGS also fell from USD69.21 million in 1Q20 to USD48.77 million in 1Q21. MDKA posted a net loss of USD4.98 million in 1Q21 (vs a net profit of USD14.97 million in 1Q20) (CNBC Indonesia). MNCS Comment: MDKA's decline in performance was due to a significant drop sales volume on gold (-29.59% YoY) and cooper (-70.58% YoY), and despite the weakening cost, it still cannot offset the topline, therefore, causing MDKA to book a loss in 1Q21. We see that this is also probably due to the business activities that are still hindered by the pandemic, which resulted in lower production. MDKA is trading at 5.98x PBV.
2. PWON IJ issued additional debt securities worth USD100 million with an interest rate of 4.87% per year and will mature in 2028. These bonds are consolidated with initial bonds worth USD300 million so that the total debt securities that have been issued by PWON are USD400 million. The proceeds after deducting the issuance costs will be used for public operational purposes (Kontan). MNCS Comment: The issuance is to maintain the company's cash flow, this must be supported by the smooth running of the property business during the period of the bonds. PWON is currently trading at 25.79/1.64x PE/PBV.
3. HEAL IJ posted revenue of IDR4.41 trillion in FY20, which is an increase of + 21.48% YoY (vs IDR3.63 trillion in FY19). However, the cost of revenue also increased from IDR2.03 trillion in FY19 to IDR2.28 trillion in FY20. HEAL posted a net profit of IDR473.22 billion in FY20 which increased + 85.30% YoY (vs IDR255.38 billion in FY19) (IQ Plus). MNCS Comment: This realization was due to the improvement in inpatient / outpatient in 3Q20-4Q20. In addition, it is also supported by the specialization of the mother and child hospital business, which has an impact on maintaining the classification of HEAL patients in FY20. Currently HEAL is trading at 30.34x/5.63x PE/PBV.
IHSG Updates
JCI dropped by -1.27% to 5,760.57 on Wednesday (19/05) followed by net foreign sell reaching IDR280.93 billion. JCI weakened as most of the sectors fell with basic industry leading, followed by finance, property and non-cyclical. On the other hand, the tech sector managed to soar significantly by +7.10%. Meanwhile, the Rupiah exchange rate was weakening at IDR14,290. We estimate JCI will move in the range of 5,750-5,870 while waiting for Balance of Trade data release. Today's recommendation: INCO, BBCA, INDF, JSMR.
Corporate Action
Cum Dividend Date: DMAS (IDR6.5/share), BSSR (IDR222.77/share)
Rights Issue: CENT (IDR200/share)
Disclaimer On
