21 Mei 2021
MNCS Morning Navigator 21 May 2021
Global Market Highlight
DJIA grew by +0.96% on Thursday (20/05) followed by S&P 500 (+1.24%) and Nasdaq (+1.80%). Wall Street bounced back, snapping a three-day losing streak as a rally in tech triggered optimism. Tech was also boosted by a slip in US 10-Year yield as the Fed will begin to announce plans to rein in its monthly bond purchases. The April meeting arrived before the weak jobs numbers release which could potentially cool some tapering decisions. Moreover, the market will look forward to several data releases today, such as: 1) US Markit Manufacturing PMI Flash; 2) Japan Inflation Rate; 3) Eurozone Consumer Confidence.
Domestic Update
• Indonesia's trade balance had a surplus of USD2.19 billion. The value of Indonesia's exports in April 2021 increased slightly by 0.69% to USD18.48 billion. The export value increased by 0.69% from March 2021 which amounted to USD 18.35 billion. This was driven by rising prices for several mainstay commodities and increased demand from trading partner countries of Indonesia. Imports in April 2021 amounted to USD 16.29 billion. This value is up 29.93% YoY from April 2020, although when compared to March 2020 which was recorded at USD 16.79 billion, this is down 2.98% MoM (BPS).
• Minister of Finance Sri Mulyani is targeting a state budget deficit of -4.51% to -4.85% of GDP. The state budget deficit is due to high state spending reaching 14.69% -15.30% of GDP. Meanwhile, state revenues ranged from 10.18% -10.44% of GDP (Kontan).
• Furthermore, there was an addition of 895 new Covid-19 cases in Jakarta yesterday.
Company News
1. ISAT IJ posted revenue of IDR7.34 trillion in 1Q21, an increase of +12.60% YoY (vs IDR6.52 trillion in 1Q20). However, there was an increase in total expenses to IDR6.42 trillion from the previous IDR6.33 trillion. ISAT posted a net profit of IDR172.15 billion in 1Q21 which increased (vs net loss of IDR605.61 billion 1Q20) (CNBC Indonesia). MNCS Comment: The solid EBITDA growth of 42.5% reflects improved operational efficiency and strong revenue growth in line with the massive absorption of the 4G business. Meanwhile, sales of towers also help to improve the balance sheet. ISAT is trading at 50.31/2.87x PE/PBV.
2. SMBR IJ targets cement sales to reach 2.19 million tons this year, an increase of +11% YoY. SMBR was able to record a cement sales volume growth of 21.5% YoY in 1Q21. This result had a positive impact on SMBR's net income which rose 20.1% YoY in 1Q21 to IDR403.49 billion (Kontan). MNCS Comment: The company's optimism for the cement sales target is inseparable from the infrastructure development and construction activities that have been running again since the beginning of 2021. This has also increased national cement sales, including SMBR, even so the company continues to implement an efficiency strategy and implement sales through digital platforms that are estimated to run at the end of 2021. SMBR is currently trading at 96.70/2.03x PE/PBV.
3. PPRE IJ expanded the nickel mining infrastructure development contract in Weda Bay, Central Halmahera, North Maluku. The contract is an extension of the hauling road construction that is being carried out by the company and is part of the development of the largest nickel downstream industry in Indonesia. The acquisition of new contracts reached 25% of the total new contract target of IDR3.7 trillion. And the total contracts that have been obtained until April 2021 are IDR933 billion (Bisnis Indonesia). MNCS Comment: The contract achievement is quite good, PPRE is one of the sub-construction companies specializing in mining construction. Currently PPRE is trading at 28.23x/0.88x PE/PBV.
IHSG Updates
JCI rose by +0.64% to 5,797.60 on Thursday (20/05) followed by net foreign sell reaching IDR17.65 billion. JCI was backed by a positive balance trade release while most sectors increased despite a drop in basic industry, property and energy sectors. Meanwhile, the Rupiah exchange rate was weakening at IDR14,375. We estimate JCI will move in the range of 5,750-5,870 while waiting for the 7DRR Interest Rate Decision. Today's recommendation: PGAS, AKRA, BSDE, ERAA.
Corporate Action
Cum Dividend Date: INDS (IDR85/share), TUGU (IDR52.2/share), TGKA (IDR325/share)
Disclaimer On
PGAS,
AKRA,
BSDE,
ERAA,
ISAT,
SMBR,
PPRE
