Global Market Highlights
The DJIA rebounded by +0.06% on Thursday (18/04), while the S&P 500 (-0.22%) and Nasdaq (-0.52%) remained in the red zone. Wall Street closed mixed, reacting to an increase in UST yields to the 4.64% level. The yield increase was attributed to the Fed's hawkish comments about the diminishing likelihood of a rate cut. On the other hand, positive sentiment came from stable initial jobless claims as of 13-Apr’24, at 212k and existing home sales in Mar-2024, which contracted by -4.3% MoM. Today the market will be waiting for several data releases, including: 1) UK Retail Sales MoM Mar-2024; 2) Germany PPI MoM Mar-2024; 3) US Fed Goolsbee Speech.
Domestic Update
The Indonesian Shopping Center Management Association (APPBI) has set an increase in mall rental rates by an average of 5%-10%. Meanwhile, CTRA has also confirmed an increase in mall rental rates for FY24. MNCS Comment: We believe the rental rate increase will not significantly impact the increase in rental costs for retail companies in our universe, as the rental rates have already been set in contracts for 2-5 years. Furthermore, retail issuers are relatively moderate in expanding outlets this year, such as MAPI and ERAA.
Company News
1. PRDA IJ achieved a revenue of IDR2.22 trillion (+1.87% YoY) in FY23 (Kontan). MNCS Comment: This flat revenue performance was mainly supported by the growth in the non-laboratory (+11.03% YoY) and the routine (+7.89% YoY) segments, meanwhile income from esoteric line dropped by -16.25% YoY. Despite a slump in its bottom-line (-30.08% YoY) in FY23, the company is optimistic to aim for a revenue growth above Indonesia’s GDP target (>5.2%), with capex of IDR250-300 billion to support its business expansion plans. PRDA is currently trading at 13.28x/1.46x PER/PBV.
2. DMAS IJ reported marketing sales of IDR560 billion in 1Q24 (Kontan). MNCS Comment: DMAS marketing sales in 1Q24 experienced a -6.4% YoY decline compared to 1Q23, which amounted to IDR598 billion. Meanwhile, with the FY24E marketing sales target of IDR1.81 trillion, the realization up to 1Q24 reached 30.9% of the target. We anticipate solid growth for marketing sales post-election, potentially meeting management's guidance. DMAS is currently trading at 6.45x/1.33x PER/PBV.
3. TCPI IJ aims for +40% YoY of revenue growth in FY24 (Kompas). MNCS Comment: This target marks a significant increase from the actualized revenue growth of +3.84% YoY in FY23. Effective cost management was reflected in a -2.52% drop in the cost of revenue, which resulted in a +66.69% YoY rise in net income. To achieve this year’s goal, the company has prepared a capex budget of IDR 1.5 trillion to acquire additional ships and expand docking facilities. Additionally, the company’s recent success in securing a new IDR 15 billion contract with a coal company in Mar-2024 will further support this target. TCPI is currently trading at level 18.49x PBV.
IHSG Updates
The JCI rebounded by +0.50% to 7,166.81 on Thursday (18/04), amidst a net foreign sell of IDR723.71 billion. Some strengthened sectors were led by the financial sector (+0.82%) and followed by the infrastructures sector (+0.19%). On the other hand, most sectors plummeted with the healthcare sectors leading the loss (-1.06%) and followed by the properties & real estate sector (-0.75%). The index rose along with other Asian markets, amidst MSCI AC weakened -2.10%, following a positive outlook upon Fed Beige Book and a slowdown in USD exchange rate. The Rupiah closed higher at IDR16,175/USD. We estimate that the JCI will move in the price range of 7,130-7,194. Today's recommendations: AKRA, ASSA, EXCL, PGEO.
Corporate Actions
Cash Dividend: BNGA (IDR122.67/share), BNLI (IDR25/share), LPPF (IDR200/share)
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