MNCS Morning Navigator

04 April 2024

MNCS Morning Navigator April 4, 2024

Global Market Highlights
The DJIA further slid by -0.11% on Wednesday (03/04), whilst on the other hand the S&P 500 managed to rebound +0.11%, followed by the Nasdaq (+0.23%). Wall Street closed mixed as investors responded to the release of US ISM Services Index Mar-2024 data which fell 1.2 points to 51.4; below market expectations at 52.8. At the same time, additional US ADP Employment Change Mar-2024 data increased +184k, exceeding the consensus estimate of +150k, to which the Fed official, Powell, responded that interest rate cuts would follow stronger mature indications of disinflation. Today the market will be waiting for several data releases, including: 1) US Balance of Trade Feb-2024; 2) GB S&P Global Services PMI Mar-2024; 3) EA Monetary Policy Meeting Accounts Mar-2024.

Domestic Update
The Ministry of Energy and Mineral Resources (ESDM) has set the average price of Indonesian crude oil (ICP) for Mar-2024 at USD83.79 per barrel, marking an increase of USD3.69 per barrel from Feb-2024. MNCS Comment: We assess this increase as in line with the strengthening of global crude oil prices (WTI & Brent), amidst anticipation of better demand growth compared to before, amid heightened geopolitical tensions and a decline in US oil reserves. In the short term, we see this price hike as a catalyst for correlated stocks such as MEDC, RAJA, and AKRA.

Company News
1. AMAR IJ recorded a net profit of IDR177.9 billion in FY23 after experiencing a net loss of IDR 155.4 billion in FY22 (Emiten News). MNCS Comment: This turnaround was driven by operational income growth of +42.8% YoY, reaching IDR1.3 trillion. This increase was supported by growth in net interest income +40.5% YoY and non-interest income +48.7% YoY. It is noted that AMAR's CAR is at 119.2%, providing room for the company to encourage future market expansion whilst maintaining the company's financial stability. AMAR is currently trading at 1.38x PBV.
2. ROTI IJ will distribute dividends amounting to IDR500 billion, or equivalent to IDR87.67 per share (Emiten News). MNCS Comment: With this, we estimate ROTI's dividend yield to be 7.3%. The realized DPS is lower than last year's of IDR106.55 per share, reflecting a -22.9% YoY decrease in net profit in FY23. Meanwhile, the average dividend yield over the last 5 years is 3.5%. ROTI is currently trading at 22.18x/3.09x PER/PBV.
3. CLEO IJ performed double-digit growths in both top-line and bottom-line for FY23 (Emiten News). MNCS Comment: The company booked a +24.85% YoY rise in revenue, supported by the bottle segment (+37.01% YoY), the non-bottle segment (+12.85% YoY), and other sales segment (+33.58% YoY). With a +9.43% YoY increase in COGS and +29.66% YoY rise in opex, the company managed to book a net income of IDR305.78 billion (+58.87% YoY), resulting in an improved NPM of 14.63% (vs 11.50% in FY22). CLEO is currently trading at 25.48x/6.06x PER/PBV.


IHSG Updates
The JCI declined by -0.97% to 7,166.84 on Wednesday (03/04), accompanied by a net foreign sell of IDR2.13 trillion. Most sectors weakened and exerted pressure the index’s movement, with the technology sector leading the loss (-1.48%) and followed by the property & real estate sector (-1.42%). Conversely, some strengthened sectors were led by the healthcare sector (+1.20%) and followed by the basic materials sector (+0.19%). The index fell in line with other Asian markets, following the minutes from The Fed, which indicated a decision to hold rates steady in the range of 5.25%-5.5% and maintain forecast for three rate cuts this year, albeit with anticipation of a delayed or slower shift. Additionally, JCI is pressured as the net foreign outflow remain strong. The Rupiah continued to close lower at IDR15,920/USD. Today's recommendations: BIRD, BREN, ENRG, PNLF.

Corporate Actions

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