MNCS Morning Navigator

06 April 2022

MNCS Morning Navigator April 6, 2022

Global Market Highlights
DJIA weakened -0.80% on Tuesday (05/04), followed by S&P 500 (-1.26%) and Nasdaq (-2.26%). Wall Street depreciated triggered by an increase in the yield on the US T-Note 10 Y to 2.57% after the Fed signaled more aggressive monetary tightening and faster balance sheet cuts in May-22. In addition, the market responded negatively to the plan to add economic sanctions to Russia, which is thought to increase commodity prices followed by inflation. Today, the market will be looking toward several data releases such as: 1) US MBA Mortgage Applications; 2) UK S&P Global Construction PMI; 3) Germany S&P Global Construction PMI.

Domestic Update
• Government has issued 6 series of sharia securities worth IDR8.1 trillion yesterday. The total incoming bids were IDR18.1 trillion or higher than in the previous auction at IDR13.4 trillion. MNCS Comment: Higher incoming bid value was a positive sign, yet we see that investors' appetite remained toward shorter maturity fixed income assets as indicated by incoming bids to SPNS04102022 that reached IDR8.2 trillion.
• Furthermore, the second dose of vaccination rate nationally has reached 76.9% or equivalent to 160.11 million people.

Company News
1. LPPF IJ will distribute cash dividends of IDR657.5 billion or equivalent to IDR250/share. Previously, LPPF had given an interim dividend on Dec-21 of IDR100/share. In total, LPPF has paid dividends of around IDR920 billion in FY21 with a Dividend Payout Ratio of 100.77% of net profit of IDR913 billion in FY21. (Bisnis Indonesia). MNCS Comment: That way, LPPF will offer a cash dividend yield of 4.31% in FY21, or better than the last 2 years, where the company did not distribute dividends. LPPF is trading at the level of 16.69x/15.14x PER/PBV.
2. INKP IJ recorded net sales of USD3.51 billion in FY21 or an increase of +17.75% YoY (vs USD2.98 billion in FY20). Net profit increased by +79.25% YoY to USD527 million in FY21 (vs USD294 million in FY20) (Bisnis Indonesia). MNCS Comment: The increase in performance was driven by sales of industrial paper, tissue, and others which rose +28.76% YoY to USD1.46 billion. Meanwhile, sales of cultural paper and pulp increased +13.71% YoY and +8.53% YoY respectively. INKP is trading at the level of 5.89x/0.65x PER/PBV.
3. SAME IJ recorded a net service revenue of IDR1.27 trillion in FY21 or up +55.68% YoY (vs IDR816.82 billion in FY20). Meanwhile, net profit increased to IDR138.55 billion in FY21 (vs net loss of IDR187.64 billion in FY20) (IQ Plus). MNCS Comment: The largest revenue contribution came from medical support revenue of IDR734.35 billion or 57.78% of total revenue, which increased +61% YoY. Meanwhile, inpatient revenue had the largest growth at +89% YoY with a value of IDR319.02 billion in FY21. SAME is trading at the level of 54.10x/1.95x PER/PBV.

IHSG Updates
JCI rose +0.45% to 7,148.30 on Tuesday (05/04), followed by net foreign buys which reached IDR917.09 billion. The majority of sectors strengthened and supported the index movement, led by the technology sector (+2.84%) followed by the energy sector (+1.62%). On the other hand, the weaker sector was led by the financial sector (-0.02%) followed by the property sector (-0.01%). Investors are watching the recurring geopolitical conflict of Russia-Ukraine where the plan to add sanctions against Russia is allegedly going to increase commodity prices again, which will have a positive impact on the index. On the other hand, the Rupiah exchange rate closed high at IDR14,355/USD. We estimate that the JCI will move in the price range of 7,100-7,160. Today’s recommendation: ELSA, BBYB, ADRO, ERAA.

Corporate Action
Cum Dividend: EAST (IDR1.33/share)

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