Global Market Highlights
DJIA gained +0.24% on Wednesday (05/04), while the S&P500 (-0.24%) and Nasdaq (-0.25%). Wall Street closed mixed, where investor fears of an economic slowdown increased again, after the release of the ISM Non-Manufacturing PMI data in Mar-2023 which fell significantly to 51.2 (vs 55.1/54.5 in Feb-2023/consensus ). Today, the market will be looking toward several data releases such as: 1) US Initial Jobless Claims Apr 1; 2) Germany S&P Global Construction PMI Mar; 3) UK S&P Global/CIPS Construction PMI Mar.
Domestic Update
• The prices of 13 types of non-subsidized fuel from all distributors were simultaneously lowered, with the decrease ranging from IDR800/liter to IDR1,800/liter in April. MNCS Comment: Even in the midst of rising prices after the announcement of OPEC+ production cuts, price cuts were made to support public transportation purchasing power for homebound travels ahead of Idul Fitri.
Company News
1. JPFA IJ will distribute cash dividends for the FY22 fiscal year of IDR581 billion, or the equivalent of IDR50 per share (Kontan). MNCS Comment: So, we estimate JPFA will offer a dividend yield of 0.45%. Payout ratio of 40.9%. In FY22, JPFA recorded a -29.8% YoY drop in net profit to IDR1.4 trillion (vs IDR2.0 trillion in FY21). Currently, JPFA is traded at the level of 9.13x/1.02x PER/PBV.
2. INKP IJ will build a new factory facility and its supporting facilities through an expansion worth USD3.53 billion, the factory capacity can reach 3.9 million tonnes/year (Market Bisnis). MNCS Comment: We anticipate that the total production capacity of INKP will increase to ~7 million tonnes per year upon completion of the new factory, which can bolster the company's revenue streams. Currently, INKP is traded at the level of 2.98x/0.46x PER/PBV.
3. AALI IJ will increase its capex allocation +7% YoY to IDR1.4 trillion in FY23E (vs IDR1.3 trillion in FY22), of which around IDR500-IDR600 billion will be used for replanting oil palm plants (Investor ID). MNCS Comment: The increasing capex especially to replant oil palm trees can boost FFB yields for the company, whose aging plant profile is currently causing decreased production. Currently, AALI is traded at the level of 9.14x/0.73x PER/PBV.
IHSG Updates
JCI weakened -0.20% to 6,819.68 on Wednesday (05/04), followed by net foreign buy of IDR1.65 trillion. A number of sectors experienced weakening and weighed on the index, led by the technology sector (-1.31%) followed by the raw materials sector (-1.16%). On the other hand, the sector that led the gains was the property sector (+0.71%) followed by the cyclical sector (+0.15%). The weakening of the JCI was in line with most Asian stock exchanges, where investors were watching uncertainties in the US, following the release of weak labor market data and a contraction in the manufacturing industry, hinting at an economic slowdown. The rupiah closed lower at IDR14,925/USD. We estimate that the JCI will move in the price range of 6,791-6,814. Today's recommendation: AGII, APLN, LSIP, ANTM.
Corporate Actions
Cum Dividend: SIDO (IDR23/share), LPPF (IDR525/share)
RUPS: MPMX
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