Global Market Highlight
DJIA slipped by -0.28% on Monday (02/08) followed by the S&P 500 (-0.18%), while Nasdaq strengthened by +0.06%. The Wall Street closing was mixed due to falling oil and Treasury prices, subsequently market concerns about the slow economic growth as the Covid-19 Delta variant outbreak. The US Manufacturing PMI data on Jul-21 fell to 59.5 (vs. 60.9 in Jun-21). On the other hand, the US Senate has submitted infrastructure stimulus proposals of USD1 trillion. Today the market may be watching several data releases such as: 1) US Factory Orders MoM; 2) Canada Markit Manufacturing PMI; 3) Eurozone PPI MoM.
Domestic Update
• President Joko Widodo announced that the government decided to extend PPKM level 4 up until August 9, 2021 in several regions that remained in a red zone of Covid-19. Those regions which are impacted by this policy include Jakarta, Bali, Greater Malang Area, Greater Solo Area and Jogjakarta. MNCS Comment: In our view, the government needs to be careful when it comes to lifting social and public health measures as daily cases fluctuation might still haunt. We see that the impact of PPKM implementation would cost significantly to the economy particularly for already hard hit sectors such as manufacturing, retail, tourism and transportation. Therefore in order to cushion the impact of tighter social restriction, strengthening coordination between central and regional government would be needed particularly in terms of social assistance disbursement as regional budget realization remained low.
• Furthermore, there was an addition of 1,410 new Covid-19 cases in Jakarta yesterday.
Company News
1. INDY IJ posted USD1.29 billion revenue in 1H21 increased +14.15% YoY (vs USD1.13 billion in 1H20). COGS rose from USD954.65 million in 1H20 to USD999.88 million in 1H21. INDY recorded a net profit of USD12.01 million in 1H21 (vs net loss of USD21.92 million in 1H20) (CNBC Indonesia). MNCS Comment: INDY successfully booked a net profit after suffering a loss due to the pandemic last year. We see that the increase in coal ASP contributes to INDY's top line. Currently INDY is trading at 27.87x/0.72x PE/PBV levels.
2. MAPI IJ posted IDR9.13 billion revenue in 1H21 rose by +33.87% YoY (vs IDR6.82 billion in 1H20). COGS increased from IDR3.89 billion in 1H20 to IDR5.89 billion in 1H21. MAPI recorded a net profit of IDR288.05 million in 1H21 or an increase (vs net loss of IDR455.81 million in 1H20) (IQ Plus). MNCS Comment: The solid performance in 2Q21 mainly driven by 27% QoQ increase in online sales during Lebaran. We believe the increase in online sales combined with the PPKM relaxation will be able to support MAPI's performance throughout FY21E. Currently MAPI is trading at 19.70x/1.88x PE/PBV levels.
3. HRUM IJ posted revenue of USD155.72 million in 1H21 or up +12.84% YoY (vs USD102.54 million in 1H20). COGS fell from USD71.21 million in 1H20 to USD69.47 million in 1H21. HRUM recorded a net profit of USD10.35 million in 1H21 or down -52.77% YoY (vs USD21.92 trillion in 1H20) (Bisnis Indonesia).MNCS Comment: Despite the rise on top line and efficiency on COGS, HRUM's bottom line drop was due to the increase on other costs which consist of changes on asset fair value and loss on fixed asset sales. Currently HRUM is trading at 15.27x/2.78x PE/PBV levels.
IHSG Updates
JCI rose by +0.44% to 6,096.54 on Monday (02/08) while net foreign sell reaching IDR2.95 billion. JCI closing was higher along with most sectors led by non-cyclical (+1.76%) followed by industrial (+1.07%). On the other hand, the transport sector fell by -1.21%, followed by techno (-0.70%). JCI closing was slightly higher in the midst of waiting for the Social Activity Restrictions (PPKM) announcement by the government. The investor still hopes that there will be some easing amid the sloping down of Covid-19 outbreak in DKI Jakarta. Meanwhile the Rupiah exchange rate was strengthening at IDR14,423. We estimate the JCI will move in the range of 6,050-6,120 while waiting for GDP growth YoY. Today's recommendation: ASII, MIKA, TINS, BRPT.
Corporate Action
Cum Dividend Date: CPIN (IDR112/share), AKRA (IDR60/share)
Public Expose: SBAT
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