MNCS Morning Navigator

05 Agustus 2021

MNCS Morning Navigator August 05, 2021

Global Market Highlight
DJIA slipped by -0.92% on Wednesday (04/08) followed by the S&P 500 (-0.46%), While Nasdaq rose by +0.13%. The Wall Street closing was mixed due to concerns over an increase in the delta variant of Covid-19 cases in the US, there were 15,081 new cases recorded on Tuesday (03/08) bringing the total positive Covid-19 patients in the US to 34.81 million people. This had made Joe Biden asks local heads to take the pandemic more seriously. Furthermore the data release showing that the US private payrolls increased far less than expected in July, likely constrained by shortages of workers and raw materials. Today the market may be watching several data releases such as: 1) US Balance of Trade; 2) Canada Balance of Trade; 3) UK BoE Interest Rate Decision.


Domestic Update
Statistics Indonesia will release 2Q21 GDP data today at 11:00 AM. After slipping into a recession in the last four quarters, Indonesia's economy is expected to expand in 2Q21. MNCS Comment: Indonesia's economic output is likely to grow 3.23% QoQ or 6.95% YoY in 2Q21 marking the end of Covid-19 pandemic economic recession since 2Q20. Our expectation is in line with encouraging 2Q21 macro data release which showed domestic consumption gradually bouncing back while business activity strengthened at the same time, besides the low base effect. We believe that the market already priced in the positive growth in 2Q21.
Furthermore, there was an addition of 2,981 new Covid-19 cases in Jakarta yesterday.


Company News
1. MAIN IJ recorded IDR4.58 trillion revenue in 1H21 or up +43.42% YoY (vs IDR3.19 trillion in 1H20). COGS increased from IDR2.96 trillion in 1H20 to IDR4.12 trillion in 1H21. MAIN recorded a net profit of IDR128.86 billion in 1H21 or a significant increase of +420.39% YoY (vs net loss of IDR40.22 billion in 1H20) (Kontan). MNCS Comment: The increase in sales was driven by the broiler segment which rose by 14.4% QoQ in line with increased in ASP. We anticipate potentially stagnant sales in 3Q21 in line with the normalization of DOC prices and the tightening of emergency PPKM. Currently MAIN is trading at 6.27x/0.76x PE/PBV levels.

2. PRDA IJ posted IDR1.24 trillion revenue in 1H21 or up +88.34% YoY (vs IDR657.29 billion in 1H20). COGS increased from IDR319.45 billion in 1H20 to IDR471.42 billion in 1H21. PRDA recorded a net profit of IDR301.02 billion in 1H21 or a significant increase of +2,589.83% YoY (vs net loss of IDR12.09 billion in 1H20) (IQ Plus). MNCS Comment: PRDA's revenue realisation has reached 56.36% of the target, while net profit is equivalent to 77% of our target in FY21E. We see that PRDA's accomplishment is supported by revenue from Covid-19 test and the digitization that has been carried out as well as efficiency strategy. Currently PRDA is trading at 12.57x/3.92x PE/PBV levels.

3. TBLA IJ will distribute FY20 cash dividends of IDR25/share or reaching IDR131.92 billion of the total FY20 net profit of IDR678.03 billion. Cum dividend on August 9, 2021 (Emitennews). MNCS Comment: TBLA's dividend payout ratio is 19.46% of FY20 net profit, while the dividend yield offered is 3.09% or lower than FY19's yield of 3.14%. Currently TBLA is trading at 5.57x/0.71x PE/PBV levels.


IHSG Updates
JCI rose by +0.46% to 6,159.04 on Wednesday (04/08) followed by net foreign buy reaching IDR358.47 billion. JCI closing was higher along with most sectors led by the transport sector (+1.31%) followed by finance (+1.30%). On the other hand, both techno and industrial weakened by -0.68%. JCI closing was higher due to positive sentiment of the decline in daily Covid-19 cases. The average number of daily Covid-19 cases increased by 33,900 people per day. On the other hand, the number of recovered patients continuously increased, even more than the addition of daily positive cases. In the past week, the average number of recovered patients increased by 39,550 people per day. Meanwhile the Rupiah exchange rate was strengthening at IDR14,313. We estimate the JCI will move in the range of 6,048-6,230 while waiting for GDP growth YoY. Today's recommendation: BBRI, ACES, BSDE, JPFA.


Corporate Action
Cum Dividend Date: CLPI (IDR89.39/share), ISSP (IDR6/share), DGNS (IDR4.8/share)


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