Global Market Highlight
DJIA rose by +0.41% on Friday (06/08) followed by the S&P 500 (+0.17%), while Nasdaq slipped by -0.40%. The Wall Street closing was mixed as the release of US employment data as of July which showed positive results. US employment data showed that it had created 943,000 new jobs in the last month, higher than economists in a Dow Jones poll which had expected at 845,000. Today the market may be watching several data releases such as: 1) US Consumer Inflation Expectations; 2) Germany Balance of Trade; 3) China Inflation Rate YoY.
Domestic Update
• In the recent press conference, the government has decided to keep its housing VAT incentive up until the end of 2021. Therefore, previous policy which is stated in the MoF article of 21/PMK.010/2021 that stipulated housing VAT incentive from April-August 2021 will no longer prevail. MNCS Comment: We welcome this policy and hope the multiplier effect will support domestic demand for property and propping up other related sectors performance. In 2Q21 real estate and construction sectors grew 2.82% YoY and 4.42% YoY respectively. We already witnessed that countercyclical fiscal measures started to show the impact as 2Q21 GDP grew positively marking the end of 4-quarter streak recession, partly bolstered by government expenditure which grew 8.06% YoY. We believe policy coordination and synergy among government institutions to pursue accommodative macro policy to remain needed during this time and will be too soon to be lifted as the domestic economy is still shaken by the Delta variant of SARS-CoV-2 widespread.
• Furthermore, there was an addition of 1,649 new Covid-19 cases in Jakarta yesterday.
Company News
1. BBRI IJ recorded IDR47.14 trillion revenue in 1H21 increased by +29.15% YoY (vs IDR36.50 trillion in 1H20). Deposits rose by +2.23% YoY to IDR1,096.45 trillion. BBRI recorded a net profit of IDR12.47 trillion in 1H21 or up +22.50% YoY (vs IDR10.18 trillion in 1H20) (CNBC Indonesia) MNCS Comment: BBRI’s loan disbursement grew by +1.7% QoQ/0.7% YoY driven by the micro loan segment. Net profit was lower than MNCS forecast and consensus, implying 45%/41% of FY21E target. Currently BBRI is trading at 19.43x/2.43x PE/PBV levels.
2. BRPT IJ posted USD1.56 billion revenue in 1H21 increased by +40.97% YoY (vs. USD1.10 billion in 1H20). COGS rose from USD902.10 million in 1H20 to USD1.06 billion in 1H21. BRPT recorded USD95.49 million net profit in 1H21 (vs. net loss of USD14.53 million in 1H20) (Emitennews). MNCS Comment: We see that BRPT's improvement is supported by the petrochemicals segment improving by 50.4% YoY while the energy business decreased. Currently BRPT is trading at 38.04x/5.12x PE/PBV levels.
3. ADRO IJ recorded 13.62 million tons of coal production in 2Q21. This realization was 6% higher QoQ of 12.87 million tons. Sales volume in 2Q21 grew by +5% QoQ to 13.19 million tons (vs 12.59 million tons in 1Q21) (Bisnis Indonesia). MNCS Comment: ADRO's production and sales volume are quite in line with our estimate by 51%/49%. We see that ADRO may achieve the 52 million mt sales and volume estimate in FY21E. Currently ADRO is trading at 9.87x/0.73x PE/PBV levels.
IHSG Updates
JCI fell by -0.03% to 6,203.43 on Friday (06/08) followed by net foreign sell reaching IDR127.51 billion. JCI closed lower in most all sectors led by the financial sector (-0.86%) followed by the health sector (-0.52%). On the other hand, the technology sector strengthened by +3.16% followed by the industrial sector (+1.09%). JCI closed lower as an impact of the weakening of the majority of Asian indices last Friday, amid the increase of Covid-19 outbreak in Asia, especially in China as the largest economic country in Asia. Meanwhile the Rupiah exchange rate was weakening at IDR14,353. We estimate the JCI will move in the range of 6,120-6,260 while waiting for the Consumer Confidence Index. Today's recommendation: BMRI, PGAS, FREN, ERAA.
Corporate Action
Cum Dividend Date: TBLA (IDR25/share), BUDI (IDR6/share)
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