Global Market Highlight
DJIA rose by +0.62% on Wednesday (11/08) followed by the S&P 500 (+0.25%), while Nasdaq slipped by -0.16%. Wall Street closing was mixed with the news of US lawmakers approving a USD1.2 trillion infrastructure package on Tuesday. Subsequently, investors were focused on US inflation which increased 5.4% as of July-21 or higher than consensus, as it will hint the next Federal Reserve policy. Today the market may be watching several data releases such as: 1) US PPI MoM; 2) UK GDP Growth YoY; 3) Eurozone Industrial Production YoY.
Domestic Update
• According to BI, Indonesia retail sales grew 2.5% YoY in June-21. This figure was lower than respondents' expectation to grow 4.5% YoY in the previous survey. MNCS Comment: A weaker retail sales performance was driven by lower public demand as consumption normalized post Ramadan festivities and Eid ul Fitr national religious holiday. June-21's positive figure was primarily driven by automotive fuels and clothing demand.
• Furthermore, there was an addition of 1,958 new Covid-19 cases in Jakarta yesterday.
Company News
1. AGRO IJ recorded IDR433.66 billion net interest income in 1H21 growth by +34.21% YoY (vs IDR323.13 billion in 1H20). Interest expense decreased from IDR675.01 billion in 1H20 to IDR445.46 billion in 1H21. AGRO recorded IDR26.22 billion net profit in 1H21 increased by +31.10% YoY (vs IDR20.00 billion in 1H20) (IQ Plus). MNCS Comment: Net profit exceeded our estimate which implies 57% of our FY21E target. We believe that the support from the BRI group ecosystem and a strong digital strategy drive AGRO to become the best state-owned digital bank. Currently AGRO is trading at 677.93x/11.41x PE/PBV levels.
2. ELSA IJ posted IDR3.71 trillion revenue in 1H21 decreased by -4.87% YoY (vs IDR3.90 trillion in 1H20). COGS decreased from Rp3.48 trillion in 1H20 to IDR3.43 trillion in 1H21. ELSA recorded IDR40.15 billion net profit in 1H21 or slipped by -69.20% YoY (vs IDR130.35 billion in 1H20) (CNBC Indonesia). MNCS Comment: We consider that the Covid-19 outbreak has an impact on the withdrawal of several work projects by KKKS, so that the achievements in 1H21 have not been optimal. Currently ELSA is trading at 23.63x/0.50x PE/PBV levels.
3. BWPT IJ recorded revenue of IDR1.36 trillion in 1H21 growth by +11.48% YoY (vs IDR1.22 trillion in 1H20). COGS increased from IDR1.09 trillion in 1H20 to IDR1.12 trillion in 1H21. BWPT recorded IDR1.66 trillion net loss in 1H21 or higher than the previous year of -IDR416.83 (IQ Plus). MNCS Comment: Despite the increase on 1H21 gross profit margin to 17% (vs 10% in 1H20), BRPT still experienced loss caused by disposal of subsidiaries amounting to IDR1.4 trillion which result in a deeper net loss. Currently BWPT is trading at 1.42x PBV levels.
IHSG Updates
JCI fell by -0.64% to 6,088.41 on Tuesday (10/08) while net foreign buy reaching IDR14.87 billion. JCI closed lower in most sectors led by the tech sector (-3.50%) followed by the transport sector (-1.14%). On the other hand, the cyclical sector strengthened by +1.00% followed by the industrial sector (+0.72%). The JCI weakened due to the extension of Level 4 Social Restrictions or PPKM until 16th August 2021, especially for the Java and Bali regions, which contributed for more than 60% of the national economy. Meanwhile the Rupiah exchange rate was weakening at IDR14,383. We estimate the JCI will move in the range of 6,050-6,150 while waiting for the balance of trade data release. Today's recommendation: BRPT, EXCL, LSIP, LPPF.
Corporate Action
Cum Dividend Date: ATAP (IDR0.39/share)
Reverse Split: BBRM (3:2)
Public Expose: SNLK
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