Global Market Highlight
DJIA rose by +0.65% on Friday (20/08) followed by S&P 500 (+0.81%), and Nasdaq (+1.19%). Wall Street closing was higher despite concerns about the economic growth amid the rising of COVID-19 cases, which continued to take its toll on oil prices. Markets will be watching for any clearer indication on plans for the Fed taper of monthly bond purchases, which minutes showed officials believed would happen this year if the economy recovers as expected. On the other hand, Brent crude ended the week down by -2.17% at USD65.01 per barrel, followed by the US crude (-2.26%) at USD62.25 per barrel. Today the market will be looking forward to several data releases such as: 1) US Markit Manufacturing PMI Flash; 2) Germany Markit Manufacturing PMI Flash; 3) UK Markit/CIPS Manufacturing PMI Flash.
Domestic Update
• Government will again decide whether to extend the period of PPKM level 4 particularly in the Java-Bali region or loosen social restrictions on Monday (23/08). MNCS Comment: Daily cases dropped by ~20% on a weekly basis, however we remained cautious on the stagnated of Covid-19 testing undertaken. Average daily testing declined by 2.3% on a monthly basis on August-21. At the same time the positivity rate stayed above 20% indicating that the outbreak has not been brought under control. Hasty lifting of public activity limitation would be too risky, therefore we expect that the government would likely to extend PPKM level 4 for at least a week ahead.
• Furthermore, there was an addition of 701 new Covid-19 cases in Jakarta yesterday.
Company News
1. FREN IJ posted IDR4.95 trillion revenue in 1H21 spiked by +15.11% YoY (vs IDR4.30 trillion in 1H20). COGS decreased from IDR5.17 trillion in 1H20 to IDR5.03 trillion in 1H21. FREN recorded IDR451.91 billion net loss in 1H21 the numbers are lower than previous year (vs net loss of IDR1.22 trillion in 1H20) (Bisnis Indonesia). MNCS Comment: We believe that FREN’s improvement performance is supported by the increase of data services and the efficiency. The acquisition of Moratel gives added value for FREN to open opportunities for various synergies. We believe FREN will post profit in FY22E. Currently FREN is trading at 3.05x PBV levels.
2. FILM IJ will distribute FY20 cash dividends of IDR11/share or reach by IDR100 billion from the total FY20 net profit of Rp35.98 billion. The Cum Date Schedule is 27 August 2021 (Emitennews). MNCS Comment: FILM's payout ratio is 177% of FY20 net profit, subsequently, the total dividend yield offered is 3.07%. Currently FILM is trading at 47.32x/2.51x PE/PBV levels.
3. TBLA IJ posted IDR6.83 trillion revenue in 1H21 increased by +20.04% YoY (vs IDR5.69 trillion in 1H20). Subtainly, COGS increased from IDR4.43 trillion in 1H20 to IDR5.41 trillion in 1H21. TBLA recorded IDR379.55 billion net profit in 1H21 rose by +21.58% YoY (vs IDR312.18 billion in 1H20) (Emitennews). MNCS Comment: We see that TBLA is still benefitted from the CPO price increase as 71% of their revenue still came from palm oil while the rest is from sugar refinery. We believe TBLA will continue to book an increase on performance along with the CPO strengthening. Currently TBLA is trading at 5.45x/0.66x PE/PBV levels.
IHSG Updates
JCI rose by +0.64% to 6,030.77 on Friday (20/08) with net foreign buy reaching IDR156.86 billion. JCI closed higher in almost all sectors led by the infrastructure sector (+1.63%) followed by the cyclical sector (+1.21%). On the other hand, the industrial sector decreased by -0.68% followed by the energy sector (-0.21%). The JCI managed to strengthen in the midst of market concerns about the tapering sentiment from the Fed, and it seems that the optimism of foreign investors towards the Indonesia economic outlook was able to improve the index's performance. On the other hand, Rupiah weakened by -0.35% to Rp14,453/USD in the spot market as the weakest closing throughout August-21. We estimate the JCI will move in the range of 5,950-6,060 while waiting for the inflation rate MoM. Today's recommendation: BRIS, MLPL, PTBA, FREN.
Corporate Action
Cum Dividend Date: ASDM (IDR95/share), EKAD (IDR45/share), SHIP (IDR35/share)
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