Global Market Highlights
The DJIA strengthened by +1.29% on Wednesday (03/08), followed by the S&P 500 (+1.56%) and the Nasdaq (+2.59%). Wall Street rose amid the Fed's hawkish comments stating that inflation can be controlled even though a recession could occur. Meanwhile, US-China tensions improved after the visit of the US House of Representatives Speaker to Taiwan without any significant threat to China as well as the release of positive data, where the ISM Non-Manufacturing PMI Jul-22 grew expansively to a level of 56.7 points (vs 55.3 points at Jun-22) became the driver of the index's pace. Today, the market will be looking toward several data releases such as: 1) US Balance Of Trade; 2) US Continuing Jobless Claims JUL; 3) UK BoE Interest Rate Decision.
Domestic Update
• Government financing through the issuance of debt securities reached IDR564.74 tn as of August 2, 2022 (GDS: IDR359.93 trillion; Sukuk: IDR182.94 trillion; SKB III BI-MoF: IDR21.87 trillion). MNCS Comment: Lower SBN issuance reduces supply risk. On the other hand, the UST-SUN spread which is still below its historical level of 500 bps makes valuations less attractive and foreign investors continue to record outflows from the SBN market (IDR132.27 trillion YTD).
• Furthermore, the national Covid-19 daily rate had increased by 6,167 active cases (03/08).
Company News
1. HRUM IJ recorded a revenue growth in 1H22 of +226.2% YoY to USD377.5 million (vs USD115.7 million in 1H21). Meanwhile, net profit increased significantly by +1,309.6% YoY to USD146.0 million (vs USD10.4 million in 1H21). MNCS Comment: The revenue growth was supported by the increase in ASP in coal by +154.3% YoY accompanied by an increase in sales volume by +33.9% YoY to 2.1 million tons (vs 1.6 million tons in 1H21). The company's margin grew with GPM, OPM and NPM in 1H22 to 64.77%, 53.09% and 38.68%, respectively (vs. 47.75%, 30.91% and 8.95% in 1H21). Currently, HRUM is traded at the level of 5.57x/2.53x PER/PBV.
2. CPIN IJ recorded a revenue growth in 1H22 of +12.59% YoY to IDR28.64 trillion (vs IDR25.47 trillion in 1H21). Meanwhile, net profit fell by -14.68% YoY to IDR2.42 trillion (vs IDR2.83 trillion in 1H21) (Emiten News). MNCS Comment: The increase in revenue was in line with the growth in the broiler segment by +26.77% YoY and processed chicken by +22.12% YoY. Raw material costs increased by +19.48% YoY in line with high commodity prices, and pushed up COGS by +17.69% YoY which weighed on gross profit performance by -7.57% YoY. Currently, CPIN is traded at the level of 20.30x/3.67x PER/PBV.
3. BTPN IJ recorded a net interest income growth in 1H22 of +2% YoY to IDR5.72 trillion (vs IDR5.59 trillion in 1H21). Meanwhile, net profit grew by +2% YoY to IDR1.68 trillion (vs IDR1.64 trillion in 1H21) (Emiten News). MNCS Comment: The growth in the net interest income was supported by sharia interest income which rose +12.26% YoY amid lower interest income by -6.16% YoY and interest expense by -7.34% YoY as CoF fell to 2, 9% of 3.6%. NPL showed improvement where in 1H22 it was recorded at 1.35%, down from 1.46%. BTPN is currently traded at the level of 0.58x PBV.
IHSG Updates
JCI strengthened by +0.84% to 7,046.63 on Wednesday (03/08), followed by net foreign sell which reached IDR7.13 trillion. A number of sectors experienced strengthening and an encouraging index, led by the technology sector (+3.22%) followed by the infrastructure sector (+2.27%). On the other hand, the weaker sectors were led by the cyclical sector (-1.06%) followed by the non-cyclical sector (-0.43%). The strengthening of Asian bourses boosted the index. Investors were watching the release of China Caixin Services PMI Jul-22, which grew expansively to the level of 55.5 points (vs 54.5 on Jun 22). On the other hand, the Rupiah exchange rate closed lower at IDR14,913/USD. We estimate the JCI will move in the price range of 7,000-7,070. Today's recommendation: ADMR, DOID, EXCL, BNBA.
Corporate Action
Cum Dividend: CTRA (IDR14/share)
IPO: AMMS (IDR100/share), JARR (IDR300/share)
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