Global Market Highlights
The DJIA strengthened by +0.36% on Friday (08/12), followed by S&P500 (+0.41%) and Nasdaq (+0.45%). Wall Street gained fuel by expectations of a soft landing, whereas the release of Non Farm Payrolls data in Nov-2023 recorded at 199k, (vs Oct-2023 of 150k). Additionally, inflation expectations by Michigan version for Dec-2023 decreased to 3.1% from the previous of 4.5%, thus driving the index. Today, the market will be looking toward several data releases such as: 1) Japan BSI Large Manufacturing QoQ Q4; 2) Japan Machine Tool Orders YoY Nov-23; 3) US Consumer Inflation Expectations Nov-23.
Domestic Update
Bank Indonesia (BI) reported the Consumer Confidence Index (IKK) in Nov-2023 at 123.5. MNCS Comment: The realization of IKK in Nov-2023 was below the Oct-2023 achievement of 124.3 but remained at an optimistic level. We observe a shifting in the expenditure proportion of the mid-high class, with a significant increase in consumption levels followed by a decrease in installment and savings levels. This delivers positive signs for retail companies, especially close to the year-end festive. Meanwhile, mid-low class experienced a decline in consumption levels, reflecting prioritization of needs for food staples that experienced a price spike in Dec-2023.
Company News
1. NCKL IJ targets nickel ore production of 32 million metric tons in FY25F (Market Bisnis). MNCS Comment: The increase in production targets will be supported by the capacity expansion of the RKEF smelter operations, with the current total production capacity at ~18 million metric tons. With the potential capacity addition of +77.8%, we anticipate robust company performance in the future. Currently, NCKL is traded at a level of 10.92x/2.93x PER/PBV.
2. INCO IJ targets nickel matte production of 70k tons in FY23E (Investor ID). MNCS Comment: In 9M23, INCO recorded a 17.6% YoY increase in nickel matte production to 51.6k tons (vs 43.9k tons in 9M22). Thus, we note the company's production realization is 73.8% of the set target. We are optimistic that the company can meet the target, considering the production realization in 9M23 is still in-line. Currently, INCO is traded at a level of 9.51x/1.11x PER/PBV.
3. BREN IJ plans to acquire the Wind Power Plant (PLTA) PT UPC Sidrap Bayu Energy (SIDRAP) (Emiten News). MNCS Comment: We note that the production capacity of PLTA SIDRAP reaches 75 GW. We view this acquisition plan positively as it can strengthen the company's footprint in the Renewable Energy (EBT) business, which can drive the company's performance in the future. Additionally, we expect incentives for EBT companies to be distributed, serving as a cushion in the future. Currently, BREN is traded at a level of 271.46x PBV.
IHSG Updates
The JCI strengthened by +0.35% at 7,159.60 on Friday (08/12), followed by a net foreign sell of IDR233.45 billion. Most sectors experienced gains and pushing the index up, led by the technology sector (+2.89%) followed by the infrastructure sector (+2.04%). Conversely, weakened sectors were led by the financials sector (-1.83%) followed by the transportation & logistic sector (-1.04%). The index went up as investors reacted positively to the optimist Consumer Confidence index (IKK) at the level of 123.6. Meanwhile, China reported deflation of -0.5% YoY in Nov-2023 (vs consensus -0.1% YoY), marking the deepest deflation since Nov-2020. The Rupiah closed higher at IDR15,510/USD. We estimate the IHSG will move within the price range of 7,100-7,180. Today's Recommendations: ARTO, BBNI, MDKA, MTEL.
Corporate Actions
Stock Split : ASDM (1:2)
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