Global Market Highlights
The DJIA strengthened by +0.15% on Friday (15/12), while S&P500 (-0.01%) and Nasdaq (+0.35%). Wall Street closed mixed as investors observed several disappointing macroeconomic data. The Manufacturing PMI Flash for Dec-2023 contracted further to 48.2 (vs cons. of 49.3), and the Industrial Production data for Nov-2023 grew by only +0.2% MoM, below the consensus estimate of +0.3% MoM. Today, the market will be looking toward several data releases such as: 1) US NAHB Housing Market Index Dec-23; 2) Germany Ifo Business Climate Dec-23; 3) China FDI YoY Nov-23.
Domestic Update
BPS reported a trade surplus of USD2.41 billion in Nov-2023. MNCS Comment: We note that the trade surplus in Nov-2023 decreased compared to the realization in Oct-2023 of USD3.48 billion and was below the consensus estimate of USD3.05 billion. This decline was influenced by a -0.67% MoM contraction in export performance, amid an increase in import performance reaching +4.89% MoM. The contraction in export performance is attributed to a -6.39% MoM decline in oil and gas exports. Looking ahead, we anticipate that the trade balance performance remains challenging, given the potential increase in oil import during the festive season, accompanied by relatively flat commodity demand in line with the economic development of exporting countries.
Company News
1. TRGU IJ is optimistic about achieving solid top-line growth in FY24F (Investor ID). MNCS Comment: TRGU recorded revenue of IDR3.9 trillion, representing a +54.1% YoY increase. With business expansion in the livestock feed segment, realized through its latest facility in 3Q23, we expect this to drive better company performance in the future. Currently, TRGU is traded at 1.51x PBV.
2. ENRG IJ projects a 10%-15% YoY growth in oil and gas production in FY24F (Investor ID). MNCS Comment: We see the production growth projection is aligned with several strategic acquisitions made by the company. The company has 13 managed assets such as Blok Gebang PSC and Blok Tongah PSC. We anticipate improved company performance ahead, supported by a Rp2.3 trillion capex with a focus on drilling. Currently, ENRG is traded at a level of 5.65x/0.54x PER/PBV.
3. ITMA IJ plans to acquire a 54 MW power plant in East Kalimantan (Emiten News). MNCS Comment: We assess the acquisition positively as it adds portfolio diversification beyond energy and resources operations. Through this acquisition, we expect it to act as a buffer amid commodity price fluctuations and drive the company's performance forward. Currently, ITMA is traded at a level of 21.05x/0.18x PER/PBV.
IHSG Updates
The JCI strengthened by +0.21% to 7,190.99 on Friday (15/12), followed by significant net foreign buy of IDR3.88 trillion. Most sectors increased and drove the index up, led by energy sector (+1.59%) and followed by infrastructures sector (+1.47%). On the other hand, some sectors weakened, led by technology sector (-2.66%) and followed by transportation & logistic sector (-1.09%). The index strengthened as investors scrutinized the performance of the domestic trade balance in Nov-2023. Meanwhile, most Asian markets closed higher, supported by the release of China's retail sales data for Nov-2023, which grew +10.1% YoY (vs +7.6% YoY in Oct-2023).l. The Rupiah closed higher at IDR15,493/USD. We estimate the IHSG will move within the price range of 7,130-7,220. Today's Recommendations: BBRI, ERAA, GJTL, TLKM.
Corporate Actions
EGMS : DEWA, JKON
Cum Dividend : PBSA (IDR40/share)
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