Global Market Highlights
US indices closed on Friday (24/12) during the holiday of Christmas WTI Crude Oil strengthened by (+1.42%) to USD73.79/Bbl in last trading week (23/12) with the catalysts came from the granting of Emergency Use Authorization (EUA) for Covid-19 antivirus (Paxlovid) and research studies on the effect of the Omicron variant which tends to be lighter than Delta. Today, the market will be looking toward several data releases such as: 1) China Industrial Profits (YTD) YoY; 2) Japan Retail Sales YoY; 3) US Dallas Fed Manufacturing Index.
Domestic Update
• Foreign flows transaction data throughout 20-23 December 2021 reported that non-resident investors have booked a net selling of IDR130 billion in the domestic market according to BI. MNCS Comment: The net sell was reported in equity market of IDR210 billion while foreign investors booked a net buy in government bond market amounted at IDR80 billion. We think that outflows were quite small so that domestic financial market remained solid.
• Furthermore, the second dose of vaccination rate nationally has reached 53.1% or equivalent to 110.52 million people.
Company News
1. PTPP IJ targets new contracts to reach IDR31 trillion in FY22E or up +26% YoY (vs IDR24.6 trillion in FY21E). As of 11M21, PTPP recorded new contracts of IDR16.5 trillion, or equivalent to 67.1% of the FY21E target (Kontan). MNCS Comment: We see that the company is optimistic to achieve its target next year, despite the decline in the government’s infrastructure budget. For this reason, PTPP pursues development projects not only from the central and local governments but also from the private sector. In FY21E, the company calculates that it will get a contract in the range of 90% of the target. PTPP is trading at the level of 35.21x/0.57x PER/PBV.
2. PTRO IJ targets a capex of USD138 million for FY22E. 40% of the funds are allocated for capital expenditures and 60% for additional capacity through projects in Kideco, KSM, and Freeport (Kontan). MNCS Comment: PTRO is optimistic that it can achieve a better performance next year, by implementing a 3D strategy (Diversification, Digitization, and Decarbonization) by targeting metal mining that has the potential to increase demand in the future. Currently, PTRO is trading at level 8.11x/0.65x PER/PBV.
3. WSKT IJ plans to divest 4-5 toll roads in FY22E. The divestment will be carried out on the Depok-Antasari, Cimanggis-Cibitung, Bogor-Ciawi-Sukabumi, and Pemalang-Batang toll roads (Bisnis Indonesia). MNCS Comment: We view the company’s divestment action as on the steps taken by WSKT to the restructuring process which is expected to be completed in FY25E. WSKT trading at the level of 30.82x/1.32x PER/PBV.
IHSG Updates
JCI rose slightly by +0.11% to 6,562.90 on Friday (24/12) followed by net foreign buy which reached IDR205.53 billion. Several sectors supported the index, led by the cyclical sector (+2.20%) followed by the energy sector (+1.54%). On the other hand, the transportation sector weakened by (-1.59%) followed by the technology sector (-0.85%). Trading day opened higher until the end of the first session, although it weakened to negative territory in the second session. Therefore, it can be concluded that the effects or symptoms caused by the Omicron variant are lighter compared to Delta. Meanwhile, the Ministry of Health recorded the addition of domestic Omicron cases to 46 active cases on Sunday. On the other hand, Rupiah closed higher at IDR14,221/USD level. We estimate that the JCI will move in the range of 6,529-6,600. Today's recommendations: MMLP, TOWR, LPPF, ELSA.
Corporate Action
Public Expose: MDRN
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