Global Market Highlights
The DJIA weakened by -0.19% on Wednesday (06/12), followed by S&P500 (-0.39%) and Nasdaq (-0.58%). Wall Street corrected amidst growing investor optimism anticipating a dovish stance from The Fed in the future, driven by the release of Nov-2023 ADP employment change data that fell below expectations. Negative sentiment arose from the contraction in oil inventories, pushing energy stocks into negative territory and burdening index movement. Today, the market will be looking toward several data releases such as: 1) China Balance of Trade Nov-23; 2) EU GDP Growth Rate QoQ 3rd Est Q3; 3) US Initial Jobless Claims Dec/02.
Domestic Update
The government plans to increase Bulog's rice reserve to 3 million tons. MNCS Comment: We see the addition of rice reserves positively to address disruptions in supply, given the impact of post-El Nino. We see the potential for increased demand ahead of the festive season in 1H24, coinciding with the election momentum. Thus, we anticipate an increase in import quotas to reach 1.5 million tons in 1Q24, to curb the +16% YTD rise in rice prices.
Company News
1. BFIN IJ will distribute an interim dividend of IDR421.1 billion, equivalent to IDR28 per share (Emiten News). MNCS Comment: Therefore, we estimate that BFIN will offer a dividend yield of 2.4%. With a net profit of IDR1.2 trillion in 9M23 (vs IDR1.3 trillion in 9M22), the payout ratio reaches 35.8%. Currently, BFIN is traded at a level of 11.71x/1.95x PER/PBV.
2. TOWR IJ will distribute an interim dividend of IDR298.8 billion, equivalent to IDR6 per share (Emiten News). MNCS Comment: Therefore, we estimate that TOWR will offer a dividend yield of 0.5%. With a net profit of IDR2.4 trillion in 9M23 (vs IDR2.6 trillion in 9M22), the payout ratio reaches 12.3%. Meanwhile, we expect a final dividend for the FY23E of IDR18.1 per share, considering historical factors. Currently, TOWR is traded at a level of 14.99x/3.04x PER/PBV.
3. EXCL IJ will gain 750k customers and the development of 2 million home passed by LINK IJ to support FBB and FMC services (Emiten News). MNCS Comment: We assessed this as a positive strategic move by EXCL to accelerate FBB and FMC services, strengthening their competitive advantage amid industry competition. With efficient infrastructure access from LINK, we anticipate an improvement in EXCL's performance ahead. Currently, EXCL is traded at a level of 20.85x/1.08x PER/PBV.
IHSG Updates
The JCI weakened by -0.19% at 7,087.84 on Wednesday (06/12), followed by a net foreign sell of IDR624.33 billion. Most of the sectors went down and pressured the index, led by the technology sector (-2.99%) and followed by the properties sector (-1.36%). In contrast, sectors experiencing gain were led by the infrastructures sector (+2.83%), followed by basic materials sector (+2.78%). The index weakened amid an Asian market rebound, whereas investors tend to wait and see ahead of the release of Nov-2023 domestic foreign exchange reserve data. Meanwhile, the Asian markets rebound as investors reacted positively on the US labor-market data, fostering market expectations for The Fed to implement a rate cut in 1H24. We estimate the IHSG will move within the price range of 7,040-7,120. Today's Recommendations: AMMN, ERAA, RAAM, ULTJ.
Corporate Actions
EGMS : AVIA, BTPN
Cum Dividend : POWR (IDR29.5/share)
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