Global Market Highlights
DJIA fell -0.73% on Thursday (09/02), followed by the S&P500 (-0.88%) and the Nasdaq (-1.02%). Wall Street continued to weaken as the yield on the US T-note 10Y rose to a level of 3.67%. In addition, investors were also paying close attention to the release of initial jobless claims data as of February 4, 2023 which was recorded at 196k, or higher than the consensus/previous, namely 190k/183k, respectively. Today, the market will be looking toward several data releases such as: 1) US Michigan Consumer Sentiment Prel Feb; 2) UK GDP YoY Dec; 3) UK GDP Growth Rate YoY Prel Q4.
Domestic Update
• Indonesia's retail sales performance in Dec-2022 grew +0.7% YoY, slower than the Nov-2022 realization of +1.3% YoY. MNCS Comment: This slowdown was in line with the performance of fuel sales which fell -10.4% YoY followed by household equipment -10.2% YoY. Meanwhile, the performance of information and communication equipment sales grew +16.6% YoY, in line with the reopening of China which has overcome supply chain disruptions.
Company News
1. UNVR IJ posted a net profit of IDR5.4 trillion in FY22, or decreased -6.8% YoY (vs IDR5.8 trillion) (Kontan). MNCS Comment: Lower net profit in FY22 amidst +4.23% YoY increase in revenue as COGS increase (+11.2% YoY) weighed on gross profit performance (-2.9% YoY), as well as increase in selling expenses +7.5% YoY thereby reducing operating profit performance -7.9% YoY. In terms of margin, OPM/NPM fell to 17.1%/13.0% respectively (vs 19.4%/14.5% in FY21). Currently, UNVR is traded at the level of 30.53x/32.75x PER/PBV.
2. MIDI IJ planned to conduct a right issue by issuing 4.6 billion new shares with a nominal value of IDR10/share (Emiten News). MNCS Comment: The additional capital will be used for working capital and business development including investment in corporate entities. Therefore, it has the potential to increase the number of outlets owned, where up to 9M22, the total outlets owned reached 2,094 outlets. It is hoped that through the expansion of outlets in the future, it can boost the company's performance. Currently, MIDI is traded at the level of 29.69x/6.63 PER/PBV.
3. SMRA IJ targeted IDR5 trillion in marketing sales in FY23E (Kontan). MNCS Comment: The nominal target is the same as FY22 with realization reaching IDR4.9 trillion (98.9%). We view a conservative marketing sales target in line with the FY23E political year which resulted in a flat marketing sales performance and an increase in mortgage rates. Currently, SMRA is trading at the level of 24.79x/1.15x PER/PBV.
IHSG Updates
JCI weakened -0.62% to 6,897.36 on Thursday (09/02), followed by net foreign buy reaching IDR717.09 billion. The majority of sectors experienced weakness and weighed on the index, led by the technology sector (-4.00%) followed by the energy sector (-1.37%). On the other hand, sectors that experienced strengthening were led by the financial sector (+0.16%) followed by the non-cyclical sector (+0.03%). The index's weakness was in line with Wall Street. We see that the movement of the index was overshadowed by negative global sentiment in the form of the hawkish attitude of the Fed, as well as investors who were watching the retail sales performance in December 2022 which grew slower +0.7% YoY (vs +1.3% YoY in Nov-2022) in line with the increase benchmark interest rate. On the other hand, the Rupiah exchange rate closed higher at the level of IDR15,095/USD. We estimate that the JCI will move in the price range of 6,862-6,932. Today's recommendation: ASII, CARS, HRUM, TBIG.
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