MNCS Morning Navigator

25 Januari 2022

MNCS Morning Navigator January 25, 2022

Global Market Highlights

DJIA rose +0.29% on Monday (24/01) followed by S&P 500 (+0.28%) and Nasdaq (+0.63%). The strengthening of Wall Street was supported by the investors’ buying action as well as the release of financial reports that performed beyond expectations, after there was a significant weakening on Wall Street where it touched its lowest level for the last several months. In addition, the yield on the T-note 10y which fell by -1.4 bp to 1.74% after rising geopolitical tensions between Ukraine and Russia also contributed to the strengthening of share prices after previously being pressured, especially in technology stocks. Today, the market will be looking toward several data releases such as: 1) US CB Consumer Confidence; 2) Germany Ifo Business Climate; 3) UK Public Sector Net Borrowing.

Domestic Update
• Indonesia broad money (M2) supply was reported at IDR7,867 trillion on Dec-21 or increased 13.9% YoY. MNCS Comment: Liquidity in the economy remains ample, banking credit started to gradually recover since 1H21, and money velocity had been accelerated, therefore triggered a higher yet benign inflation.
• Furthermore, the second dose of vaccination rate nationally has reached 59.6% or equivalent to 124.10 million people.

Company News
1. INTP IJ recorded cement sales volume in FY21 of 16.6 million tons or up +2.3% YoY. In addition, the company targets sales volume in FY22 to grow 3% - 4% YoY (Business Market). MNCS Comment: We see that the company has succeeded in taking advantage of the momentum of economic recovery to improve the company's performance, especially with the support and good acceleration in the construction and property sectors. We believe the company can continue its good performance in FY22. Currently, INTP is trading at 25.42x/1.90x PER/PBV.
2. TBIG IJ increased the allocation of capital expenditure (capex) FY22E to IDR3 trillion. Meanwhile, the company last year allocated a capex of IDR2 trillion from internal cash and bank loans to be used for organic development (Bisnis Indonesia). MNCS Comment: We see that with the increasing capex in FY22E, the company will be more expansive and is hoped to drive TBIG's performance this year. Currently, TBIG is trading at 46.85x/7.42x PER/PBV.
3. MTEL IJ prepares capital expenditure (capex) of IDR9.9 trillion in FY22E sourced from IPO proceeds of IDR18.8 trillion. With this capex, the company targets to achieve annual revenue growth of around 10% - 11% YoY until FY25E (Investor Daily). MNCS Comment: We see that the company's optimism is driven by the tower industry which is growing amidst the need for internet data during the pandemic. Currently, MTEL is trading at 2.89/0.30x PER/PBV.

IHSG Updates
JCI weakened -1.06% to 6,655.17 on Monday (24/01) followed by net foreign sell which reached IDR2.92 billion. The sector that led the index weakening was the technology sector (-2.89%) followed by the financial sector (-1.42%). On the other hand, the energy sector strengthened +0.68% followed by the transportation sector (+0.60%). The weakening of the index was in line with Wall Street which was triggered by the market concerns regarding the increasingly aggressive hawkish attitude of the Fed where it is estimated that the benchmark interest rate (FFR) will rise 4-5 times this year. Investors are also waiting for the results of the FOMC meeting held by the Fed on 25-26 Jan 2022. In addition, the increasing development of Covid-19 cases (+2,927 positive cases as of 24-Jan) with active cases reaching 20,867 opens the option for PPKM level 3 in the capital city, further suppressing the index rate. On the other hand, the Rupiah weakened at IDR14,343/USD level. We estimate that the JCI will move in the range of 6,600-6,680 while waiting for the FDA and motorbike sales data to be released. Today's recommendations: INTP, BTPS, CTRA, ANTM.

Corporate Action
IPO: ASLC (IDR256/share)

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