MNCS Morning Navigator

05 Januari 2023

MNCS Morning Navigator January 5, 2023

Global Market Highlights
DJIA strengthened +0.40% on Wednesday (04/01), followed by the S&P500 (+0.75%) and the Nasdaq (+0.69%). Wall Street strengthened as the UST yield decreased to 3.7%. In addition, investors arweree also paying attention to the release of labor market data which tends to be solid, where JOLTs Job Openings in Nov-2022 reached 10.46 million, or above the consensus estimate of 10 million. Today, the market will be looking toward several data releases such as: 1) US Balance of Trade Dec; 2) US S&P Global Composite PMI Final Dec; 3) US ADP Employment Change Dec.

Domestic Update
• State revenue for the 2022 State Budget reached IDR2,624.4 trillion or reached 115.9% of the target set in Presidential Decree No. 98/2022 of IDR2,266.2 trillion. MNCS Comment: The higher-than-target state revenue was driven by achievements from all sources of income: 1) taxes (115.6% target); 2) customs & excise (106.3% target) and 3) PNBP (122.2%) which shows a solid Indonesian economy throughout 2022 amidst persistently high commodity prices.

Company News
1. AKRA IJ targets net profit growth of +15% YoY in FY23E (Investor ID). MNCS Comment: We project the company's revenue and net profit in FY23E to be IDR47.7/IDR2.2 trillion, respectively. This will be supported by: 1) capex allocation of IDR486.0 billion; 2) increasing fuel distribution; 3) sale of JIIPE land. Currently, AKRA is being traded at the level of 12.42x/2.56x PER/PBV.
2. ANTM IJ reports that the Ferronickel plant construction process in East Halmahera has reached 98% and is ready to operate in 2H23 (Market Bisnis). MNCS Comment: The capacity of the Ferronickel plant in East Halmahera is 13,500 TNi/year. Thus, it has the potential to increase ANTM’s total Ferronickel processing capacity to 40,500 TNi/year. It is hoped that this additional capacity can boost the company's performance going forward. Currently, ANTM is traded at the level of 14.07x/2.18x PER/PBV.
3. IPCC IJ targets a capex allocation in FY23E of IDR35-40 billion (Emiten News). MNCS Comment: The projected capex grows +42-62% YoY from FY22E of IDR24.65 billion. The majority of the capex portion will be used for the repair and development of the company's infrastructure. We also see this as an effort to anticipate an increase in vehicle volume in FY23E, where GAIKINDO projects domestic car sales of 975k units (vs 960k units in FY22E). Currently, IPCC is traded at the level of 7.01x/0.90x PER/PBV.

IHSG Updates
JCI weakened -1.10% to 6,813.24 on Wednesday (04/01), followed by net foreign sell which reached IDR432.28 billion. The majority of sectors experienced weakening and weighed on the index, led by the energy sector (-3.20%) and followed by the industrial sector (-2.12%). On the other hand, the sectors that experienced strengthening were the technology sector (+0.24%). The weakening of the index was in line with the weakening of Wall Street. We see investors responding negatively to the announcement of the US manufacturing PMI in Dec-2022 which decreased to 46.2 points (vs 47.7 points in the Nov-2022 realization). On the other hand, the Rupiah exchange rate closed higher at the level of IDR15,588/USD. We estimate that the JCI will move in the price range of 6,760-6,834. Today's recommendation: BBRI, HRUM, INDF, SIDO.

Corporate Actions
Cum Stock Split: SKRN (1:5)

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