MNCS Morning Navigator

11 Juli 2024

MNCS Morning Navigator July 11, 2024

Global Market Highlights
The DJIA climbed by +1.09% on Wednesday (10/07), followed by the S&P 500 (+1.02%) and followed by the Nasdaq (+1.18%). Wall Street closed on a solid gain after Fed Chair, Powell, indicated some signal of soft-landing during his second day of testimony at the Congress. Following this, markets raise the expectations of a rate cut agenda in Sep-2024, while also waiting for the inflation data reading today. Today the market will be looking forward to several data releases such as: 1) US Inflation Rate Jun-2024; 2) US Initial Jobless Claims Jun/06; 3) GB GDP May-2024.

Domestic Update
AISI reported the motorbike sales in Indonesia reached 511k in Jun-2024 (vs 506k units in May-2024). MNCS Comment: This achievement indicated a recovery at 3.5% YoY growth from -4.5% YoY fall in the previous month. Meanwhile, on a monthly basis, the sales represented a softer growth of 1.1% MoM, compared to 17.1% MoM in May-2024. The performance was influenced by the normalization of activities post-Ramadan. We note that on a YTD basis up to Jun-2024, the number of motorbikes sold in Indonesia has reached 3.2 million units, reflecting ~48.8-51.1% of the forecast in FY24E at 6.2-6.5 million units (vs 6.2 million units sold in FY23).

Company News
1. AMIN IJ will distribute dividends amounting to IDR5.4 billion or equivalent to IDR5/share (Emiten News). MNCS Comment: After five years not distributing dividends, the company decided to distribute dividends in line with a jump in net profit of +94.9% YoY driven by an increase in revenue of +54.6% YoY in 1Q24. This dividend distribution will provide a potential yield of approximately ~2.6% with payout ratio of 34.9%. Cum dividend in the regular market and negotiated market on July 15th, 2024. AMIN is currently trading at 11.07x/1.21x PER/PBV.
2. POLU IJ managed to record a net profit of IDR3.9 billion in 1Q24 (Emiten News). MNCS Comment: Amidst a decline in revenue of -54.5% YoY, the company managed to record a net profit of IDR 3.9 billion in 1Q24 (vs. a net loss of IDR 15.0 billion in 1Q23) driven by a drop in revenue cost (-56,8% YoY) and OPEX (-82.1% YoY). This resulted in positive GPM/NPM, at 17.7%/9.8% respectively in 1Q24 (vs. 17.1%/-15.0% in 1Q23). POLU is currently trading at 18.92x/2.37x PER/PBV.
3. TINS IJ has spent a budget amounting to IDR38.7 billion for exploration activities in 2Q24 (Emiten News). MNCS Comment: The total funds used for exploration activities in 2Q24 was lower than the previous year, amounting to IDR 40.1 billion in 2Q23 (-3.5% YoY). Management explained that offshore exploration activities at sea include detailed drilling in both Bangka and Kundur waters with a total drill of 7,767.8 meters. Meanwhile, the onshore exploration including geomagnetic survey mapping & tin drilling and scout drilling in Bangka and Belitung with a total drill of 636.3 meters. TINS is currently trading at 1.13x PBV.

IHSG Updates
The JCI rose by +0.24% to 7,287.04 on Wednesday (10/07), amidst a net foreign sell of IDR168.85 billion. Several sectors experienced gains and drove the index upward, led by the industrial sector (+0.52%) and followed by the consumer non-cyclical sector (+0.45%). Meanwhile, the sectors that weakened were led by the technology sector (-0.71%) and followed by the financial sector (-0.31%). The index strengthened amid mixed closures in Asian markets, as investors remained optimistic ahead of the release of global macroeconomic data, with US inflation for Jun-2024 expected to moderate. Additionally, investors noted the rebound in 2W sales, which increased by +3.5% YoY in Jun-2024. This reflects the solid purchasing power of the mid-low class. The Rupiah closed higher at IDR16,240/USD. We estimate that the JCI will move in the price range of 7,267-7,317. Today's recommendations: BBCA, MIDI, SMGA, TKIM.

Corporate Actions

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