Global Market Highlights
DJIA weakened by -0.52% on Monday (11/07), followed by the S&P 500 (-1.15%) and the Nasdaq (-2.26%). Wall Street was depressed along with investor concerns about the possibility of a lockdown in China which could hamper the pace of global economic growth. Furthermore, investors also tended to wait and see for the release of the Q2 financial reports and the Jun-22 inflation data where the consensus estimated that inflation would grow +8.8% YoY. Today, the market will be looking toward several data releases such as: 1) US Fed Barkin Speech; 2) Germany ZEW Economic Sentiment Index; 3) Germany ZEW Current Conditions.
Domestic Update
• Indonesia retail sales grew 2.9% YoY in May and is projected to increase by 15.9% YoY in Jun-22. MNCS Comment: The positive performance of retail sales was due to mobility & economic improvement as well as the momentum of the Eid al-Fitr holiday. Going forward, respondents also expect that inflationary pressure will decrease for the next 3 and 6 months along with expedited goods distribution.
• Furthermore, the national Covid-19 daily rate had increased by 1,681 active cases (11/07).
Company News
1. DMAS IJ achieved marketing sales of IDR995 billion in 1H22 or equivalent to 55.3% realization of the FY22E target of IDR1.8 trillion. This income was supported by sales of industrial land and sales of commercial and residential products (IQ plus). MNCS Comment: This achievement was an increase of +9.94% YoY compared to the marketing sales in 1H21 of IDR905 billion. Meanwhile, the target for marketing sales in FY22E had decreased compared to FY21 of IDR 2 trillion. We see that the company was more realistic in FY22E where the realization of marketing sales in FY21 is IDR 1.76 trillion. Currently, DMAS is traded at 4.98x/1.35x PER/PBV levels.
2. KRAS IJ projected a net profit growth of +89.6% YoY in 1H22, supported by an increase in sales volume by +10.5% YoY from 995 thousand tons to 1,099 thousand tons as production increased by +10.2% YoY to 1,111 thousand tons (vs 1,008 thousand tons in 1H21) (Investor ID). MNCS Comment: We see that the company's downstream sector continued to grow along with the increasing demand for products that were affected by the Russia-Ukraine geopolitical conflict as well as high selling prices supporting the company's performance. KRAS is currently traded at 4.46x/0.66x PER/PBV levels.
3. TINS IJ reported that exploration costs in 2Q22 reached IDR47.59 billion, of which exploration was focused on tin. Meanwhile, the exploration plan in the 3Q22 was for evaluation and continuing activities from the previous month (Emiten News). MNCS Comment: Exploration costs in 2Q22 increased by +9.55% QoQ compared to 1Q21 accumulation which reached IDR43.44 billion. It is hoped that through this exploration, it could increase the company's resources and reserves where in FY21, the company's resources and reserves increased by +12% YoY and +6% YoY, respectively. Currently, TINS is traded at 4.10x/1.41x PER/PBV levels.
IHSG Updates
JCI weakened by -0.27% to 6,722.14 on Monday (11/07), followed by net foreign sell which reached IDR202.76 billion. A number of sectors experienced weakening, led by the technology sector (-0.92%) followed by the non-cyclical sector (-0.43%). On the other hand, the sectors that experienced strengthening were led by the health sector (+2.12%) followed by the transportation sector (+1.18%). The weakening of the index occurred amid the release of retail sales data for May-22 which recorded grew +2.91% YoY. On the other hand, the Rupiah exchange rate closed higher at IDR14,973/USD. We estimate the JCI will move in the price range of 6,678-6,800. Today's recommendation: ASII, BBCA, ENRG, INKP.
Corporate Action
RUPS: FREN, BTON, TRUK
Disclaimer On
