MNCS Morning Navigator

16 Juli 2021

MNCS Morning Navigator July 16, 2021

Global Market Highlight
DJIA rose by +0.15% on Thursday (15/07) on the other hand S&P 500 fell by -0.33%, followed by Nasdaq fell by -0.70%. Wall Street closing was mixed as investor concerns that the sustainable inflation could lead to faster than expected tightening of monetary policy. The market will look forward to several data releases today, such as: 1) US Retail Sales MoM; 2) Eurozone Core Inflation Rate YoY Final ; 3) Japan BoJ Interest Rate Decision.


Domestic Update
Car makers industry association (GAIKINDO) recorded an automobile wholesale of 72,720 units in June-21 (+32.7% MoM and 476.1% YoY). Cumulatively domestic car wholesale or sales from factory to dealer for 1H21 has reached 393,469 units (+50% YoY). MNCS comment: The increase of car wholesalers in June-21 and in 1H21 was driven by : 1) low based effect; 2) pent up demand and 3) government relaxation on car luxury tax (PPnBM) as well as 4) BI policy to ease LTV for vehicle ownership to a minimum of 0%. However, we expect FY21 car sales to remain below 1 mn units triggered by limited demand and chip shortage, let alone with the recent implementation of Emergency Public Activity Limitation (PPKM Darurat).
Furthermore, there was an addition of 12,691 new Covid-19 cases in Jakarta yesterday.


Company News
1. BRIS IJ recorded the number of BSI Mobile users reached 2.2 million users in 6M21, besides that BSI Mobile transactions grew 113% YoY in 6M21. BRIS presents a cardless cash withdrawal feature, which is only by using the BSI Mobile application which can be used at 17,800 Indomaret outlets and more than 1,800 BSI ATMs throughout Indonesia (IQ Plus).MNCS Comment: We believe that BRIS will continue to focus on developing sharia mobile banking super apps where management plans to add several features such as paylater. In addition, digital initiatives through open banking will open up opportunities for collaboration with several e-commerce companies. Currently BRIS is trading at 33.06x/4.36x PE/PBV levels.

2. KRAS IJ with the Minister of SOEs inaugurated the subholding of PT Krakatau Sarana Infrastruktur (KSI). The company manages industrial estates with integrated services such as infrastructure, port areas, roads, electricity, water and gas as well as other supporting facilities such as hotels and housing. Until FY20 KSI recorded IDR3.4 trillion revenu, and projected it will increase revenue to IDR7.8 trillion in the next five years (Bisnis Indonesia). MNCS Comment: Although the industrial area is still a business affected by Covid-19, we assess that KSI has the potential to become a new source of revenue driven for KRAS. This is because the integrated industrial area has the potential to be absorbed if the economy returns to normal. Currently KRAS is trading at 7.48x/1.03x PE/PBV levels.

3. MPPA IJ plans to conduct a private placement with a maximum number of 752.91 million shares or 10% of the total issued and paid-up shares. It is estimated that the funds that MPPA will get are around Rp. 670.84 billion (CNBC Indonesia). MNCS Comment: We expect this corporate action to be carried out to strengthen the balance sheet structure, working capital and offline and online business development. The partnership with Gojek in launching 31 virtual stores supports MPPA's online business, especially in the midst of the pandemic situation. Currently MPPA is trading at 44.64x PBV levels.


IHSG Updates
JCI rose by +1.13% to 6,046.75 on Thursday (15/07) followed by net foreign buy reaching IDR555.34 billion. JCI closing was higher along with most sectors led by industrial (+2.07%), followed by finance (+1.81%). On the other hand, the transport sector slipped by -0.14% followed by basic-industry (-0.06%). JCI strengthened due to data surplus on national trade balance periode June-21 of USD1.32 billion. Meanwhile the Rupiah exchange rate was weakening at IDR14,483. We estimate the JCI will move in the range of 6,010-6,080 while waiting for the interest rate decision. Today's recommendation: DOID, BBRI, TINS, WSKT.


Corporate Action
Cum Dividend Date : GGRM (IDR2.600/share), ASRM (IDR46/share), INTP (IDR500/share)

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