Global Market Highlights
DJIA weakened by -0.42% on Tuesday (05/07), while S&P 500 (+0.16%) and Nasdaq (+1.75%) Wall Street closed mixed, a positive catalyst came from the release of May-22 factory orders data which grew +1.6% MoM exceeded consensus at 0.5%. Meanwhile, the market was still worried about the potential for an economic recession amid the Fed's monetary tightening. Meanwhile, the weakening of the US T-Note 10Y yield to the level of 2.82% managed to push Wall Street's pace. Today, the market will be looking toward several data releases such as: 1) US ISM Non-Manufacturing PMI; 2) US S&P Global Composite PMI Final; 3) UK S&P Global/CIPS Construction PMI.
Domestic Update
• The government has issued 7 series of SUN with an awarded value of IDR13.80 trillion and incoming bids of IDR25.98 trillion on Tuesday (05/07). MNCS Comment: Despite setting the indicative target lower from IDR20-30 trillion to IDR15-22.5 trillion, investors' appetite was declining as reflected by lower bids in yesterday's auction (vs IDR35.06 trillion in the previous auction). This was reflected by the fact that investors tend to wait and see as global risks looming over the economy.
• Furthermore, the national Covid-19 daily rate had increased by 2,577 active cases (05/07).
Company News
1. PWON IJ would distribute cash dividends of IDR193 billion or equivalent to IDR4 per share, thus making a payout ratio of 14% of the FY21 net profit of IDR1.38 trillion (CNBC). MNCS Comment: Thus, PWON offers a dividend yield of 0.9%. The company returned to distribute dividends after previously not distributing any dividends in FY20 and FY21, while the amount of dividends decreased from IDR7 in FY19 as the company's net profit did not match the pre-pandemic level in FY18 of IDR2.71 trillion. Currently, PWON is traded at 14.88x/1.34x PER/PBV.
2. PNLF IJ would distribute cash dividends of IDR320.22 billion or equivalent to IDR10 per share with the cum date on 8-Jul 22 on both the regular and negotiations markets (IQ plus). MNCS Comment: Therefore, PNLF offers a dividend yield of 2.50%. After 17 years, the company finally distributed dividends where the last dividend was distributed in FY05 of IDR4 per share, or with the addition of an interim dividend of IDR11 per share in FY04 to IDR15 per share. PNLF is currently traded at 0.48x PBV.
3. DMMX IJ targeted revenue growth for FY22E of +100% YoY, supported by the company's expansion into the digital segment. One of which was the commerce & trade marketing platform for retail, which would strengthen the value proposition of the company's ecosystem for which the ecosystem covered 20,000 modern retailers and 130,000 MSMEs (Kontan). MNCS Comment: With this target, the company has the potential to book revenue in FY22E of IDR2.3 trillion. In 1Q22, the company's revenue grew +209.71% YoY to IDR559.59 billion or equivalent to 24.32% of the target set. DMMX is currently traded at 456.60x/13.01x PER/PBV.
IHSG Updates
JCI strengthened by +0.97% to 6,703.27 on Tuesday (05/07), followed by net foreign sell which reached IDR575.98 billion. All sectors strengthened and pushed up the index, led by the energy sector (+4.08%) followed by the industrial sector (+2.04%). The strengthening of the index was in line with other Asian bourses. Investors were also watching the release of China's Caixin Services PMI data for the month of June-22 which expanded its expansion to the level of 54.5 points (vs 41.4 points in May-22), as mobility recovers after the lockdown. On the other hand, the Rupiah exchange rate closed lower at IDR14,988/USD. We estimate that the JCI will move in the price range of 6,600-6,730. Today's recommendation: BIRD, BUMI, ESSA, MPMX.
Corporate Action
Cum Dividend: MYOR (IDR21/share), UNIC (IDR100/share), DVLA (IDR75/share)
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