Global Market Highlights
DJIA strengthened by +1.12% on Thursday (07/07), followed by S&P 500 (+1.50%) and Nasdaq (+2.28%). Wall Street strengthened amid the release of initial jobless claims data as of 2-Jul of 235,000 or increased from the previous 231,000, as well as the May-22 trade balance which shrank its deficit to USD85.5 billion (vs deficit of USD87.1 billion in Apr-22). The catalyst driving the index rate was the issuance of a stimulus by the Chinese government to encourage global economic growth, which the investors responded positively. Today, the market will be looking toward several data releases such as: 1) US Non Farm Payrolls; 2) US Unemployment Rate; 3) France Balance of Trade.
Domestic Update
• The Ministry of Finance had disbursed a budget of IDR23.3 trillion aimed for the 13th salary of civil servants and pensioners until Tuesday (5/7) from the target of IDR35.5 trillion. MNCS Comment: We view the disbursement of the 13th salary could be a positive catalyst for domestic consumption and benefit several sectors such as consumer non-cyclicals and retail.
• Furthermore, the national Covid-19 daily rate had increased by 2,881 active cases (07/07).
Company News
1. SMRA IJ would distribute cash dividends of IDR99 billion or equivalent to IDR6 per share. Furthermore, FY21 net profit was recorded to be IDR550 billion, greater than FY20 net profit of IDR246 billion (Market Bisnis). MNCS Comment: SMRA would distribute a dividend yield of 1.06%, with a net profit attributable to the parent company of IDR323.71 billion with the payout ratio reaching 30.58%, while the company in FY20 and FY21 did not distribute any dividends. SMRA is currently traded at 13.32x/1.06x PER/PBV.
2. WSKT IJ recorded a new contract value of IDR114 billion for the rehabilitation and reconstruction project of flood control buildings in the city of Bima, while the project was carried out for 193 calendar days (Emiten News). MNCS Comment: Up to 5M22, the company had booked a new contract value of IDR7.99 trillion through the addition of the project together with the Citarum river irrigation network rehabilitation project worth IDR517 billion. Thus, the estimated value of the company's new contract reached IDR8.62 trillion. Currently, WSKT is traded at 1.43x PBV.
3. WTON IJ reported revenue in 1Q22 of IDR773.19 billion (vs IDR641.78 billion in 1Q21) meanwhile, net profit was recorded at IDR18.02 billion, below 1Q22 net profit of IDR23.19 billion (Kontan). MNCS Comment: Revenue growth was supported by the concrete segment which increased +29.78% YoY to IDR701.29 billion and contributed 90.7% to the total revenue. GPM and OPM increased to 9.93% and 6.57%, respectively (vs 0.17% and -3.86% in 1Q21). The decrease in net income was in line with the increase in interest expense, the decrease in the value of financial instruments as well as the increase of tax rate to 22.13% (vs 6.18% in 1Q21). Currently, WTON is traded at the level of 21.44x/0.53x PER/PBV.
IHSG Updates
JCI strengthened by +0.09% to 6,652.58 on Thursday (07/07), followed by net foreign sell which reached IDR666.86 billion. The majority of sectors experienced strengthening and boosted the index rate, led by the technology sector (+1.92%) followed by the transportation sector (+1.79%). On the other hand, the weaker sector was led by the industrial sector (-0.19%) followed by the energy sector (-0.15%). Positive catalyst came from Bank Indonesia (BI) which reported that the foreign exchange reserves in June-22 increased by +USD800 million to USD136.4 billion. The increase was supported by the issuance of government global bonds as well as tax and service revenues. On the other hand, the Rupiah exchange rate closed higher at IDR14,996/USD. We estimate that the JCI will move in the price range of 6,600-6,700 pending the release of Consumer Confidence JUN data and G20 Foreign Ministers Meeting. Today's recommendation: ADMR, GOTO, LPPF, WIRG.
Corporate Action
Cum Dividend: GGRM (IDR2,250/share), PNLF (IDR10/share), IPCC (IDR23.12/share)
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