MNCS Morning Navigator

10 Maret 2023

MNCS Morning Navigator March 10, 2023

Global Market Highlights
DJIA fell -1.66% on Thursday (09/03), followed by the S&P500 (-1.85%) and the Nasdaq (-2.05%). Wall Street closed lower, where investors responded negatively to the release of data on initial jobless claims per 4-Mar'2023 which rose to 211k, or higher than consensus and the previous period, namely 195k/190k. Today, the market will be looking toward several data releases such as: 1) US Non Farm Payrolls Feb; 2) US Unemployment Rate Feb; 3) UK GDP YoY Jan.

Domestic Update
• The Real Sales Index for Feb-2023 is projected to increase +2.6% YoY to a level of 205.2 (vs -0.6% YoY in Jan-2023) and will peak in April ahead of Ramadhan and Idul Fitri. MNCS Comment: We view the rise of retail sales to provide a positive stimulus for the Indonesian economy this year, considering that retail consumption accounts for 57% of GDP.

Company News
1. ARNA IJ will distribute a cash dividend of IDR55 per share from net profit for the FY22 fiscal year (Kontan). MNCS Comment: Therefore, ARNA will offer a dividend yield of 5.4%. Meanwhile, the payout ratio in FY22 reached 70.1%. The dividend size increased +22.2% YoY and in line with the increase in net profit (+22.4% YoY). Currently, ARNA is traded at the level of 12.93x/4.13x PER/PBV.
2. PTBA IJ targets a growth in coal production in FY23E of +11% YoY to 41 million tonnes, followed by a target of increasing sales to 41.2 million tonnes (+30% YoY) (Kompas). MNCS Comment: We view that the La Nina climate, which has minimal impact this year, will support coal exploitation activities. In addition, the development of railroad logistics facilities which are increased by 20 million tons can help the company to achieve this target. Currently, PTBA is traded at the level of 3.61x/1.58x PBV.
3. LINK IJ recorded a decrease in net profit -72.8% YoY to IDR240.7 billion in FY22 (vs IDR885.3 billion in FY21) (Emiten News). MNCS Comment: The decline in net profit was in line with: 1) decreased revenue (-2.1% YoY); 2) increase in depreciation expenses (+28.8% YoY); 3) increase in OPEX (+25.2% YoY); 4) as well as an increase in financial expenses (+40.7% YoY). Currently LINK is trading at the level of 26.64x/1.29x PER/PBV.

IHSG Updates
JCI strengthened +0.35% to 6,799.79 on Thursday (09/03), followed by net foreign buy reaching IDR606.08 billion. A number of sectors experienced strengthening and boosted the index rate, led by the transportation sector (+1.64%) followed by the health sector (+1.12%). On the other hand, sectors that experienced weakness were led by the non-cyclical sector (-0.43%) followed by the property sector -0.12%. The index's gain was in line with Wall Street and most Asian exchanges, as investors' fears of the Fed's hawkish stance at the FOMC Mar-2023 eased. Investors were also watching for a slowdown in China's Feb-2023 inflation rate to +1% YoY, or lower than the consensus/Jan-2023 of +1.9% YoY/+2.1% YoY. On the other hand, the Rupiah exchange rate closed higher at the level of IDR15,425/USD. We estimate that the JCI will move in the price range of 6,760-6,817. Today's recommendation: ASII, BBTN, TBIG, TLKM.

Corporate Actions
IPO: NSSS (IDR127/share)

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