MNCS Morning Navigator

14 Maret 2023

MNCS Morning Navigator March 14, 2023

Global Market Highlights
DJIA weakened -0.28% on Monday (13/03), followed by S&P500 (-0.15%) while Nasdaq (+0.45%). Wall Street closed mixed, where investors were still watching developments in Silicon Valley Bank and the decline in UST yields to 3.58% became positive sentiment for the Nasdaq. Today, the market will be looking toward several data releases such as: 1) US Core Inflation Rate YoY Feb; 2) US Inflation Rate YoY Feb; 3) UK Unemployment Rate Jan.

Domestic Update
Automotive sales in Indonesia experienced growth in Feb-2023 from the previous year, which rose 7.3% YoY for cars and 50% YoY for motorcycles. MNCS Comment: We see that the significant incline in sales indicate strengthening national economic conditions and a rising need for vehicles with the elimination of the PPKM Covid-19 protocol and the full implementation of WFO.

Company News
1. BBRI IJ plans to distribute cash dividends for the FY22 fiscal year of IDR43.5 trillion, or the equivalent of a payout ratio of 85% of net profit (Investor ID). MNCS Comment: We estimate that the amount of DPS for the FY22 fiscal year is IDR288.2/share taking into account treasury shares. Deducted with the interim dividend of IDR57/share, the potential DPS reach IDR231.2/share, or the amount of dividend yield can be reached 6.0% for FY22. Currently, BBRI is traded at the level of 2.45x PBV.
2. INKP IJ recorded a net profit of USD857.5 million, or grew +62.9% YoY (vs USD526.4 million in FY21) (Kontan). MNCS Comment: The increase in net profit was supported by an increase in revenue +13.8% YoY, in line with the increase in revenue from the cultural paper and pulp segments of +31.3% YoY/+17.9% YoY, respectively. Furthermore, margins were recorded as expansive, where OPM/NPM was at 28.4%/21.4% (vs 24.4%/15.0% in FY21). Currently, INKP is traded at the level of 3.04x/0.47x PBV.
3. LPPF IJ targets IDR500 billion capex allocation in FY23E (Kontan). MNCS Comment: The amount of capex allocation is relatively the same as FY22, in line with the company targeting to open 12-15 outlets (vs 10 outlets in FY22). We also have a positive view that the company is targeting to open 7 new outlets before Lebaran (2 outlets have already been realized), which can increase more seasonal revenue than the previous year. Currently, LPPF is traded at the level of 8.46x/20.17x PER/PBV.

IHSG Updates
JCI strengthened +0.32% to 6,786.95 on Monday (13/03), followed by net foreign buy reaching IDR29.81 billion. A number of sectors experienced strengthening and supported the index, led by the energy sector (+1.17%) followed by the industrial sector (+0.38%). On the other hand, sectors that experienced weakness were led by the transportation sector (-1.51%) followed by the raw materials sector (-1.40%). The index strengthened as investors' concerns eased after the fall of Silicon Valley Bank, and could soften the Fed's monetary policy not to be aggressive in raising US benchmark interest rates. On the other hand, the Rupiah exchange rate closed higher at the level of IDR15,365/USD. We estimate that the JCI will move in the price range of 6,745-6,800. Today's recommendation: ACES, BUMI, ISAT, UNTR.

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