MNCS Morning Navigator

14 Maret 2024

MNCS Morning Navigator March 14, 2024

Global Market Highlights
The DJIA climbed up by +0.10% on Wednesday (13/03), while S&P 500 (-0.19%) and Nasdaq (-0.54%) experienced corrections. Wall Street closed mixed as UST yields rose to 4.19%, triggering a sell-off in technology stocks. Additionally, investors tended to wait and see ahead of the release of other macroeconomic data. Today, the market will await several data releases, including: 1) US PPI MoM Feb-2024; 2) US Retail Sales MoM Feb-2024; 3) US Initial Jobless Claims Mar/09.

Domestic Update
Bank Indonesia released the survey of Consumer Confidence (IKK) at 123.1 in Feb-2024 (vs 125.0 in Jan-2024). MNCS Comment: The index hits its lowest point since Sept-2023, but remains above the optimistic zone (>100). This result is driven by the rising Consumer Expectation Index (IEK) at 135.3 (vs 134.5 Jan-2024) and the Current Economic Condition Index (IKE) at level 112.1, which weakened but remained optimistic. The growth of IEK is supported by the Income Expectation Index at 138.6 in Feb-2024 (vs 134.8 in Jan-2024) and the Employment Availability Expectation Index at 137.0 in Feb-2024 (vs 133.7 in Jan-2024).

Company News
1. PGAS IJ recorded a decline in net profit of -46.1% YoY to IDR1.6 trillion in FY23 (Kontan). MNCS Comment: We noted that the company's revenue grew +2.17% YoY to reach USD3.6 billion, but this was accompanied by cost of revenue which grew stronger +4.8% YoY to USD2.9 billion. In the future, the company will optimize its portfolio, including revitalizing the Arun LNG terminal so that it becomes the leading LNG Hub in Asia, developing Serivce LNG Bunkering, optimizing the Rokan pipeline and increasing Pangkah production. PGAS is currently trading at 6.58x/0.68x PER/PBV.
2. SMBR IJ recorded an increase in net profit in FY23 to IDR121.6 billion (+57.2% YoY) (Market Bisnis). MNCS Comment: We assess this increase in net profit supported by a revenue growth of +8.4% YoY to IDR2.0 trillion (vs IDR1.9 trillion in FY22). Although gross profit performance decreased by -16.3% YoY due to a COGS increase of +25.6% YoY. The shrank in OPEX by -15.0% YoY and the decrease in financial expenses by -39.4% YoY led to an increase in the company's net profit in FY23. NPM hovered at 6.0% (vs 4.1% in FY22). SMBR is currently trading at 22.88x/0.88x PER/PBV.
3. SMGR IJ reported +6.25% YoY revenue growth at IDR38.65 trillion in FY23 (Kontan). MNCS Comment: Despite a modest increase in the revenue (+6.25% YoY), the company faced a weakening net income growth -8.22% YoY, following a rise of +10.79% YoY in its cost of revenue. The COGS is primarily driven by the growth in manufacturing costs (+8.05% YoY) amidst sales volume increased by 10% YoY at 40.62 million tons. SMGR is currently trading at 17.89x/0.81x PER/PBV.

IHSG Updates
The JCI strengthened +0.53% to 7,421.21 on Wednesday (13/03), followed by a massive foreign net buy of IDR6.98 trillion. Most sectors closed higher, led by the basic industry sector (+2.61%) and infrastructure (+0.96%). On the other hand, the sectors that experienced a downturn was the energy (-2.40%) and technology (-1.64%). We view the JCI’s strengthening mainly to be driven by foreign flows amid a continued selloff in the tech sector as investors discern the persistently optimistic Consumer Confidence Index. The Rupiah closed stronger at IDR15,578/USD. We estimate that the JCI will move in the price range of 7,392-7,450. Today's recommendations: ERAA, ESSA, MDKA, PGAS.

Corporate Actions
Cum Dividend: BBNI (IDR280.50/share)

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