Global Market Highlights
DJIA strengthened +1.17% on Friday (03/03), followed by the S&P500 (+1.61%) and the Nasdaq (+1.97%). Wall Street managed to continue strengthening, supported by a decline in the UST yield to 3.96% as well as the release of the ISM Non-Manufacturing PMI Feb-2023 which remained solid at 55.1 (vs 54.5 in consensus). Today, the market will be looking toward several data releases such as: 1) US Factory Orders MoM Jan; 2) UK S&P Global/CIPS Construction PMI Feb; 3) Germany S&P Global Construction PMI Feb.
Domestic Update
• Through ID FOOD, the government has distributed 12 million liters of subsidized cooking oil with a price cap of IDR14,000 and will subsidize staple food items such as rice, eggs and chicken during March, April and May. MNCS Comment: This policy was set to reduce volatile foods inflation and anticipate depleting stocks ahead of the month of Ramadan and Eid Al-Fitr amid unfavorable weather. The subsidy can increase people's purchasing power in the textile and clothing sector ahead of the holiday.
Company News
1. ADRO IJ posted net profit growth of +167.1% YoY to USD2.5 billion in FY22 (vs USD933.5 million in FY21) (Market Bisnis). MNCS Comment: Net profit growth was supported by revenue increase +102.9% YoY to USD 8.1 billion (vs USD 4.0 billion in FY21), as sales volume increased +19% YoY to 61.34 million tons (vs 51.58 million tonnes in FY21). In addition, margins were recorded as expansive where GPM/OPM were 57.4%/53.2% respectively. The FY22 strip ratio is 3.75x (vs 4.15x). Currently, ADRO is traded at the level of 2.50x/0.80x PER/PBV.
2. ADHI IJ recorded a net profit in FY22 of IDR81.2 billion, or grew +47.2% YoY (vs IDR55.2 billion in FY21) (Market Bisnis). MNCS Comment: The increase in net profit was supported by: 1) revenue increase +17.5% YoY; 2) increase in revenue from JV +17.0% YoY; 3) decrease in financial expenses -6.7% YoY; 4) decrease in other expenses before PBT -26.9% YoY. Currently, ADHI is traded at the level of 0.67x PBV.
3. AVIA IJ posted a -2.4% YoY drop in net profit to IDR1,400.6 billion (vs IDR1,434.6 billion in FY21) (Market Bisnis). MNCS Comment: The decline in net profit was in line with revenue which was relatively flat -1.3% YoY in FY22, amid an increase in operating expenses +16.0% YoY. Meanwhile, the increase in financial income to IDR293.7 billion (vs. IDR80.7 billion in FY21) succeeded in supporting net profit. Currently, AVIA is trading at the level of 26.76x/3.92x PER/PBV.
IHSG Updates
JCI weakened -0.64% to 6,813.64 on Friday (03/03), followed by net foreign sell reaching IDR606.21 billion. The majority of sectors experienced weakening and suppressed the index rate, led by the transportation sector (-1.37%) followed by the non-cyclical sector (-1.13%). On the other hand, sectors that experienced strengthening were led by the technology sector (+0.80%) followed by the infrastructure sector (-0.49%). Investors were watching initial US jobless claims which fell to 190k, indicating a strong labor market that opens up opportunities for the Fed to raise interest rates going forward. On the other hand, the Rupiah exchange rate closed lower at the level of IDR15,30300/USD. We estimate that the JCI will move in the price range of 6,797-6,834. Today's recommendation: BUKA, CHEM, INDF, MYOR.
Corporate Actions
Cum Dividend: MEGA (IDR241.62/share)
IPO: PTMP (IDR120/share)
RUPS: RISE
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