Global Market Highlights
The DJIA rose by +0.34% on Thursday (07/03), followed by S&P 500 (+1.03%) and Nasdaq (+1.51%). Wall Street continued its solid gains, driven by dovish sentiments. Powell revealed that a rate cut could start later this year, although The Fed is still monitoring several indicators like PCE. Additionally, initial jobless claims on Mar 2 recorded 217k, slightly higher than the consensus expectation of 215k. We consider the weak labor market to potentially reinforce expectations for a rate cut in Jun-2024. Today, the market will await several data releases, including: 1) Germany PPI MoM Jan-2024; 2) US Non Farm Payrolls Feb-2024; 3) US Unemployment Rate Feb-2024.
Domestic Update
Bank Indonesia reported Indonesia’s foreign exchange reserve position at USD144.0 billion for Feb-2024, decreasing from USD145.1 billion in Jan-2024. Bank Indonesia is optimistic that this position is above the sufficiency standard of ~3 months of import, equivalent to financing 6.5 months of import or both 6.3 months of import and payment of foreign government debt. MNCS Comment: This decline is in line with the estimation made after the release of foreign capital inflow transactions earlier. Net inflow in the stock market was recorded at USD646 million, while a decrease of USD302 million was recorded in the bond market. We view Bank Indonesia’s stabilization measures to maintain the stability of the Rupiah as also influencing the foreign exchange reserve position.
Company News
1. BMRI IJ announced dividend distribution worth IDR 33.03 trillion or reflects a dividend yield of 4.98% vs 3.70% in the previous year (Kontan). MNCS Comment: The dividend amount reflects DPR's 60% of FY23 profit of IDR 55.1 trillion (an increase of +33.7% YoY), or the same as DPR in FY22. If detailed, the amount of dividends that will be allocated to the state is IDR 17.18 trillion, while for the public it is IDR 353.95 trillion. BMRI is currently trading at 2.54x PBV.
2. DMAS IJ recorded a net profit of IDR1.2 trillion in FY23, or a relatively flat -0.6% YoY (Emiten News). MNCS Comment: We assess this net profit performance in line with flat revenue of -0.6% YoY in FY23, reaching IDR1.9 trillion. Meanwhile, COGS increased by +6.9% YoY, followed by a +24.7% YoY increase in OPEX. However, the performance of other income streams successfully supported the contraction of operating profit, which decreased by -8.4% YoY. DMAS is currently trading at 6.45x/1.33x PER/PBV.
3. MTEL IJ announced an increase of +11.2% YoY revenue and +12.6% YoY net income for FY23 (Kontan). MNCS Comment: The earnings released are in line with our FY23 estimations at +11.4% of revenue, tenancy ratio of 1.51x (vs 1.47x in FY22), NPM of 23.1% (vs actual 23.4%), and surpassing our net profit forecast at +11.5%. This robust performance is contributed from tower leasing segment (+12% YoY) and fiber as the new revenue contributor. Meanwhile, reseller and tower-related lines decreased -10.2% YoY and -5.3% YoY, respectively, as company plans to gradually reduce the proportion and be selective in pursuing high margins opportunities. MTEL is currently trading at 26.1x/1.54x PER/PBV.
IHSG Updates
The JCI strengthened +0.60% to 7,373.96 on Thursday (07/03), followed by foreign net buy reaching IDR 478.56 billion. Most sectors closed higher, led by the basic materials sector (+2.19%) and followed by the energy sector (+0.92%). On the other hand, the sectors experiencing weakness were led by the technology sector (-2.57%) and industrial (-0.35%). The outperform index strengthened amid investors who were paying close attention to the Fed's dovish statement and the increasing possibility that interest rate cuts would be carried out in 2Q24. The Rupiah closed stronger at IDR15,653/USD. We estimate that the JCI will move in the price range of 7,334-7,384. Today's recommendations: AKRA, BIRD, MBMA, TLKM.
Corporate Actions
EGMS: BGTG, MAGP
Disclaimer On
