MNCS Morning Navigator

18 Mei 2022

MNCS Morning Navigator May 18, 2022

Global Market Highlights
DJIA rose +1.34% on Tuesday (17/05), followed by the S&P 500 (+2.02%) and Nasdaq (+2.76%). Wall Street's strengthening was supported by the easing of the lockdown that occurred in China, thus creating a more optimistic outlook for global economic growth. Meanwhile, April retail sales growth which was in line with +0.9% MoM consensus added to the positive catalyst for Wall Street. Today, the market will be looking toward several data releases such as: 1) US MBA Mortgage Applications; 2) UK Inflation Rate YoY; 3) Japan Industrial Production YoY Final.

Domestic Update
Research on e-Conomy SEA estimates that the size of Indonesia's digital economy in 2021 will reach USD 70 billion. MNCS Comment: We view that Indonesia's digital economy will continue to grow, supported by trends in the e-commerce and digital payments sector.
Furthermore, the second dose of vaccination rate nationally has reached 79.8% or equivalent to 166.29 million people.

Company News
1. CTRA IJ recorded revenue of IDR2.23 trillion, up +20.72% YoY in 1Q22 (vs IDR1.85 trillion in 1Q21). Net profit rose +72.88% YoY to IDR420.74 billion in 1Q22 (vs IDR243.37 billion in 1Q21) (IQ Plus). MNCS Comment: The increase in top line was driven by landed house sales which reached USD1.50 trillion or increased +63.29% YoY. Meanwhile, finance expenses fell -18.40% YoY to USD284.24 billion making NPM grow to 18.83% in 1Q22 (vs 13.15% in 1Q21). CTRA is currently trading at 11.03x/1.07x PER/PBV.
2. BRPT IJ recorded revenue of USD813 million or up +12% YoY in 1Q22 (vs USD726 million in 1Q21). Net profit decreased -80% YoY to USD9 million in 1Q22 (vs USD45 million in 1Q21) (IQ Plus). MNCS Comment: The top line was driven by petrochemical revenue which rose +13% YoY to USD676 million in 1Q22. Meanwhile, COGS which increased +47% YoY to USD682 million caused a decrease in the bottom line. BRPT is currently trading at 143.74x/3.03x PER/PBV.
3. HRUM IJ recorded coal production of 1 million tons in 1Q22 or up +28% YoY. Meanwhile, coal sales rose +7.7% YoY to 0.9 million tonnes in 1Q22 (Kontan). MNCS Comment: Although HRUM's coal sales volume increased only by 7.7% YoY, HRUM's performance was supported by an increase in ASP of +158.8% YoY to USD168.4 per tonne in 1Q22. The majority of HRUM's sales were to China at 55%, followed by Japan at 20% and the Netherlands at 9%. HRUM is currently trading at 8.23x/3.78x PE/PBV.

IHSG Updates
JCI rose +0.70% to 6,644.47 on Tuesday (17/05), followed by net foreign buy which reached IDR169.98 billion. A number of sectors experienced strengthening and boosted the index rate, led by the energy sector (+3.34%) followed by the raw materials sector (+1.13%). On the other hand, the sector that experienced weakness was the infrastructure sector (-0.89%) followed by the technology sector (-0.12%). The index managed to close in the green zone, positive catalysts came from Indonesia's trade balance Apr-22 which recorded a surplus of USD7.56 billion. On the other hand, the Rupiah exchange rate closed low at IDR14,650/USD. We estimate that the JCI will move in the price range of 6,600-6,750. Today’s recommendation: GZCO, INKP, PTBA, ASII.

Corporate Action
Cum Dividend: SMSM (IDR15/share), PNGO (IDR70/share)

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