Global Market Highlights
DJIA strengthened +1.00% on Friday (26/05), followed by the S&P500 (+1.30%) and the Nasdaq (+2.19%). Wall Street managed to close higher as the positive catalyst from personal spending data for Apr-2023 managed to grow +0.8% MoM, or above the consensus at +0.4% MoM.
Domestic Update
• Bank Indonesia reported, based on transaction data May 22-25, 2023, non-residents on the domestic financial market posted a net purchase of IDR0.97 trillion, with a net sale of IDR0.76 trillion on the SBN market and a net purchase of IDR1.74 trillion on the stock market. MNCS Comment: On a YTD basis, non-resident net purchases grew to IDR68.66 trillion on the SBN market and IDR15.53 trillion net purchases on the stock market, indicating that foreign investors still hold a risk-averse position and SBN presents as an attractive choice with competitive yields.
Company News
1. TLKM IJ potentially distributes dividends for the FY22 fiscal year reaching IDR16 trillion, considering DPR of 70-80% (Investor ID). MNCS Comment: With a net profit of IDR20.7 trillion in FY22 and DPR 80%, the DPS is estimated to be IDR16.6 trillion or equivalent to IDR167.6 per share. Thus, the estimated dividend yield is around 4.1%. Currently TLKM is traded at the level of 15.92x/3.02x PER/PBV.
2. IPCM IJ plans to expand into the nickel mining sector, as a provider of pilot boats and tugboats from cargo delivery to mines (Investor ID). MNCS Comment: We view positively the company's efforts to increase business diversification and the potential for customer acquisition, where this can increase the company's profitability. With the downstream process of the mining industry which continues to be improved as well as different smelters and mines, services are certainly needed in terms of shipping the cargo. Currently, IPCM is traded at the level of 8.01x/1.22x PER/PBV.
3. UNTR IJ targets an increase in gold production and sales volume in FY24F, driven by the normalization of the Sumbawa Juta Raya (SJR) mine operations. Meanwhile, the gold sales target in FY23E was 175k troy ounces (vs FY22 realization: 269.8k troy ounces) (Market Bisnis). MNCS Comment: The decline in sales target in FY23E was in line with the project to expand the tailings storage facility at the Martabe gold mine. However, we still view this as providing long-term value, while the increase in gold prices is expected to offset the decline in production rates. Up to 4M23, actual gold sales reached 76.3k troy ounces, or 43.6% of the FY23E target. Currently UNTR is traded at the level of 4.04x/0.98x PER/PBV.
IHSG Updates
JCI weakened -0.26% to 6,687.00 on Friday (26/05), followed by net foreign buy reaching IDR442.38 billion. The majority of sectors experienced weakness and weighed on the index, led by the technology sector (-2.22%) followed by the energy sector (-1.34%). On the other hand, sectors that experienced strengthening were led by the non-cyclical sector (+0.30%) followed by the raw material sector (+0.23%). The index weakened amid the majority of Asian bourses that recorded gains, where investors are still monitoring the development of the settlement of the US debt ceiling, as well as keeping an eye on the rising expectations of US 5Y inflation. The rupiah closed lower at IDR14,955/USD. We estimate that the JCI will move in the price range of 6,681-6,695 pending the release of M2 Money Supply YoY Apr data. Today's recommendation: BFIN, BIPI, INKP, INTP.
Corporate Actions
Cum Dividend: PBID (IDR100/share), STAA (IDR46/share), SMSM (IDR25/share)
Disclaimer On
