Global Market Highlights
The DJIA strengthened by +0.46% on Monday (06/05), followed by the S&P 500 (+1.03%) and the Nasdaq (+1.19%). Wall Street stroked a solid closing again as investors reacted positively to most of the 1Q24 earnings postings. Additionally, the softening in the job markets for Apr-2024 prompted investors’ expectations for the Fed to put the rate cut into the 2024 agenda. Today the market will be looking forward to several data releases such as: 1) China Foreign Exchange Reserves Apr-2024; 2) Australia RBA Interest Rate Decision; 3) Japan Jibun Bank Services PMI Final Apr-2024
Domestic Update
BPS reported that Indonesia’s GDP in 1Q24 remains resilient at +5.11% YoY growth (vs +5.04%/+5.00% in 4Q23/Consensus), marking the highest growth since 2015. While a contraction of -0.83% was recorded on a QoQ basis due to seasonality factor. MNCS Comment: The economic strengthening in this period was mainly driven by the rise in the business fields (LU) of the processing industry (+4.13% YoY), the trade industry (+4.58% YoY), and the construction industry (+7.59% YoY). Additionally, the household consumption increased by +4.91% YoY, driven by the 2024 election and Ramadan festive momentums. The export performance which climbed by +1.77% YoY amidst moderating prices of main commodities while imports fell -19.77% YoY also became incentives to the GDP’s growth. We expect Indonesia’s GDP to still grow at the range of 4.9%-5.1% YoY in 2024 (vs BI’s projection at 4.7%-5.5%).
Company News
1. INTP IJ reported a decrease in net profit of -35.9% YoY to IDR238.0 billion in 1Q24 (vs IDR371.4 billion in 1Q23). MNCS Comment: The decline in net profit was accompanied by a -3.8% YoY decrease in revenue to IDR4.1 trillion (vs IDR4.2 trillion in 1Q24). COGS only decreased by -2.3% YoY, thus burdening gross profit performance, which decreased by -7.5% YoY. Meanwhile, INTP recorded a +6.6% YoY increase in OPEX, resulting in a -33.1% YoY decrease in operating profit. Margins experienced contraction, with OPM/NPM decreasing to 7.4%/5.8% (vs 10.7%/8.7% in 1Q23). INTP is currently trading at 27.55x/1.24x PER/PBV.
2. SSMS IJ recorded an increase in net profit of +14.4% YoY to IDR276.9 billion in 1Q24 (vs IDR242.0 billion in 1Q23). MNCS Comment: The increase in net profit was supported by a +29.7% YoY increase in revenue to IDR2.5 trillion (vs IDR1.9 trillion in 1Q23). COGS achieved efficiency, resulting in a +20.7% YoY growth, and led to a gross profit increase of +55.8% YoY. However, the increase in OPEX and the decrease in profit from biological assets created a more moderate growth in operating profit of +9.3% YoY. OPM/NPM experienced decreases to 21.5%/11.0% (vs 25.5%/12.5% in 1Q23). SSMS is currently trading at 18.37x/5.47x PER/PBV.
3. HRTA IJ achieved a strong growth of bottom-line (+47.05% YoY) in 1Q24 (Kontan). MNCS Comment: This performance was supported by the soaring revenue (+89.66% YoY), favored by the increase in gold prices for the 1Q24. The wholesales segment grew by +70.03% YoY and the stores sales advanced by +378.71%, serving as main drivers to the total sales growth. This achievement reflects 24.48%/29.82% of our FY24E estimation and we expect HRTA to carry a solid performance throughout this year. HRTA is currently trading at 17.76x/0.88x PER/PBV.
IHSG Updates
The closed flat at +0.02% to 7,135.89 on Monday (06/05), followed by net foreign sell reaching IDR1.18 trillion. Most sectors experienced gains and drove the index, led by the property sector (+2.56%) and followed by the technology sector (+1.49%). Meanwhile, sectors experiencing declines were led by the industrial sector (-1.76%), followed by the transportation and logistics sector (-0.09%). The index relatively flat amid predominantly positive closures in Asian markets. Investors responded positively to the release of GDP growth data in 1Q24, which increased by +5.11% YoY, but the continued foreign net sell-off dampened index appreciation. The Rupiah closed higher at IDR16,025/USD. We estimate that the JCI will move in the price range of 7,111-7,178. Today's recommendations: ANTM, ASSA, CTRA, PNLF.
Corporate Actions
Cum Dividend: AUTO (IDR132/Share), MCOL (IDR430/Share)
IPO: DATA (IDR188/Share)
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