Global Market Highlights
DJIA weakened by -0.10% on Wednesday (12/10), followed by S&P500 (-0.33%) and Nasdaq (-0.09%). Wall Street was pressured by the increasing investor concerns regarding the potential for more aggressive monetary tightening by the Fed, after the release of PPI data in Sep-22 which was recorded at +0.4% MoM, or exceeded consensus estimates and realization in Aug-22 by + 0.2% MoM/-0.2% MoM. Today, the market will be looking toward several data releases such as: 1) US Inflation Rate Yoy Sep; 2) US Core Inflation Rate Yoy Sep; 3) UK BoE Credit Conditions Survey.
Domestic Update
• Domestic motorcycle sales reached 514,460 units in Sep-22, lower than August-22 with sales of 524,821 unit, yet still grew by +10.7% YoY. MNCS Comment: Domestic motorcycle sales continue to show an increase which reflects the ongoing economic recovery. Motorcycle sales are now back to near pre-pandemic levels.
• Furthermore, the national Covid-19 daily rate had increased by 2,028 active cases (12/10).
Company News
1. SMRA IJ recorded marketing sales of IDR3.5 trillion up to 9M22, supported by sales of Summarecon Serpong which contributed to 51% of the sales (Emiten News). MNCS Comment: Marketing sales achievement grew by +2.94% YoY (vs IDR3.4 trillion in 9M22). Meanwhile, with the marketing sales target reaching IDR5 trillion in FY22E, the realization up to 9M22 reached 70%. SMRA is currently traded at the level of 18.32x/1.05x PER/PBV.
2. ESSA IJ posted a +131.60% YoY revenue growth in 9M22 to USD557.03 million (vs USD240.51 million in 9M21). Meanwhile, net profit grew by +1,183.25% YoY to USD104.64 million (vs USD8.15 million in 9M21) (Market Bisnis). MNCS Comment: The increase in net profit was in line with the company's higher revenue supported by ASP Ammonia growth in 9M22 by +105% YoY to USD902/mt (vs USD441/mt) and production increase by +16% YoY. Currently, ESSA is traded at the level of 6.99x/3.06x PER/PBV.
3. WMPP IJ will carry out bio-security to prevent the impact of the FMD outbreak and run cost efficiency in line with the rising prices of poultry feed ingredients (Kontan). MNCS Comment: We view these efforts will boost the company's performance in 2H22, where in 1H22, the company's revenue fell by -19.64% YoY whilebottom-line recorded a net loss of IDR3.02 billion (vs net profit of IDR100.26 billion in 1H21). We hope that the presence of bio-security can boost the performance of the cattles segment as one of the company's main revenue contributors. WMPP is currently traded at the level of 1.91x PBV.
IHSG Updates
JCI weakened by -0.43% to 6,909.21 on Wednesday (12/10), followed by net foreign buy which reached IDR209.69 billion. The majority of sectors experienced weakness and weighed on the index's pace, led by the technology sector (-2.97%) followed by the cyclical sector (-1.36%). On the other hand, the sector that experienced strengthening was the energy sector (+0.99%). The index was corrected amid the release of data on motorcycle sales in Sep-22 which slowed to +10.7% YoY (vs +11.6% YoY in Aug-22). Meanwhile, investors were watching the South Korean central bank's decision to raise its benchmark interest rate +25 bps to 3%. In addition, investors also tend to wait and see ahead of the release of US PPI data Sep-22, where consensus estimates for +0.2% MoM (vs realization - 0.1% MoM in Aug-22). On the other hand, the Rupiah exchange rate closed flat at the level of IDR15,358/USD. We estimate that the JCI will move in the price range of 6,800-7,000 pending the release of Car Sales YoY Sep data. Today's recommendation: BBRI, DEWA, MDKA, PGAS.
Corporate Actions
Cum Dividend: AUTO (IDR22/share)
Cum Rights: DNAR (IDR170/share)
RUPS: BTPS
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