Global Market Highlights
DJIA was up by +1.12% on Tuesday (18/10), followed by the S&P500 (+1.14%) and the Nasdaq (+0.90%). Wall Street's gains were supported by the release of 3Q22 earnings from a number of issuers in line with market expectations. In addition, investors were also watching the release of Industrial Production data in Sep-22 which managed to grow +5.3% YoY (vs +3.9% YoY in Aug-22). Meanwhile, the decline in the yield on the US T-note 10Y to below the 4% level to 3.99% also contributed to Wall Street's pace. Today, the market will be looking toward several data releases such as: 1) US MBA Mortgage Applications; 2) UK Inflation Rate YoY Sep; 3) UK Core Inflation Rate YoY Sep.
Domestic Update
• BI reported an increase in credit demand by corporations and households reflected by the Net Weighted Balance amounting 56.8% in the latest banking survey. MNCS Comment: Given recent banking conditions, with ample liquidity and rising credit demand, inflation can be expected to rise and therefore followed by BI’s decision to raise interest rates.
• Furthermore, the national Covid-19 daily rate had increased by 2,164 active cases (18/10).
Company News
1. WSKT IJ recorded a new contract value of IDR11.6 trillion up to 9M22. Meanwhile, the new contract value consisted of: 1) 65.36% of the government; 2) 11.86% business development of subsidiaries; 3) 11.81% private; 4) 10.98% owned by BUMN (CNBC Indonesia). MNCS Comment: New contract value fell by -3.41% YoY (vs IDR12.01 trillion in 9M21). Meanwhile, with the target of achieving new contract values in FY22E reaching IDR30 trillion, the realization up to 9M22 was recorded at 38.67%. Currently, WSKT is traded at the level of 1.19x PBV.
2. AMRT IJ targeted the expansion of new outlets of 800-1,000 units in FY22E (Market Bisnis). MNCS Comment: With the opening of new outlets up to 8M22 reaching 812 units, the realization in FY22E has reached 81.30%. We are optimistic that AMRT will be able to achieve this target, supported by the capex allocation target of IDR1.5 trillion in FY22E. It is hoped that this expansion will encourage the company's performance in the future. Currently, AMRT is traded at the level of 44.71x/12.11x PER/PBV.
3. ADHI IJ recorded a new contract value of IDR 18.1 trillion up to 9M22. Meanwhile, the new contract value consisted of: 1) 90% construction business line; 2) 6% property; 3) 4% other businesses (Market Bisnis). MNCS Comment: Thus, the achievement of new contract value increased by +57.3% YoY. With the target of achieving new contract values in FY22E to reach IDR25-30 trillion, the realization up to 9M22 is 60.33%-72.40%. ADHI is currently traded at the level of 0.41x PBV.
IHSG Updates
JCI strengthened by +0.05% to 6,834.49 on Tuesday (18/10), followed by net foreign sell which reached IDR738.74 billion. The majority of sectors experienced strengthening and boosted the index rate, led by the non-cyclical sector (+1.60%) followed by the financial sector (+1.11%). On the other hand, the sectors that experienced weakness were the energy sector (-0.69%) followed by the technology sector (-0.41%). The strengthening of Wall Street and the majority of Asian bourses also supported the index movement. Investors also tend to be optimistic ahead of the release of credit growth data on Sep-22, where on Aug-22, credit growth was recorded at +10.62% YoY. On the other hand, the Rupiah exchange rate closed higher at IDR15,468/USD. We estimate that the JCI will move in the price range of 6,800-6,930 pending the release of Loan Growth YoY Sep data. Today's recommendation: GOTO, MDKA, RAJA, UNVR.
Corporate Actions
Cum Rights: BACA (IDR100/share)
RUPS: ELTY, TAXI
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