Global Market Highlights
DJIA rose by +0,68% on Thursday (28/10), followed by S&P 500 (+0.98%) and Nasdaq (+1.39%). Wall Street ended higher with solid 3Q21 earnings results from the US companies which had helped reduce the concerns about slowing economic growth. The US GDP Growth Rate in 3Q21 grew by +2% QoQ from the previous at 6.7% QoQ, making this the slowest increase since the pandemic-era recovery due to supply chain issues and lower consumer spending. Today the market will be looking forward to several data releases such as: 1) US PCE Price Index YoY; 2) Eurozone GDP Growth Rate YoY Flash; 3) Germany GDP Growth Rate YoY Flash.
Domestic Update
• Direct investment realization in Indonesia from Jan-Sep 2021 was recorded at IDR659 trillion, reaching 73.3% from the target of IDR900 trillion this year. The highest investment realization was reported in the housing & real estate sector and base metal industry which accounted for 26% of the total direct investment. MNCS Comment: Overall investment realization grew by 7.8% YoY over the same period of 9 months in 2020. Fiscal stimulus, macroprudential policy relax as well as commodity boom have supported investment flow to housing, real estate and base metal industry. With the brighter outlook in 4Q21, we expect direct investment realization would likely increase and reach the 2021 target.
• Furthermore, the second dose of vaccination rate nationally reached 33.8% or equivalent to 70.41 million people.
Company News
1. BMRI IJ posted IDR53.32 trillion net interest income (NII) for 9M21, rose by +26.47% YoY (vs IDR42.16 trillion in 9M20). The number was supported by the increase in disbursement of People’s Business Credit (KUR) reaching IDR100.10 trillion for 9M21 or grew by +20.30% YoY. BMRI recorded IDR19.23 trillion net profit in 9M21 or an increase of +37.06% YoY (vs IDR14.03 trillion in 9M20) (Kontan). MNCS Comment: We see the bottom line growth was supported by the optimization of the company’s intermediation function in line with the national economic recovery. As of 9M21, BMRI’s CASA ratio increased by +7.15% YoY to 74.57%. BMRI is currently trading at level 13.11x/1.73x PER/PBV.
2. AALI IJ recorded IDR18.01 trillion revenue in 9M21 or an increase of +35.21% YoY (vs IDR13.32 trillion in 9M20). COGS increased from IDR11.41 trillion in 9M20 to IDR14.40 trillion in 9M21. AALI recorded IDR1.47 trillion net profit in 9M21, rose by +152.20% YoY (vs net profit of IDR582.5 billion in 9M20) (Bisnis Indonesia). MNCS Comment: We see that AALI’s performance is affected by supply and demand factors as well as the recovering global economy. The increase in CPO prices in 3Q21 drove a positive impact on AALI's sales. AALI is trading at the level of 9.85x/0.96x PER/PBV.
3. ISAT IJ recorded IDR23.06 trillion revenue in 9M21, an increase of +11.99% YoY (vs IDR20.59 trillion in 9M20). The company managed to reduce expenses from IDR18.84 trillion in 9M20 to IDR14.98 trillion in 9M21. ISAT recorded IDR5.80 trillion net profit in 9M21 (vs net loss of IDR457.50 billion in 9M20) (CNBC Indonesia). MNCS Comment: ISAT’s top line growth was driven by cellular sales of IDR18.79 trillion or rose by +10.33% YoY. The significant increase in net profit was contributed by divest and leaseback of towers amounting to IDR6.17 trillion. Currently, ISAT is trading at level 4.99x/2.17x PER/PBV.
IHSG Updates
JCI weakened by -1.18% to 6,524.08 on Thursday (28/10) followed by net foreign sell reaching IDR504.74 billion. JCI closed lower in almost all sectors led by the energy sector (-2.68%), followed by the industrial sector (-2.22%). On the other hand, the technology sector strengthened by +0.77%. The weakening of the JCI was driven by several global sentiments, such as the slowing down of the US economic recovery in 3Q21, China's lockdown and default of several major China property companies. The decline in several commodities such as coal, oil, nickel, tin and CPO also contributed to the weakening of the JCI today. On the other hand, the Rupiah exchange rate was stagnant at IDR14,173 level in the spot market. We estimate the JCI will move in the range of 6,450-6,550. Today's recommendations: TLKM, BFIN, MLPL, PTPP.
Corporate Action
Cum Date Bonus Stock: CCSI (5:1)
RUPS: TGRA
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