Global Market Highlights
DJIA rose by +0.26% on Wednesday (29/09) followed by the S&P 500 (+0.16%), while Nasdaq slipped by -0.24%. The Wall Street closing was mixed due to the US government bonds yield tenor 10 years today fell by 2 points to 1.5% level, followed by the US released data on MBA Mortgage Applications which fell by -1.1% from previously +4.9%.From a macroeconomic view, the US economy is expected to grow by 6.6% in 2H21. Subsequently, the US consumer spending is likely to have risen by 3.7% in 2Q21 or a slowing down from the first quarter at 6.5% growth. Today the market will be looking forward to several data releases such as: 1) US GDP Growth Rate QoQ Final; 2) Germany Inflation Rate YoY Prel; 3) China NBS Manufacturing PMI.
Domestic Update
• Banks are now reducing their holdings in government securities and their funds at central bank as demand for credit is improving according to the Indonesia Deposit Insurance Agency. MNCS Comment: With ample liquidity and better economic outlook, we believe that banks appetite to disburse loan and demand for credit will likely to increase in the coming months as we already saw loan growth expanded in the last 3 months (Jun-Aug 2021) even though the pace remained slow (<2%).
• Furthermore, there was an addition of 177 new Covid-19 cases in Jakarta yesterday.
Company News
1. ASII IJ will distribute an interim dividend of IDR45/share or IDR1.82 trillion for the 2021 financial year period. The cum dividend date is on October 7, 2021 (Emitennews). MNCS Comment: the payout ratio stood at 20.61% from the 1H21 profit of IDR8.83 trillion. Dividend yield reached 0.85%. Currently ASII is trading at 12.21x/1.33x PE/PBV levels.
2. WIKA IJ has acquired all shares owned by electric motor manufacturer, PT Gesits Technologies Indo, in PT WIKA Industri Manufaktur (WIMA). The total number of shares acquired was 6,800 shares or equivalent to 10.66% of WIMA's shares from GTI with a transaction value of IDR36.5 billion. (Trenasia). MNCS Comment: We see this is WIKA's strategy to increase the company value. The company continues to focus on innovation to provide the best service for customers and become a global electric motorcycle company. WIKA is currently trading at the level of 64.52x/0.78x PER/PBV.
3. ASRI IJ recorded marketing sales of IDR2,01 trillion up to 8M21. The value increased by +9.35% YoY (vs Rp1.83 trillion in 8M20). The largest contributor came from sales of houses and residential land of IDR1.34 trillion or 66.67% of the total marketing sales up to 8M21 (Market Bisnis). MNCS Comment: We see that ASRI's marketing sales have the potential to increase, driven by the 100% DTP VAT stimulus from the government, which is extended until the end of FY21E, and low bank loan interest rates. ASRI is currently trading at the level of 0,36x PBV.
IHSG Updates
JCI rose by +0.81% to 6,162.55 on Wednesday (29/09) followed by net foreign buy reaching IDR1.69 trillion. JCI closed higher in almost all sectors, led by the industrial sector (+4.19%), followed by the energy sector (+3.24%). On the other hand, the technology sector weakened -3.53%. The increase in the JCI is in line with the easing of community activities, so that it will increase government infrastructure spending budget, consumption, and Indonesia's economic growth. On the other hand, the Rupiah weakened at IDR14,292/USD level on the spot market. We estimate the JCI will move in the range of 6,120-6,170. Today's recommendations: ANTM, BBTN, BSDE, SSMS.
Corporate Action
RUPS: TBIG, CASS, PURA
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