Global Market Highlights
DJIA gained +0.11% on Wednesday (30/08), followed by the S&P500 (+0.38%) and the Nasdaq (+0.54%). Wall Street solidly continued its strengthening, as market optimism increased about the Fed maintaining its benchmark interest rate at the FOMC Sep-2023. This was due to the addition of private business workers in Aug-2023 of 177k, or lower than the consensus at 195k. In addition, GDP in 2Q23 was revised down to +2.1% QoQ and is below the consensus estimate of +2.4% QoQ. Today, the market will be looking toward several data releases such as: 1) US Core PCE Price Index YoY Jul-2023; 2) Germany Unemployment Rate Aug-2023; 3) France Inflation Rate YoY Prel Aug-2023.
Domestic Update
• The Ministry of Energy and Mineral Resources (ESDM) will not authorize PGAS to increase the price of natural gas for specific industries (HGBT). MNCS Comment: We believe that industries, such as ceramics, stand to benefit if the proposed increase in the price of natural gas for certain sectors (HGBT) is halted. These tailwinds are anticipated to bolster the competitiveness of domestic products in the face of rising competition and foster domestic economic stability amid global uncertainties.
Company News
1. AMRT IJ has realized a capex allocation of up to 1H23 amounting to IDR1.5 - 1.8 trillion for business expansion (Kontan). MNCS Comment: Consequently, the capex realization reflects 37.5% - 40.9% of the FY23E target. We view the company's efforts to continually increase the number of its outlets this year positively. It is anticipated that this will bolster the company's future performance. This year, AMRT aims to expand its outlets by 800 - 1,000 units. Currently, AMRT is traded at a level of 37.33x/10.21x PER/PBV.
2. TRIN IJ has commenced the groundbreaking for the Holdwell Business Park located in Lampung, covering an area of 12.5 Ha (Emiten News). MNCS Comment: We see this project as TRIN's initiation into the business & logistic park on a strategically important logistics route. The targeted gross development value (GDV) is IDR800 billion. It is hoped that this business expansion will boost the company's future marketing sales. Currently, TRIN is traded at the level of 1.05x PBV.
3. BSSR IJ recorded a net profit decline of 17.2% YoY, amounting to USD106.4 million in 1H23, (vs USD128.5 million in 1H22) (Emiten News). MNCS Comment: The decline in net profit comes amidst a revenue increase of +39.6% YoY, concurrent with pressures from COGS and OPEX. COGS rose by +73.7% YoY, pressing the gross profit down to USD218.6 million (+4.4% YoY), while the GPM contracted to 36.8% (vs 49.2% in 1H22). Meanwhile, OPEX surged by +85.0% YoY, causing the operating profit to decrease by -16.9% YoY. NPM dropped to 17.9% (vs 30.2% in 1H22). Currently, BSSR is traded at the level of 3.35x/2.67x PER/PBV.
IHSG Updates
JCI strengthened +0.13% to 6,966.66 on Wednesday (30/08), followed by net foreign sell reaching IDR1.0 trillion. A number of sectors experienced strengthening and boosted the index rate, led by the infrastructure sector (+2.21%) followed by the health sector (+1.00%). On the other hand, the sectors that experienced weakness were the transportation sector (-0.61%) followed by the technology sector (-0.43%). The index strengthened amid mixed Asian markets, where investors were optimistic about welcoming a number of domestic macroeconomic data releases this week. The Rupiah closed lower at IDR15,240/USD. We estimate that the JCI will move in the price range of 6,955-6,975. Today's recommendation: ADMR, BTPS, MEDC, SRTG.
Corporate Actions
Cum Dividend: GEMS (USD0.05525/share)
RUPS: LTLS
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