Global Market Highlights
DJIA fell -0.19% on Thursday (03/08), followed by the S&P500 (-0.25%) and the Nasdaq (-0.10%). Wall Street closed lower again, due to rising UST yields and weak macro data, where initial jobless claims as of 29-Jul rose to 227k and PMI services ISM in Jul-2023 fell to 52.7 (vs 53.9 previously). Today, the market will be looking toward several data releases such as: 1) US Non Farm Payrolls Jul-2023; 2) US Unemployment Rate Jul-2023; 3) UK S&P Global/CIPS Construction PMI Jul-2023.
Domestic Update
• The Financial Services Authority reported an outstanding Covid-19 restructuring credit of IDR361.04 trillion in Jun-2023, a decrease of IDR11.03 trillion compared to the May-2023 position of IDR372.07 trillion. MNCS Comment: This decrease in the outstanding balance indicates a continuing recovery. Moreover, fiscal and monetary policies aimed at pro-stability also support this trend. The positive impact will be felt by the banking sector with the NPL gradually recovering to below 3%.
Company News
1. SMRA IJ posted a net profit in 1H23 of IDR433.9 billion, up +70.4% YoY (vs IDR254.6 billion in 1H22) (Kontan). MNCS Comment: The increase in net profit was supported by a +8.6% YoY increase in revenue to IDR3.0 trillion (vs IDR2.7 trillion in 1H22). The investment property as well as leisure and hospitality segments increased +20.3% YoY/+63.7% YoY respectively. Meanwhile, NPM was expansive to 14.6% (vs 9.3% in 1H22) as the final tax rate decreased. Currently, SMRA is traded at the level of 12.56x/1.14x PER/PBV.
2. RALS IJ posted a -13.8% YoY drop in net profit to IDR246.7 billion (vs IDR286.0 billion in 1H22) (Emiten News). MNCS Comment: Net profit declined in line with a decrease in revenue of -10.3% YoY. This is due in part to a generally weak Lebaran festive season, accelerated holiday allowance payments, and an earlier homecoming momentum. Meanwhile, the NPM slightly decreased to 14.8% (vs 15.4% in 1H22). Currently, RALS is traded at the level of 8.05x/1.09x PER/PBV.
3. LSIP IJ recorded a decrease in net profit -69.7% YoY to IDR166.5 billion (vs IDR548.8 billion in 1H22) (Kontan). MNCS Comment: The decrease in net profit was in line with revenue which fell -8.0% YoY to IDR1.9 trillion (vs IDR2.0 trillion in 1H22), as well as an increase in COGS +28.8% YoY which weighed on gross profit performance (-60.8% YoY). Currently, LSIP is traded at the level of 21.51x/0.67x PER/PBV.
IHSG Updates
JCI strengthened +0.64% to 6,898.08 on Thursday (03/08), followed by net foreign buy reaching IDR433.01 billion. The majority of sectors experienced strengthening and drove the index rate, led by the raw materials sector (+1.60%) followed by the technology sector (+1.03%). On the other hand, sectors that experienced a decline were led by the infrastructure sector (-0.08%) followed by the transportation sector (-0.05%). The JCI movement has outperformed the weakening Asian markets. Investors were closely monitoring the impact of the US debt rating downgrade, while also keeping an eye on the earnings releases for 2Q23. The Rupiah closed lower at IDR15,185/USD. We estimate that the JCI will move in the price range of 6,881-6,934. Today's recommendation: ACES, BUMI, ITMG, UNTR.
Corporate Actions
RUPS: AKSI, SRSN
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