Global Market Highlights
Wall Street closed in commemoration of Independence Day on Tuesday (04/07). The US market will again pay attention to developments in the labor market that may affect the decision of the Fed. Meanwhile, European markets closed lower as investors worried that an aggressive increase in benchmark interest rates would affect the outlook for the economy. Today, the market will be looking toward several data releases such as: 1) US FOMC Minutes; 2) US Factory Orders MoM May-2023; 3) UK S&P Global/CIPS Services PMI Final Jun-2023.
Domestic Update
• The Ministry of Finance reported tax revenue in 1H23 reaching IDR970.2 trillion, or a realization of 56.5% of the target set in the 2023 State Budget. MNCS Comment: Realization of tax revenue is still in-line with the target set. We see continued economic recovery, as income tax (PPh) revenues increased +26.2% YoY.
Company News
1. PWON IJ will distribute cash dividends for the FY22 fiscal year of IDR313 billion, or the equivalent of IDR6.5 per share (Market Bisnis). MNCS Comment: Therefore, PWON will offer a dividend yield of 1.3%. The amount of DPS increased from the previous year (IDR4 per share), in line with the increase in the payout ratio. Currently, PWON is traded at the level of 10.07x/1.34x PER/PBV.
2. IPCC IJ will distribute final cash dividends for the FY22 fiscal year of IDR90.49 billion, or the equivalent of IDR49.77 per share (Emiten News). MNCS Comment: Thus, IPCC will offer a dividend yield of up to 6.1%. The total DPS FY22 (IDR62.3 per share) was higher from the previous year FY21 (IDR23.12 per share) as performance improved. Currently, the IPCC is traded at the level of 8.75x/1.23x PER/PBV.
3. DEPO IJ targets revenue of IDR2.9 trillion in FY23E (Kontan). MNCS Comment: This target represents a double digit growth of +12.7% YoY. Meanwhile, revenue in 1Q23 was IDR681.1 billion or only 23.5% realization. We are optimistic that the company can achieve this target in line with the expansion plan in the form of adding 3 new outlets which will bring the total outlet operations to 15 units in FY23E. Currently, DEPO is traded at the level of 32.40x/2.56x PER/PBV.
IHSG Updates
JCI weakened -0.22% to 6,681.75 on Tuesday (04/07), followed by net foreign sell reaching IDR125.66 billion. A number of sectors weakened and weighed on the index, led by the property sector (-0.44%) followed by the technology sector (-0.27%). On the other hand, the sector that led to strengthening was the cyclical sector (+0.90%) followed by the transportation sector (+0.81%). JCI turned negative in session 2, amidst mixed closing of the Asian stock exchanges. Negative sentiment came from the trade war conflict between China and the US which has increased again and is feared to continue, after China imposed restrictions on exports of gallium and germanium. The Rupiah closed higher at IDR14,993/USD. We estimate that the JCI will move in the price range of 6,650-6,700. Today's recommendation: HRUM, MPMX, PGAS, SMGR.
Corporate Actions
Cum Right Issue: AGRS (IDR100/share), MIDI (IDR270/share)
Cum Dividend: UNVR (IDR71/share)
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