Global Market Highlight
DJIA rose by +0.93% on Thursday (06/05) followed by S&P 500 (+0.82%) and Nasdaq (+0.37%). Wall Street rose as cyclical stocks continued to be supported by economic optimism after jobless claims fell sharply, while technology stocks advanced ahead of the close of the April jobs report. Unemployment fell 92,000 to 498,000 people, the forecast for that fell to 540,000. Moreover, the market will look forward to several data releases today, such as: 1) US Unemployment Rate; 2) US Non Farm Payrolls; 3) China Caixin Composite PMI.
Domestic Update
• OJK recorded credit restructuring as of Mar-21 reached IDR 808.75 trillion from 5.55 million affected debtors. The largest portion in the MSME sector with outstanding restructuring reached IDR310.5 trillion from 3.89 million debtors. In addition, restructuring of finance companies up to April 26, 2021 reached IDR 198.27 trillion from 5.09 million restructuring contracts. The role of restructuring is very large in reducing the level of bad credit from both banks and finance companies, so that the stability of the financial services sector is well maintained (CNBC Indonesia).
• Furthermore, there was an addition of 905 new Covid-19 cases in Jakarta yesterday.
Company News
1. BRIS IJ disbursed financing of IDR159 trillion in 1Q21, up 14.74% YoY (vs IDR138.6 trillion in 1Q20). The largest composition of financing was contributed by the consumer segment amounting to IDR71.6 trillion or 45% of the total financing, the Corporate segment 23.5%, the small and medium segment 13.1%, the micro 9.4%, and the Commercial 6.1%. So that BRIS recorded a net profit of IDR742 billion 1Q21, up 12.85% YoY (vs IDR657 billion in 1Q20) (CNBC Indonesia). MNCS Comment: We estimate that the increase in profit will be driven by optimal financing expansion and increase in low cost of funds. The quality of financing was observed to improve with NPF gross down to 3.09% in 1Q21 (vs 3.35% in 1Q20). Currently BRIS is trading at 96.61x/4.40x PE/PBV.
2. AGRO IJ posted net interest income of IDR212.53 billion in 1Q21, increase +12.21% YoY (vs IDR189.41 billion in 1Q20). However, the provision fee increased from IDR88.80 billion in 1Q20 to IDR116.04 billion in 1Q21. AGRO posted a net profit of IDR17.87 billion in 1Q21 which increased by +6.5% YoY (vs IDR16.70 billion in 1Q20) (Investor Daily). MNCS Comment: We see that AGRO will still record good performance throughout FY21E, supported by the development of digital banking and maintained asset quality, where NPL can be reduced to the level of 4.76%. AGRO is currently trading at 280.73x/4.73x PE/PBV.
3. TINS IJ posted revenue of IDR 2.44 trillion in 1Q21, down -44% YoY (vs IDR 4.42 trillion in 1Q20). The cost of revenue was successfully suppressed from Rp4.62 trillion in 1Q20 to Rp2.12 trillion in 1Q21. TINS recorded a net profit of IDR10.34 billion 1Q21, a significant increase (vs loss of IDR412.86 billion in 1Q20) (IQ Plus). MNCS Comment: It seems that TINS has managed to cut their cost and improve their bottom line. We believe the performance for the rest of the year will be better with the increasing tin price. TINS is trading at 339.34/2.78x PE/PBV.
IHSG Updates
JCI slipped by -0.09% to 5,970.24 on Thursday (06/05) followed by net foreign buy reaching IDR181.97 billion. JCI slipped again amid the strengthening on global and regional indices. While, some sectors still managed to rise, including healthcare, financial, technology, infrastructure and transportation. Meanwhile, the Rupiah exchange rate was strengthening at IDR14,319. We estimate JCI will move in the range of 5,930-6,000 while waiting for foreign exchange reserve data release. Today's recommendation: EXCL, CPIN, INDY, SMGR.
Corporate Action
Cum Dividend Date: INCO (IDR48.28/share), CCSI (IDR7.5/share), EAST (IDR1.5/share)
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