08 Juni 2020
MNCS Morning Navigator 08 June 2020
Global Market Highlight
DJIA rose by +3.15% on Friday (08/06) followed by the increase of S&P 500 (+2.62%) and Nasdaq (+2.06%). These increases were due to a record of 2.5 million new jobs in May, bringing the unemployment rate to 13.3%, according to US Labor Department data. This beats economists' projections in a Dow Jones poll that estimates there are 8 million jobs, and an unemployment rate of 20%. This is also followed by the rise in the stock prices of JP Morgan, Citigroup, Wells Fargo and Bank of America by at least 7%. The market will look forward to several data releases today, such as: 1) Japan GDP Growth per May-2020; 2) US Consumer Inflation Expectations per May-2020; 3) Germany Industrial Production per May-2020.
Domestic Updates
Bank Indonesia (BI) predicted that inflationary pressures will be decline in June 2020. Based on a price monitoring survey conducted by the central bank in the first week of this month, inflation is expected to be 0.04% MoM or if on an annual basis 1.81% YoY. This is related to decreased public demand due to large-scale social restrictions (PSBB) imposed by the government. PSBB inhibits community economic activities that cause community income to be eroded, thereby affecting demand. (Kontan)
Company News
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PPRE will be distributing dividends IDR66.3 billion or equals to 20% of net profit in FY19 which reached IDR331.3 billion. Dividend per share is at the level of IDR6.5/share with 3.01% yield. Cum date will be at June 11, 2020. (Kontan) MNCS Comment: Covid-19 pandemic caused business instability in the construction industry, PPRE was quite good in regulating financial position by providing dividends, besides that PPRE also still did a buyback to maintain investor confidence. PPRE is traded at 6.75x/0.88x PE/PBV, lower than peers.
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WSKT will distribute IDR46 billion of dividends with 5% payout ratio compared to 25% payout ratio on FY19. Dividend per share stood at IDR3.45/share which makes dividend yield at 0.5%. (Market Bisnis) MNCS comment: The election in 2019, causing some projects and tenders to experience delays; this causes WSKT net profit in fiscal year 2019, lower than the previous year. WSKT is traded at 10.63x/0.56x PE/PBV, lower than peers.
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ITIC recorded sales IDR44.91 billion in 1Q20 grew by by 17.5% YoY. The company's local sales were recorded at IDR45.28 billion, an increase compared to 1Q19 of IDR38.17 billion. On the other hand, export sales fell to IDR338.91 billion, from IDR710.18 billion in 1Q19. Thus, ITIC managed to record a net profit of IDR1.78 billion in 1Q20 (vs net loss of IDR1.25 billion in 1Q19). (IDNFinancial) MNCS Comment: We see that ITIC can be a potential substitute to regular cigarette in the modern market. ITIC is traded at 6.63x PBV.
IHSG Updates
JCI increased by +0.63% to 4,947.78 on Friday (08/06) despite a net foreign sell reaching IDR51 billion. The increase was caused by the large scale social restriction transition in several areas in Indonesia where in the phase I, markets and shopping centers can be opened gradually in the third week of June 2020 and operate with a capacity of only 50%. Meanwhile, the Rupiah exchange rate against the USD was appreciated at IDR13,878. We estimate JCI will move in the range of 4,880-5,040 while waiting for Retail Sales as of Apr-2020. Today's recommendation: ISAT, INDF, KLBF, AALI.
Corporate Action
Ex Dividend Date: ITMG
RUPS: IMAS, IMJS
Disclaimer On
ISAT,
INDF,
KLBF,
AALI,
PPRE,
WSKT,
ITIC
