Global Market Highlights
DJIA fell -0.54% on Wednesday (09/08), followed by the S&P500 (-0.70%) and the Nasdaq (-1.17%). Wall Street has continued its correction, which is still influenced by rating cuts. In addition, investors are in a wait-and-see mode leading up to the release of inflation data for Jul-2023, which is expected to increase according to the consensus at +3.3% YoY. Today, the market will be looking toward several data releases such as: 1) US Inflation Rate Jul-2023; 2) US Core Inflation Rate Jul-2023; 3) US CPI Jul-2023.
Domestic Update
• Bank Indonesia views retail sales performance in Jul-2023 to grow +6.3% YoY, while it tends to correct -4.6% MoM. MNCS Comment: We see that growth on a YoY basis will be supported by the food, beverage and tobacco group as well as the need for clothing. Meanwhile, on an MoM basis, the performance of spare parts and accessories will buffer, as 2W & 4W sales growth tends to be solid.
Company News
1. ADRO IJ recorded coal sales volume up to 1H23 reaching 32.6 million tons (Emiten News). MNCS Comment: Coal sales volume increased +18.6% YoY (vs 27.5 million in 1H22). Meanwhile, with a sales volume target of 62 - 64 million tons, realization up to 1H23 reached 53.9% - 52.2%. We are optimistic that production volume growth will sustain this target, supported by the favorable weather factor. Currently, ADRO is traded at the level of 2.08x/0.79x PER/PBV.
2. SIDO IJ will revise its financial performance target in FY23E, after previously targeting revenue/net profit growth of 10% YoY (Investor). MNCS Comment: In 1H23, SIDO recorded revenue/net profit growth of +2.6% YoY/+0.6% YoY respectively. We see this growth revision as the outlook tends to be challenging, such as drier weather due to El-Nino resulting in less product sales being absorbed in the Herbal segment, as well as headwinds on exports to Nigeria. Currently, SIDO is traded at the level of 21.42x/5.88x PER/PBV.
3. AUTO IJ reported absorbing capex allocation of IDR241 billion up to 1H23 (Emiten News). MNCS Comment: The capex absorption reflects the achievement of 39.3% of our target in FY23E. We expect an increase in capex realization in 2H23, especially in EV supporting infrastructure facilities. Currently, AUTO is traded at the level of 10.37x/1.35x PER/PBV.
IHSG Updates
JCI strengthened +0.09% to 6,875.11 on Wednesday (09/08), followed by net foreign buy reaching IDR816.55 billion. A number of sectors experienced strengthening and boosted the index rate, led by the non-cyclical sector (+0.58%) followed by the infrastructure sector (+0.42%). On the other hand, sectors that experienced a decline were led by the technology sector (-2.18%) followed by the transportation sector (-1.53%). The index strengthened amid mixed Asian stock exchanges, where investors responded positively to the release of retail sales data in Jun-2023 which grew +7.9% YoY. The Rupiah closed higher at IDR15,191/USD. We estimate that the JCI will move in the price range of 6,860-6,892. Today's recommendation: AKRA, ASII, BBRI, EXCL.
Corporate Actions
IPO: MSIE (IDR100/share)
RUPS: MDIA
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