Global Market Highlights
DJIA rallied +0.73% on Friday (25/08), followed by the S&P500 (+0.67%) and the Nasdaq (+0.94%). Wall Street managed to rebound, where investors responded positively to the neutral tone of The Fed at the Jackson Hole symposium. Meanwhile, inflation expectations in Aug-2023 rose again to 3.5% YoY (vs 3.3% YoY on consensus). Today, the market will be looking toward several data releases such as: 1) US Dallas Fed Manufacturing Index Aug-2023; 2) Japan Coincident Index Final Jun-2023; 3) Japan Leading Economic Index Final Jun-2023.
Domestic Update
• Bank Indonesia (BI) reported that banking credit growth in Jul-2023 reached 8.54% YoY. MNCS Comment: Banking credit growth rebounded from its Jun-2023 achievement of +7.76% YoY, bolstered by the social services sector, mining, and the business. However, this realization is still below the FY23E target range of 9% YoY - 11% YoY. We anticipate this year's credit growth to align with the target, given the continued ample liquidity in banking.
Company News
1. UNTR IJ posted net profit growth of +8.3% YoY to IDR11.2 trillion in 1H23 (vs IDR10.4 trillion in 1H22) (Emiten News). MNCS Comment: The growth in net profit was supported by an increase in revenue of +13.6% YoY. However, it was noted that all margins experienced a contraction as COGS/OPEX increased by +13.8% YoY/+31.6% YoY respectively. GPM/NPM to 27.2%/16.3% (vs. 27.3%/17.1% in 1H22). Currently, UNTR is traded at the level of 4.33x/1.35x PER/PBV.
2. SGER IJ will distribute an interim dividend of IDR115.0 billion or equivalent to IDR28 per share. Cum date on the regular market and negotiations on 4 September 2023 (Emiten News). MNCS Comment: Therefore, SGER will offer a dividend yield of 2.0%. Meanwhile, with net profit in 1H23 reaching IDR611.7 billion, the payout ratio reached 18.8%. Currently, SGER is traded at the level of 4.63x/3.47x PER/PBV.
3. LPPF IJ has opened a new outlet in Kediri Mall, East Java. This is the opening of the 8th store this year (Emiten News). MNCS Comment: We view the company's expansion positively, in which LPPF plans to open new outlets reaching 12-15 units in FY23E (vs 10 outlets in FY22). The capex allocation is estimated at IDR500 billion. It is hoped that this expansion can boost the company's performance going forward. Currently, LPPF is traded at the level of 4.45x PER.
IHSG Updates
JCI slightly weakened -0.06% to 6,895.44 on Friday (25/08), followed by net foreign sell reaching IDR513.06 billion. A number of sectors experienced weakening and weighed on the index, led by the industrial sector (-0.89%) followed by the energy sector (-0.85%). On the other hand, sectors that experienced strengthening were led by the transportation sector (+1.36%) followed by the infrastructure sector (+1.12%). The weakening of the index was in line with other Asian stock exchanges, where investors tended to wait and see before the Jackson Hole symposium. The Rupiah closed lower at IDR15,295/USD. We estimate that the JCI will move in the price range of 6,885-6,920 pending the release of M2 Money Supply YoY Jul-2023 data. Today's recommendation: AGII, DOID, PNLF, TKIM.
Corporate Actions
IPO: RSCH (IDR115/share)
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