Global Market Highlights
DJIA strengthened +0.53% on Friday (23/12), followed by the S&P500 (+0.59%) and the Nasdaq (+0.21%). Wall Street rebounded as inflation expectations decreased for Dec-2022 to 4.4% from 4.9% previously. Moreover, New Home Sales managed to grow +5.8% MoM to 640k (vs 600k on consensus).
Domestic Update
• Based on transaction data December 19-22, 2022, non-residents on the domestic financial market sold a net of Rp0.04 trillion, consisting of a net purchase of Rp1.45 trillion on the SBN market and a net sale of Rp1.48 trillion on the stock market. MNCS Comment: The continued net buying action on the SBN market reflects more attractive yields for SBN, as well as safer assets switching in line with the potential for a global economic slowdown in 1H23 which has the potential to weigh on stock market performance.
• Furthermore, the national Covid-19 daily rate had increased by 538 active cases (25/12).
Company News
1. UNTR IJ reported that sales of Komatsu heavy equipment in November 2022 reached 370 units. Meanwhile, accumulated sales up to 11M22 amounted to 5,457 units (Market Bisnis). MNCS Comment: Despite Komatsu unit sales fell -33.1% MoM (vs 553 units in Oct-2022), cumulatively, the 11M22 sales of Komatsu heavy equipment reached 5,087 units, or increased +96.4% YoY and have exceeded sales target of 5,000 units. Currently, UNTR is traded at the level of 4.74x/1.26x PER/PBV.
2. ADMR IJ through its entity, PT Kalimantan Alumunium Industry (KAI), signed a conditional share acquisition agreement with Aumay and PT Cita Mineral Investindo Tbk (CITA) (Investor ID). MNCS Comment: We view this positively as an effort to accelerate the construction of an aluminum smelter which is targeted to be completed in 2025 for the first phase. After signing the agreement, ADMR's ownership in KAI will become 65%, Aumay to 22.5% and CITA to 12.5%. Currently, ADMR is traded at the level of 12.03x/9.39x PER/PBV.
3. RMKE IJ recorded that the volume of coal transported in 11M22 reached 6.94 million tons, while coal sales in the same period amounted to 2.20 million tons (Market Bisnis). MNCS Comment: Coal hauling volume increased 27.1% YoY (vs 5.46 million tonnes in 11M21) with realization reaching 88.8% of the FY22E target. Meanwhile, coal sales volume increased +46.7% YoY (vs 1 .50 million tonnes in 11M21), or realization has reached 97.1% of the FY22E target. Currently, RMKE is traded at the level of 11.14x/3.80x PER/PBV.
IHSG Updates
JCI weakened -0.35% to 6,800.67 on Friday (23/12), followed by net foreign sell which reached IDR773.72 billion. The majority of sectors experienced weakening and weighed on the index, led by the transportation sector (-0.77%) and followed by the industrial sector (-0.50%). On the other hand, the sectors that experienced strengthening were the property sector (+0.68%) followed by the raw materials sector (+0.47%). The weakening of the index was in line with the weakening of Wall Street. We see that market players tend to pay close attention to the release of solid data on the labor market and final US GDP in 3Q22, thus increasing speculation about a more hawkish stance by the Fed going forward. On the other hand, the Rupiah exchange rate closed lower at the level of IDR15,593/USD. We estimate that the JCI will move in the price range of 6,748-6,808. Today's recommendation: ADRO, ASII, BNBR, SMGR.
Corporate Actions
Cum Dividend: IPCC (IDR12.49/share)
Cum Rights: MTWI (IDR100/share)
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