Global Market Highlights
DJIA fell -1.40% on Monday (5/12), followed by the S&P500 (-1.79%) and the Nasdaq (-1.93%). Wall Street weakened as investors grew concern for the potential aggressive monetary tightening by The Fed, after the release of data New Factory Orders in Oct-2022 which grew +1.00% MoM, higher than the consensus estimate of 0.7% MoM and the highest ever last 4 months. Today, the market will be looking toward several data releases such as: 1) US Balance of Trade Oct; 2) UK S&P Global/CIPS Construction PMI Nov; 3) Germany S&P Global Construction PMI Nov.
Domestic Update
• Bank Indonesia (BI) foresees banking Third Party Funds (DPK) could grow at an annual pace of 7.9-8.1% in 2023. MNCS Comment: We see that TPF growth will be driven by 2 factors, namely credit growth in line with banking loose liquidity and monetary policy transmission which triggers an increase in deposit rates, especially time deposits.
• Furthermore, the national Covid-19 daily rate had increased by 2,234 active cases (5/12).
Company News
1. SIMP IJ posted net profit growth in 9M22 of +59.1% YoY to IDR896.3 billion billion (vs IDR563.2 billion in 9M21) (Emiten News). MNCS Comment: Even though revenue in 9M22 decreased -12.7% YoY, we see an increase in SIMP's net profit supported by: 1) increase in other operating income by +153.0% YoY; 2) decrease in financial expenses by -13.7% YoY; 3) decreased tax rate to 35.7% in 9M22 (vs 45.6% in 9M21). Currently, SIMP is traded at the level of 5.58x/0.41x PER/PBV.
2. AMRT IJ reported that the addition of new outlets up to 10M22 reached 1,102 outlets with a capex absorption of IDR2.62 trillion (Market Bisnis). MNCS Comment: Thus, the addition of the company's outlets has exceeded the target in FY22E of 1,000 outlets, bringing the total number of Alfamart outlets to 17,594 units with realized capex in FY22E reaching 74.9%. It is hoped that through the expansion of these outlets, it can accelerate the company's revenue going forward. Currently, AMRT is traded at the level of 51.93x/12.43x PER/PBV.
3. HRUM IJ will distribute an interim dividend for the FY22E fiscal year of IDR1.00 trillion, or equivalent to IDR75.10 per share, with cum dividend date for the regular market and negotiations on 13 December 2022 (Market Bisnis). MNCS Comment: Therefore, HRUM will offer a dividend yield of 4.2%. With the BI middle rate on December 5, 2022 of IDR15,429/USD, the dividend distribution amounted to USD64.8 million, or a payout ratio of 27.3% of net profit in 9M22 of USD237.4 million. Currently, HRUM is traded at the level of 9.48x/1.04x PER/PBV.
IHSG Updates
JCI weakened -0.46% to 6,987.33 on Monday (5/12), followed by net foreign sell which reached IDR1.63 trillion. The majority of sectors experienced weakening and weighed on the index, led by the technology sector (-4.07%) and followed by the industrial sector (-1.81%). On the other hand, the only sector that experienced gain was the energy sector (+1.30%). The weakening of the index was in line with the weakening of some Asian bourses and Wall Street. We see investors responding negatively to the release of PMI Services China data in Nov-2022 which fell to a level of 46.7 points or is still at its recession level (vs 48.4 points in Oct-2022). On the other hand, the Rupiah exchange rate closed lower at the level of IDR15,468/USD. We estimate that the JCI will move in the price range of 6,960-7,000. Today's recommendation: CPIN, ELSA, INDF, INKP.
Corporate Actions
Cum Dividend: IPCM (IDR3.68/share), SICO (IDR1/share)
IPO: MMIX (IDR190/share)
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