Global Market Highlights
DJIA strenghtened +1.09% on Tuesday (31/01), followed by the S&P500 (+1.46%) and the Nasdaq (+1.67%). Wall Street strengthened supported by investor optimism about the potential for a slowdown in the FFR increase to 25 bps (vs the previous 50 bps) and a decrease in the yield of the US T-note 10Y to a level of 3.52%. Today, the market will be looking toward several data releases such as: 1) US Fed Interest Rate Decision; 2) US ISM Manufacturing PMI Jan; 3) US ADP Employment Change Jan.
Domestic Update
• The Deposit Insurance Corporation has effectively increased the rupiah deposit insurance interest rates at commercial banks and rural banks each +25 bps, to 4% for commercial banks and 6.5% for rural banks. MNCS Comment: We view this increase to adjust the potential for higher banking interest going forward and to open up space for liquidity management amidst the still high volatility.
Company News
1. BMRI IJ posted a consolidated net profit of IDR41.2 trillion in FY22, or grew +46.89% YoY (Emiten News). MNCS Comment: We see that this achievement was supported by: 1) credit growth +14.5% YoY to IDR1,202 trillion; 2) increase in NIM +0.4 ppt YoY to 5.5%. NPL fell to 1.92% (vs 2.72% in FY21). Currently, BMRI is traded at the level of 2.19x PBV.
2. INCO IJ reported nickel in matte production in FY22 of 60,090 metric tons (Emiten News). MNCS Comment: Realized production of nickel in matte fell -8.1% YoY (vs 65,388 metric tons in FY21). This decline was in line with the delay in project completion in Furnace 4. INCO is currently traded at the level of 21.57x/2.09x PER/PBV.
3. DMAS IJ recorded marketing sales of IDR1.86 trillion (Emiten News). MNCS Comment: Marketing sales achievement has grown +3.3% YoY and exceeded the target set by the company of IDR1.8 trillion. In our view, the development of a special zone for the data center industry will still support marketing sales performance going forward. Currently, DMAS is traded at the level of 7.82x/1.33x PER/PBV.
IHSG Updates
JCI weakened -0.48% to 6,839.34 on Tuesday (31/01), followed by net foreign sell reaching IDR671.97 billion. A number of sectors weakened and weighed on the index, led by the health sector (-1.07%) followed by the cyclical sector (-0.80%). On the other hand, sectors that experienced strengthening were led by the energy sector (+0.79%) followed by the technology sector (+0.36%). The weakening of the index was in line with the movement of Wall Street & Asian stock exchanges. We see investors tend to wait and see ahead of the release of inflation data in Jan-2023 which is estimated to slow down by consensus to +5.4% YoY (vs +5.51% YoY in Dec-2022). On the other hand, the Rupiah exchange rate closed lower at the level of IDR14,990/USD. We estimate that the JCI will move in the price range of 6,815-6,850 pending the release of Inflation Rate Jan, Core Inflation Rate Jan, Tourist Arrivals YoY Dec, and S&P Global Manufacturing PMI Jan data. Today's recommendation: DEWA, ESSA, EXCL, IMAS.
Corporate Actions
IPO: FWCT (IDR118/share)
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