Global Market Highlights
The DJIA strengthened by +0.40% on Wednesday (14/02), followed by the S&P 500 (+0.96%) and the Nasdaq (+1.30%). Wall Street rebounded after the release of US Inflation showed an upside surprise, with the Consumer Price Index (CPI) rose by 3.1% YoY in Jan-24 (vs 3.4% in Dec-23), beating the market consensus of 2.9%. Today the market will be looking forward to several data releases such as: 1) US Retail Sales Jan-24; 2) US Initial Jobless Claims Feb-2024; 3) JP GDP Growth 4Q23.
Domestic Update
Bank Indonesia reported that the Jan-2024 Consumer Confidence Index (IKK) increased to 125.0 from 123.8 in Dec-2023, supported by improvements in the Economic Conditions Index (IKE) and Consumer Expectations Index (IEK). MNCS Comment: We view consumer expectations strengthened in line with strong public expectations regarding the prospects of the next government. At the same time, an increase in the portion of income allocated to savings and a decrease in credit uptake indicate that consumption of durable goods bodes a temporary slow down, in line with Chinese New Year celebrations in Feb-2024 and ahead of the Eid al-Fitr holiday.
Company News
1. ADMF IJ posted a net profit of IDR 1.94 trillion or grew +21.1% YoY in FY23 from IDR1.61 trillion in FY22 (Emiten News). MNCS Comment: We note that the company's revenue grew strongly +13.9% YoY to reach IDR 9.51 trillion, supported by growth in the murabahah margin segment (+24.2% YoY), consumer financing (+12.4% YoY), then other income (+7.7% YoY). Consumer credit growth in the era of high interest rates is in line with IKK which remains strong. The company's performance has the potential to grow this year in line with the possible start of a cycle of lower interest rates. ADMF is currently trading at 1.17x PBV.
2. BJTM IJ will distribute cash dividends for the FY23 fiscal year amounting to IDR816.7 billion, or equivalent to IDR54.39 per share. Cum dividend in the regular and negotiation markets on February 20, 2024 (Market Bisnis). MNCS Comment: Consequently, we estimate that BJTM will offer a dividend yield of approximately ~8.1%. Meanwhile, with a net profit of IDR1.5 trillion in FY23, the payout ratio reaches 55.6%. BJTM is currently trading at 0.86x PBV.
3. GGRM IJ continues expansion to the toll road business after completing the Kediri Airport (Kontan). MNCS Comment: To complement the Kediri Airport which operates this year, GGRM spreads its wings to the construction of toll roads in Kediri and Tulungagung through its new subsidiaries. While this diversification has no direct impact to the group’s performance yet, we view this news as a positive catalyst. The group booked+197.62% YoY bottom line growth in 9M23. GGRM is currently trading at 8.59x/0.64x PER/PBV.
IHSG Updates
JCI closed given the general elections on Wednesday (14/02). Meanwhile, the majority of Asian markets experienced declines following the release of US inflation data in Jan-2024, which grew +3.1% YoY, or higher than the consensus estimate of +2.9% YoY. Furthermore, the market will wait and see ahead of the release of trade balance data in Jan-2024, which estimated to remain a surplus of USD2.99 billion (vs USD3.3 billion in Dec-2023). The Rupiah closed higher at IDR15,595/USD. We estimate the IHSG will move within the price range of 7,180-7,251. Today's Recommendations: BIRD, ISAT, MIKA, SMRA.
Corporate Actions
IPO: BAIK (IDR278/share)
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