Global Market Highlights
DJIA strengthened +0.22% on Monday (17/07), followed by the S&P500 (+0.39%) and the Nasdaq (+0.93%). Wall Street managed to rebound following the release of NY Empire State Manufacturing Index data in Jul-2023 which managed to maintain a positive level of 1.1 (vs -4.3 on consensus), as well as a decline in UST yields. Today, the market will be looking toward several data releases such as: 1) US Retail Sales MoM Jun-2023; 2) US Industrial Production MoM Jun-2023; 3) US NAHB Housing Market Index Jul-2023.
Domestic Update
• The Central Bureau of Statistics noted that Indonesia's trade balance in Jun-2023 was a surplus of USD3.45 billion. MNCS Comment: Thus, Indonesia has managed to maintain a surplus trend for 38 consecutive months. The surplus in Jun-2023 was higher than May-2023 of USD 436.5 million, amid declining exports (-21.2% YoY) and imports (-18.4% YoY). In our view, the trade balance surplus is expected to moderate in the future, in line with the downward trend in commodity prices and the potential for the rupiah exchange rate to depreciate.
Company News
1. SMRA IJ recorded marketing sales realization of IDR1.6 trillion in 1H23 (Market Bisnis). MNCS Comment: The marketing sales decreased -30.4% YoY (vs IDR2.3 trillion in 1H22). Given the projected marketing sales target of IDR5 trillion for FY23E, the current realization stands at only 32%. We anticipate that marketing sales will likely moderate as we approach the political year, yet we believe SMRA possesses the potential to secure approximately a ~32% chance of recurring income for FY23E along with the projected increase in occupancy, which can boost the company's performance in the future. Currently, SMRA is traded at the level of 10.48x/1.20x PER/PBV.
2. ASII IJ recorded sales volume of 4W vehicles reaching 277,924 units as of 1H23 (Emiten News). MNCS Comment: We recorded sales of 4W vehicles increasing +7.4% YoY (vs 258,855 units in 1H22). With domestic 4W vehicle sales in 1H23 reaching 505,985 units, ASII held a market share of 54.9% (vs 54.7% in 5M23). Currently, ASII is traded at the level of 8.08x/1.22x PER/PBV.
3. MORA IJ realized IDR939.80 billion in IPO proceeds in 1H23, or 95.7% of the total IPO proceeds of IDR981.31 billion (Emiten News). MNCS Comment: The majority of funds have been realized for investments in devices, passive and active infrastructure and data center development amounting to IDR792.6 billion. Meanwhile, the remaining IPO proceeds were deposited in various banking institutions. We anticipate the accelerated use of IPO funds will enhance the company's better performance going forward. Currently, MORA is traded at the level of 13.65x/1.85x PER/PBV.
IHSG Updates
JCI closed relatively flat -0.04% to 6,867.14 on Monday (17/07), followed by net foreign buy reaching IDR1.2 trillion. The majority of sectors experienced weakening and weighed on the index, led by the health sector (-0.83%) followed by the non-cyclical sector (-0.64%). On the other hand, sectors that experienced strengthening were led by the energy sector (+0.86%) followed by the cyclical sector (+0.64%). The index closed flat amid the majority of Asian bourses closed in the red zone as investors were watching China's GDP growth in 2Q23 which was only +6.3% YoY, or below the consensus estimate of +7.3% YoY. The Rupiah closed lower at IDR15,005/USD. We estimate that the JCI will move in the price range of 6,829-6,897. Today's recommendation: BBRI, BRPT, IMJS, PTBA.
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