Global Market Highlights
DJIA strengthened +0.13% on Friday (09/06), followed by the S&P500 (+0.11%) and the Nasdaq (+0.16%). Wall Street rallied ahead of the Fed's FOMC on June 13-14, where consensus expects that the Fed will hold its benchmark interest rate at 5.00%-5.25% with a probability of 71.2%. Today, the market will be looking toward several data releases such as: 1) US Monthly Budget Statement May; 2) US Consumer Inflation Expectations May; 3) Japan Machine Tool Orders YoY May.
Domestic Update
• Based on June 5-8 transaction data, Bank Indonesia reported a foreign net buy of IDR4.87 trillion on the domestic financial market, with a net buy of IDR4.79 trillion on the SBN market and a net purchase of IDR0.08 trillion on the stock market. MNCS Comment: On a YTD basis, foreign net purchases amounted to IDR73.3 trillion on the SBN market while equity net purchases grew to IDR19.1 trillion. We view that the foreign market still weighs on the high global interest rate environment and is reluctant to enter the yet blurry equity market momentum.
Company News
1. HMSP IJ will distribute cash dividends for the FY22 financial year of IDR6.4 trillion, or the equivalent of IDR54.7 per share (Emiten News). MNCS Comment: Thus, we estimate that HMSP will offer a dividend yield of 5.4%, or higher than the 5Y average of 4.9%. The amount of DPS decreased from the previous year (IDR63.3 per share) as the FY22 net profit performance decreased (-11.4% YoY), amidst an aggressive increase in excise tax rates. Currently, HMSP is traded at the level of 13.73x/3.91x PER/PBV.
2. ADHI IJ recorded a new contract value of IDR10.7 trillion in 5M23 with the engineering & construction business segment still the largest contributor, reaching 92% (Emiten News). MNCS Comment: Acquisition of new contract value in 5M23 increased +12.6% YoY (vs IDR9.5 trillion in 5M22). With a target of obtaining a new contract value in FY23E of IDR27.3-28.4 trillion, the realization reached 39.2% -37.7%. Currently, ADHI is traded at the level of 0.42x PBV.
3. UNTR IJ signed a share subscription agreement (SSA) to acquire 19.99% ownership in Nickel Industries Limited (NIC), through its entity, Danusa Tambang Nusantara (Emiten News). MNCS Comment: We view positively the business diversification efforts that are continuously being improved by the company, and aiming at ESG. With the USD/IDR exchange rate at IDR14,890, it is estimated that the transaction value will reach IDR14.0 trillion. Currently UNTR is traded at the level of 4.04x/0.98x PER/PBV.
IHSG Updates
JCI strengthened +0.42% to 6,694.02 on Friday (09/06), followed by net foreign sell of IDR287.57 billion. The majority of sectors experienced strengthening and drove the index rate, led by the property sector (+1.25%) followed by the technology sector (+1.22%). On the other hand, the sector that led to the decline was the raw materials sector (-0.74%) followed by the transportation sector (-0.29%). The index's gains were in line with Asian stock exchanges and Wall Street, where investors were watching China's inflation rate in May-2023 which is manageable at +0.2% YoY (vs consensus at +0.3% YoY), as well as the positive catalyst from the global GDP projection by OECD revised upwards to +2.7% YoY (vs +2.6% YoY prior). The Rupiah closed higher at IDR14,840/USD. We estimate that the JCI will move in the price range of 6,626-6,703 pending the release of Consumer Confidence May-2023 data. Today's recommendation: EXCL, PNLF, TOWR, WOOD.
Corporate Actions
Cum Dividend: MEDC (USD0.0016/share), TSPC (IDR100/share), HRTA (IDR12/share)
Disclaimer On
