Global Market Highlights
DJIA fell -0.32% on Friday (16/06), followed by the S&P500 (-0.37%) and the Nasdaq (-0.68%). Wall Street weakened amid the June 2023 release of Michigan consumer sentiment data which rose to 63.9 (vs 59.2 previously), as the market paid attention to the hawkish tone of the Fed, which called for further tightening to curb inflation. Today, the market will be looking toward several data releases such as: 1) US NAHB Housing Market Index Jun; 2) Germany 12-Month Bubill Auction; 3) Japan 52-Week Bill Auction.
Domestic Update
• The Ministry of Trade has decided on a CPO reference price for export levies for the period 16-30 June 2023 of USD723.45/Mt. MNCS Comment: The reference price fell -10.9% YoY (vs USD811.68/Mt in the previous period), so it will certainly have an impact on CPO issuers, especially those with exposure to export sales. We view this decline in line with the rate of decline in global prices (-15.6% YTD), and anticipate a future slowdown in demand. However, we see a potential upside risk going forward due to El-Nino.
Company News
1. SMRA IJ targets the acquisition of marketing sales value in FY23E to reach IDR5 trillion (Emiten News). MNCS Comment: SMRA recorded marketing sales in FY22 of IDR4.95 trillion, or tends to be flat with the target in FY23E. Meanwhile, until 4M23, the acquisition of marketing sales value reached IDR1.1 trillion, or the realization reached 22.3%, which was dominated by IDR2-5 billion type sales. Currently, SMRA is traded at the level of 10.40x/1.19x PER/PBV.
2. TINS IJ will allocate IDR950 billion of capex in FY23E, to pursue the production target of tin solder and chemical tin (Kontan). MNCS Comment: The capex allocation target has decreased compared to FY22 of IDR2 trillion, so it tends to result in a decline in operational performance. In 1Q23, sales volume fell -26% YoY while production fell -8% YoY. We also view that the -15% YoY price decline, as well as the slowing economic outlook of exporting countries will be a downside risk going forward. Currently, TINS is traded at the level of 36.29x/1.03x PER/PBV.
3. MORA IJ will focus on developing the Fiber To The Home (FTTH) business line in FY23E (IQ Plus). MNCS Comment: We view positively the company's efforts in the FTTH business line which has an attractive demand, so that it is hoped that this will encourage an increase in the company's revenue stream going forward. Currently, MORA is traded at the level of 13.82x/1.87x PER/PBV.
IHSG Updates
JCI weakened -0.23% to 6,698.55 on Friday (16/06), followed by net foreign sell of IDR880.60 billion. The majority of sectors experienced weakness and weighed on the index, led by the health sector (-0.66%) followed by the infrastructure sector (-0.60%). On the other hand, the sector leading the strengthening was the technology sector (+2.74%) followed by the raw materials sector (+0.42%). The index weakened in the midst of strengthening Asian bourses, where investors tended to wait and see ahead of the benchmark interest rate decision through Bank Indonesia's RDG on June 21-22. The Rupiah closed higher at IDR14,935/USD. We estimate that the JCI will move in the price range of 6,660-6,744. Today's recommendation: AGII, ARTO, INTP, LPPF.
Corporate Actions
IPO: VKTR (IDR100/share)
Cum Dividend: HMSP (IDR54.7/share), SGRO (IDR198/share)
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