Global Market Highlights
The DJIA rose by +0.36% on Tuesday (04/06), followed by the S&P 500 (+0.15%) and Nasdaq (+0.17%). Wall Street strengthened solidly as job openings data for Apr-2024 fell to 8.06 million, lower than the figures for Mar-2024 and the consensus of 8.35 million/8.34 million. The lower figures rekindled hopes for a future rate cut. Additionally, factory orders in Apr-2024 rose by +0.7% MoM (vs the consensus of +0.6% MoM), acting as a positive catalyst for Wall Street. Today the market will be looking forward to several data releases such as: 1) China Caixin PMI Services May-2024; 2) US ADP Employment Change May-2024; 3) US ISM PMI Services May-2024.
Domestic Update
Indonesia's Manufacturing PMI in May-2024 was at the level of 52.1 points, down from 52.9 points in Apr-2024. MNCS Comment: Although Indonesia's Manufacturing PMI decreased in May-2024, it remained at an expansive level. We consider this decline to be reasonable due to normalization after the festive Lebaran period. The Manufacturing PMI in May-2024 was primarily influenced by slower output and new orders. Looking ahead, we expect Indonesia's Manufacturing PMI to maintain its expansive level, supported by macroeconomic stability and favorable demand.
Company News
1. MBMA IJ recorded a positive net profit of USD3.7 million in 1Q24 (vs a net loss of USD-7.0 million in 1Q23) (Kontan). MNCS Comment: We view this positive achievement as being in line with a revenue increase of +211.2% YoY to USD444.2 million (vs USD142.7 million in 1Q23). Additionally, a decrease in financial expenses and an increase in financial income and other income contributed to the company's improved profitability. GPM/OPM recorded a decline to 4.0%/2.4% (vs 8.3%/4.1% in 1Q23). MBMA is currently trading at 2.95x PBV.
2. AISA IJ recorded a net profit of IDR10.9 billion in 1Q24 (Kontan). MNCS Comment: This achievement marked a significant growth (+417.7% YoY), primarily supported by the modest growth in revenue (+2.6% YoY) and followed by the cost efficiency with COGS contracted by -9.1% YoY. The top-line was driven by the growth in the snacks segment (+9.4% YoY) and the food manufacturing segment (+1.1% YoY), which was in line with the management’s focus this year to increase production volume and quality by budgeting a capex of IDR105.8 billion. AISA is currently trading at 1.15x PBV.
3. HILL IJ signed the letter of intent with MBMA’s subsidiary, PT Sulawesi Cahaya Mineral (Kontan). MNCS Comment: This strategic collaboration resulted in a total of 9 nickel clients and hence is expected to boost the presence in the nickel market segment as a construction company. The management aims a total mining service of 17 million wmt nickel ore in FY24E (+25% YoY) with a revenue of IDR5 trillion where the nickel segment is estimated to make 40%-50% contribution. In 1Q24, the company booked a revenue of IDR788.9 billion, reflecting 15.8% of the target. HILL is currently trading at 4.47x PBV.
IHSG Updates
The JCI strengthened by +0.90% to 7,099.31 on Tuesday (04/06), despite a net foreign outflow of IDR45.62 billion. Most sectors gained and drove the index, with the consumer cyclicals sector leading at +1.23% and followed by the properties & real estate sector (+1.04%). On the other hand, the plummeted sectors were led by the energy sector (-1.39%) and followed by the technology sector (-1.05%). The index climbed amid mixed Asian markets, where investors responded to the slower inflation rate of Korea for May-2024 while also eyeing for the reading of several key macroeconomic indicators this week. The Rupiah continued its strengthening at IDR16,220/USD. We estimate that the JCI will move in the price range of 7,040-7,133. Today's recommendations: BRMS, ERAA, MIDI, UNVR.
Corporate Actions
Cum dividend: PGEO (IDR47.78/share), TCID (IDR94/share)
AGMS: CUAN
Disclaimer On
