Global Market Highlights
DJIA strengthened by +0.05% on Monday (06/06), followed by S&P500 (+0.31%) and Nasdaq (+0.40%). The positive catalyst came from a positive global economic outlook after the reopening of the lockdown in China. Furthermore, investors are watching the release of China's PMI services data version of Caixin in May-22 which was recorded at the level of 41.4 points (vs 36.2 in Apr-22). Today, the market will be looking toward several data releases such as: 1) US Balance of Trade; 2) US Imports & Exports; 3) UK S&P Global/CIPS UK Services PMI Final.
Domestic Update
• The Ministry of Energy and Mineral Resources set the reference coal price at USD323.91/ton (+17% MoM) in June 2022, marking the highest price in history. MNCS Comment: The increase in domestic reference coal price follows the increase in global coal prices which also strengthened in line with the electricity crisis in India due to the heat wave.
• Furthermore, the second dose of vaccination rate nationally has reached 80.5% or equivalent to 167.70 million people.
Company News
1. ZYRX IJ will distribute cash dividends of IDR10.46 billion or IDR7.85 per share, payout ratio of 14.99% (Kontan). MNCS Comment: Thus, ZYRX offers a dividend yield of 1.6%, having never distributed dividends before. ZYRX is currently trading at 47.22x/3.13x PER/PBV levels.
2. HEAL IJ will do an expansion this year by adding: 1) 3-4 new hospitals; 2) 600 new beds; 3) 2 Center of Excellence in Cardiology (Kontan). MNCS Comment: In FY21, the number of the company's hospitals reached 43 units and the number of beds was 5,877, with the expansion plan, the number of hospitals has the potential to increase to 46-47 units and a bed capacity of 6,477 units. It is hoped that this addition can encourage better company performance in the future. Currently, HEAL is trading at 46.01x/6.36x PER/PBV.
3. HRUM IJ will increase the realization of capex absorption this year to pursue production targets. It was recorded that up to 1Q22 the company's total realized capex was USD1.1 million (Bisnis). MNCS Comment: With a capex allocation target of USD25 million in 2022, until 1Q22, only 4.4% has been realized. It is hoped that the increase in capex will encourage the company's production rate this year, where sales volume recorded a decrease of -10.6% QoQ in 1Q22. Currently, HRUM is trading at the level of 8.74x/4.01x PER/PBV.
IHSG Updates
JCI weakened by -1.20% to 7,096.58 on Monday (06/06), followed by net foreign buy which reached IDR396.84 billion. Majority of sectors weakened and weighed on the index's pace, led by the technology sector (-4.35%) followed by the financial sector (-1.25%). On the other hand, the strengthening sector was led by the health sector (+1.64%) followed by the property sector (+0.73%). The potential for an increase in US interest rates by 50 bps on June 14-15, after several releases of solid US economic data, became a negative sentiment for the index movement. On the other hand, the Rupiah exchange rate closed lower at IDR14,452/USD. We estimate that the JCI will move in the price range of 7,030-7,120. Today's recommendation: ICBP, SMGR, TBIG, UNTR.
Corporate Action
Cum Dividend: TLKM (IDR149.97/share), PGAS (IDR124.42/share), TOWR (IDR18.1/share)
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