Global Market Highlights
DJIA rose +0.74% on Tuesday (22/03), followed by the S&P 500 (+1.13%) and Nasdaq (+1.95%). Wall Street appreciated as market players' optimism about the US economy remained solid in the face of the Fed's more aggressive interest rate hike plan. In addition, Wall Street's pace was also accompanied by the situation in Russia and Ukraine, who are currently still undergoing dialogue between the two countries. Today, the market will be looking toward several data releases such as: 1) US MBA Mortgage Applications; 2) UK Core Inflation Rate YoY; 3) UK Inflation Rate YoY.
Domestic Update
• Government has issued IDR2.8 trillion of Sharia Securities through auction on Tuesday (03/22/22). The total incoming bids were IDR13.39 trillion. MNCS Comment: The total awarded value was significantly lower than the indicative target at IDR9 trillion. The total incoming bids were also lower than the previous auction of IDR15.3 trillion on March 08, 2022. We believe that the global monetary policy tightening as well as heightened geopolitical tension will affect investors' appetite.
• Furthermore, the second dose of vaccination rate nationally has reached 74.1% or equivalent to 154.42 million people.
Company News
1. AKRA IJ recorded revenue of IDR25.70 trillion, up +45% YoY in FY21 (vs IDR14.14 trillion in FY20). Meanwhile, net profit was recorded at IDR1.1 trillion, up +20.23% YoY in FY21 (vs IDR924.91 billion in FY20) (Kontan). MNCS Comment: We see that this achievement was supported by the revenue increase in basic chemical and fuel products segment by +46.20% YoY in FY21 to IDR23.71 trillion. In addition, the company's sales target in JIIPE industrial land for this year is 40 hectares, thus JIIPE's contribution to the company's revenue is expected to increase in FY22E. AKRA is trading at the level of 3.00x/0.36x PER/PBV.
2. WTON IJ recorded a new contract value of IDR1.03 trillion until the end of Feb-22, equivalent to 14% of this year's target of IDR7.35 trillion. This was obtained from the infrastructure, industry, property, mining and other sectors, where the infrastructure contributes 60% - 70% (Kontan). MNCS Comment: We see that the company has the potential to improve its performance this year, along with the economic recovery that can encourage the acceleration of infrastructure development, thus that the company is expected to increase its project earnings. WTON is trading at the level of 22.50x/0.55x PER/PBV.
3. BBRI IJ targets credit growth of +9% YoY to +11% YoY in line with the increasing household consumption and commodity prices in FY22E (IQ Plus). MNCS Comment: We see that the company is optimistic by setting a higher target compared to the national banking loan growth target of +6% YoY to +8% YoY in FY22E. BBRI is trading at the level of 22.64x/2.44x PER/PBV.
IHSG Updates
JCI rose +0.66% to 7,000.82 on Tuesday (22/03), followed by net foreign buy which reached IDR730.26 billion. All sectors advanced in the green zone with gains led by the raw materials sector (+1.99%) followed by the energy sector (+1.68%). Throughout history, JCI managed to close at the level of 7,000. The catalysts driving the index strengthening were the strengthening of Asian markets such as the Nikkei (+1.48%), Hang Seng (+3.15%), and Shanghai (+0.19%). Meanwhile, rising commodity prices such as crude oil and CPO also contributed to the strengthening of the JCI. On the other hand, the Rupiah exchange rate closed lower at IDR14,357/USD. We estimate that the JCI will move in the price range of 6,926-7,000. Today’s recommendation: ERAA, MLIA, MYOR, DOID.
Corporate Action
Cum Dividend: BBNI (IDR146.30/share)
RUPS: IBFN, BBKP
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