Global Market Highlights
DJIA weakened -1.29% on Wednesday (23/03), followed by S&P 500 (-1.23%) and Nasdaq (-1.32%). Weaker technology stocks weighed on the performance of other stocks. The increase in oil prices is also a concern for market players. From economic data, Feb-22 new home sales fell -2.0% MoM to 772,000. Today, the market will be looking toward several data releases such as: 1) US Markit Manufacturing PMI Flash; 2) US Durable Goods Orders MoM; 3) UK Markit/CIPS Composite PMI Flash.
Domestic Update
• Government has ensured that VAT hike from 10% to 11% would be implemented starting from April 1, 2022. MNCS Comment: The 1 ppt increase in VAT would not affect inflation significantly. However, the moment of hike along with the revocation of cooking oil maximum retail price policy as well as Ramadan festivities could trigger an overshoot of inflation.
• Furthermore, the second dose of vaccination rate nationally has reached 74.7% or equivalent to 155.52 million people.
Company News
1. EXCL IJ acquired 51% shares of PT Hipernet Indodata (HI) or equal to 2,805 shares with a transaction value of IDR321.3 billion on 22 Mar-22. This acquisition aims to increase the range of products offered to customers in the enterprise segment (CNBC Indonesia). MNCS Comment: We see that through the acquisition of Hipernet as a managed service provider, the company can reach wider customers, which is expected to improve the company's performance in the future. EXCL is trading at the level of 22.49x/1.44x PER/PBV.
2. ASSA IJ prepared a capex of IDR1.5 trillion in FY22E, which was funded by bank loans. Most of the capex will be used for new car purchases (Kontan). MNCS Comment: We see that through the capex fund, the company is optimistic that it can improve its performance. In FY22E, the company targets revenue growth of +30% YoY along with the potential increase in consumer demand for car rental services. ASSA is trading at the level of 4.54x PBV.
3. BMRI IJ accelerates non-cash payment transactions by collaborating with Indomaret for the development of payment access by QRIS scan code in the Livin by Mandiri Super App (IQ Plus). MNCS Comment: We see that through this collaboration, the company can increase the number of QRIS transactions through the Livin by Mandiri application and reach a wider community. BMRI is trading the level of 12.95x/1.77x PER/PBV.
IHSG Updates
JCI weakened -0.07% to 7,996.11 on Wednesday (23/03), followed by net foreign buy which reached IDR811.56 billion. The majority of weakening sectors weighed on the JCI performance, led by the property sector (-0.67%) followed by the infrastructure sector (-0.63%). On the other hand, the sector that experienced strengthening was led by the transportation sector (+2.04%) followed by the energy sector (+1.67%). JCI depreciated triggered by negative catalysts that came from the IMF cutting its projection for Indonesia's economic growth for 2022 from 5.6% to 5.4%. This is still seen as positive, considering the trend of rising commodity prices which have a positive impact and the increase in community mobility which has stimulated economic recovery. 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 while waiting for M2 Money Supply YoY FEB data. Today’s recommendation: BBRI, MDKA, BBKP, ENRG.
Corporate Action
RUPS: WOMF, ITMG
Disclaimer On
