Global Market Highlights
The DJIA strengthened by +0.32% on Friday (10/05), followed by the S&P 500 (+0.16%). Meanwhile, the Nasdaq closed flat (-0.03%). Wall Street closed with modest advances as investors are digesting the data shown by The University of Michigan, where the 5Y inflation is expected to heat up to 3.1% in May-2024 (vs 3% in Apr-2024), while the consumer sentiment preliminary fell to the lowest in six months at 66.5 bps in May-2024 (vs 76/75 in Apr-2024/forecast). The mixed results stirred uncertainty of market positions in the rate cut expectation. Today the market will be looking forward to several data releases such as: 1) Indonesia Consumer Confidence Apr-2024; 2) US Consumer Inflation Expectations Apr-2024; 3) China Current Account Preliminary 1Q24.
Domestic Update
The Indonesian Motorcycle Industry Association (AISI) reported that motorbike sales in Indonesia increased by +18.3% YoY to 419,100 units (vs. -7.8% YoY in Mar-2024). MNCS Comment: On a YoY basis, this marked the first positive growth in motorbike sales in eight consecutive months. However, on a MoM basis, the sales plummeted -28.2% from 584,000 units in the previous month, pressured by the inflated price of staple food. AISI expects domestic sales to achieve 6.2-6.5 million units this year (vs 6.1-6.2 million in FY23), following the expectation of increasing employment rates this year.
Company News
1. CTRA IJ reported a net profit increase of +17.1% YoY to IDR483.4 billion in 1Q24 (vs IDR412.9 billion in 1Q23) (Emiten News). MNCS Comment: We noted that the increase in net profit was mainly supported by a revenue increase of +8.7% YoY to IDR2.3 trillion (vs IDR2.1 trillion in 1Q23). The increase in financial income by +53.1% YoY also contributed to profitability. Additionally, we observed an increase in margins, with the company's GPM/OPM rising to 50.9%/33.9% (vs 48.5%/32.4% in 1Q23). CTRA is currently trading at 11.07x/1.05x PER/PBV.
2. SGRO IJ recorded a net profit increase of +31.6% YoY to IDR100.3 billion in 1Q24 (vs IDR76.2 billion in 1Q23) (Emiten News). MNCS Comment: The increase in net profit occurred despite a decrease in revenue by -19.1% YoY, accompanied by a decrease in COGS by -23.5% YoY. This led to a slight increase in the gross profit by +2.3% YoY. Additionally, relatively manageable OPEX (+3.4% YoY) and an increase in other operating income (+27.1%) contributed to the rise in net profit. OPM/NPM increased to 15.8%/8.8% in 1Q24 (vs 9.5%/5.4% in 1Q23). SGRO is currently trading at 9.02x/0.68x PER/PBV.
3. AALI IJ prepares up to IDR1.4 trillion for capex in FY24 (Kontan). MNCS Comment: ~50.0% of the capex budget will be allocated for replanting, while the rest will be utilized for factory maintenance and vehicle replacement. As of 1Q24, AALI has absorbed ~12.7% (IDR178 billion) of the total capex budget. From the earnings standpoint, AALI booked flattish revenue of IDR4.8 trillion (+0.8% YoY) and net income of IDR230.5 billion (+2.6% YoY). Management remains optimistic to achieve the target of 5% growth this year, following the expectation of increasing selling price of CPO which contributes to 94.6% of the total sales as of 1Q24. AALI is currently trading at 0.52x PBV.
IHSG Updates
The JCI closed on Friday's trading (10/05) due to the Ascension of Jesus Christ holiday. Meanwhile, Asian markets on Friday's trading (10/05) showed solid gains, supported by the strengthening on Wall Street amid increased expectations of a rate cut in response to rising unemployment claims figures. Domestically, investors will wait and see ahead of the release of several macroeconomic data including the Consumer Confidence Index Apr-2024, retail sales performance Mar-2024, and the trade balance Apr-2024. The Consumer Confidence Index and retail sales performance are expected to remain solid due to the Eid momentum. Meanwhile, the trade balance is anticipated to remain surplus as prices of key commodities like coal increase. The Rupiah closed hugher at IDR16,045/USD on Wednesday's (08/05). We estimate that the JCI will move in the price range of 7,061-7,117. Today's recommendations: EXCL, ITMG, TLKM, PGAS.
Corporate Actions
Cum Dividend: ASII (IDR421/share), PLIN (IDR85/share)
AGMS: HEAL
Disclaimer On
