Global Market Highlights
The DJIA strengthened by +0.59% on Monday (09/10), followed by the S&P500 (+0.63%) and Nasdaq (+0.39%). Wall Street continued its upward trend, with positive momentum coming from the dovish tone of The Fed signaling a pause in its rate hike cycle. Today, the market will be looking toward several data releases such as: 1) US Wholesale Inventories MoM Aug-2023; 2) Japan Eco Watchers Survey Current Sep-2023; 3) Japan Eco Watchers Survey Outlook Sep-2023.
Domestic Update
Bank Indonesia (BI) reported the Consumer Confidence Index for Sep-2023 decreased to 121.7 (vs 125.2 in Aug-2023). MNCS Comment: Even though the CCI declined, it still maintains its optimistic level (>100). We noted that the income expectation index for the expenditure group >IDR3.1 million showed positive growth, followed by the employment availability expectation index. Furthermore, the total consumption expenditure proportion increased +0.7 points to 76.3.
Company News
1. JSMR IJ plans to divest 35% of its stake in Tol Transjawa (Kontan). MNCS Comment: We note that the divestiture price has risen from USD300 million previously to USD750 million. With this divestiture opportunity, we anticipate a significant rise in the company's net profit. However, this doesn't rule out a possible margin contraction. Moreover, this divestment provides an opportunity for JSMR to expand in the future. Currently, JSMR is traded at a level of 13.62x/1.39x PER/PBV.
2. DEWA IJ recorded a net profit of IDR12.8 billion in 1H23 (vs a net loss of IDR118.2 billion in 1H22) (Kontan). MNCS Comment: There was a turnaround in the company's net profit in 1H23, accompanied by a revenue increase of +27.0% YoY. Additionally, we note that the margins have improved, where GPM/OPM expanded to 7.2%/2.9% in 1H23 (vs 2.4%/0.6% in 1H22). Currently, DEWA is traded at a level of 0.51x PBV.
3. CENT IJ completed the purchase of towers through its entity, Centratama Menara Indonesia (CMI), acquiring 397 units valued at IDR1.15 trillion (Emiten News). MNCS Comment: We view the company's acquisition effort to expand its tower portfolio positively. Meanwhile, we estimate the total tower portfolio to be around ~9.8k units. We expect that this addition can enhance the company's future performance.
IHSG Updates
The JCI rose slightly by +0.04% to 6,891.46 on Monday (09/10), accompanied by a net foreign buy of IDR85.81 billion. The majority of sectors saw gains, pushing the index forward, led by the energy sector (+2.88%) followed by the infrastructure sector (+2.46%). On the other hand, sectors that experienced declines were led by the healthcare sector (-2.15%), followed by the non-cyclical sector (-1.14%). The index rose in tandem with most Asian markets amid ongoing Middle East geopolitical conflicts. Investors responded positively to Wall Street's gains last weekend (06/10), in line with a generally positive employment market exposure. The Rupiah closed lower at IDR15,690/USD. We estimate the IHSG will move within the price range of 6,860-6,900. Today's Recommendations: ADRO, ELSA, HRTA, INCO.
Corporate Actions
IPO: STRK (IDR100/share)
Cum Dividend: UNTR (IDR701/share)
EGMS: ZYRX
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