Global Market Highlights
The DJIA weakened by -0.86% on Friday (20/10), followed by S&P500 (-1.26%) and Nasdaq (-1.53%). Wall Street experienced another decline amid the decrease in UST 10Y yield to 4.92%. Negative sentiment stemmed from the Israel-Hamas geopolitical conflict, which is feared to escalate further and trigger other conflicts in the Middle East. Today, the market will be looking toward several data releases such as: 1) Singapore Inflation Rate YoY Sep-23; 2) US Chicago Fed National Activity Index Sep-23; 3) EU Consumer Confidence Flash Oct-23.
Domestic Update
Foreign Direct Investment (FDI) Indonesia, excluding investments in banking and the O&G sector, recorded a growth of +16.2% YoY, reaching IDR196.2 trillion in 3Q23. MNCS Comment: This expansive FDI growth surpasses the 2Q23 achievement of +14.2% YoY. Meanwhile, domestic investment accumulated to IDR178.2 trillion. In total, the highest investment realization was in the basic metal industry, followed by mining and transportation and warehousing. We believe the increase in FDI can bolster the Rupiah's exchange rate in the mid-term.
Company News
1. PTPP IJ recorded new contract of IDR23.67 trillion until 9M23 (Market Bisnis). MNCS Comment: We note that the new contract has grown by +42.8% YoY (vs IDR16.6 trillion in 9M22). With a target of achieving new contract values of IDR 34 trillion in FY23E, the realization until 9M23 reached 69.6%. Currently, PTPP is traded at a level of 22.34x/0.38x PER/PBV.
2. IPCC IJ posted a net profit growth of +30.3% YoY, reaching IDR141.9 billion in 9M23 (vs IDR108.9 billion in 9M22) (Emiten News). MNCS Comment: This net profit growth is supported by a +7.8% YoY increase in revenue, reaching IDR548.2 billion (vs IDR508.3 billion in 9M23). Moreover, there is an expansive margin, with OPM/NPM at 34.5%/25.9% (vs 33.6%/21.4% in 9M22). This is backed by a reduction in OPEX (-3.6% YoY) and a lower tax rate. Currently, IPCC is traded at a level of 7.30x/1.14x PER/PBV.
3. BTPS IJ reported a -24.4% YoY drop in net profit to IDR1.0 trillion in 9M23 (vs IDR1.3 trillion in 9M22) (Emiten News). MNCS Comment: This performance decline is primarily due to an increase in BOPO to 70.6% (vs 57.5% in 9M22). Additionally, NPF (gross) increased to 3.0% (vs 2.4% in 9M22), and there was a +94% YoY increase in net financing loss. Currently, BTPS is traded at a level of 1.42x PBV.
IHSG Updates
The JCI edged up by +0.04% to 6,849.17 on Friday (20/10), followed by a net foreign sell of IDR288.56 billion. Several sectors experienced declines and weighed on the index, led by the technology sector (-1.66%), followed by the transportation sector (-1.65%). On the other hand, sectors that gained ground were led by the health sector (+0.23%), followed by the financial sector (+0.14%). The index managed a slight increase amidst a weak Asian market. Investors are closely monitoring the positive FDI data in 3Q23 and taking a wait-and-see approach ahead of the 3Q23 earnings season. The Rupiah closed lower at IDR15,875/USD. We estimate the IHSG will move within the price range of 6,828-6,885. Today's Recommendations: CPIN, ESSA, UNTR, UNVR.
Corporate Actions
EGMS: JAWA
AGMS : ELTY
Cum Dividend: AVIA (IDR11/share)
Disclaimer On
