Global Market Highlights
The DJIA weakened by -1.12% on Friday (27/10), followed by S&P500 (-0.48%) while Nasdaq (+0.36%). Wall Street closed with a mixed performance, as the yield on UST 10Y increased to 4.84%. Furthermore, concerns about geopolitical tensions in the Middle East escalated following the attack on Iranian military facilities by US. Today, the market will be looking toward several data releases such as: 1) Germany Inflation Rate Prel YoY Oct-23; 2) US Dallas Fed Manufacturing Index Oct-23; 3) AUS Retail Sales MoM Prel Sep-23.
Domestic Update
Bank Indonesia (BI) reported that, based on transactions from October 23-26, 2023, non-residents in the domestic financial market recorded a net buy of IDR1.04 trillion. This consisted of a net buy of IDR2.18 trillion in bond market, a net sell of IDR2.57 trillion in stock market, and a net buy of IDR1.44 trillion in SRBI. MNCS Comment: We observed an inflow in the bond market due to the yield levels being around 7%, providing an opportunity for the market to entry. Meanwhile, there was an outflow from the stock market due to BI's decision to raise the interest rate by +25 bps to 6.0% and continued depreciation of the Rupiah. These factors were perceived as negative by the market.
Company News
1. CMRY IJ reported a +10.0% YoY growth in net profit, reaching IDR966.6 billion in 9M23 (vs IDR878.6 billion in 9M22) (Emiten News). MNCS Comment: The increase in net profit was supported by a +20.7% YoY growth in revenue, reaching IDR5.7 trillion (vs IDR4.8 trillion in 9M22). However, we noted a margin contraction with GPM/NPM decreasing to 41.4%/16.8% (vs 42.5%/18.5% in 9M22). Currently, CMRY is traded at a level of 22.84x/5.19x PER/PBV.
2. SMSM IJ will distribute an interim cash dividend of IDR172.76 billion, equivalent to IDR30 per share (Emiten News). MNCS Comment: Hence, we estimate that SMSM will offer a dividend yield of 1.4%. SMSM has already distributed interim dividends three times, totaling IDR460.7 billion. With a net profit of IDR429.3 billion in 1H23, the payout ratio reaches 107.3%. Currently, SMSM is traded at a level of 13.30x/3.92x PER/PBV.
3. ELSA IJ posted a net profit of IDR406.6 billion in 9M23, an increase of +39.9% YoY (vs IDR290.6 billion in 9M22) (Emiten News). MNCS Comment: The increase in net profit was supported by a +4.8% YoY growth in revenue, reaching IDR9.0 trillion (vs IDR8.6 trillion in 9M22). Additionally, positive performance was also driven by improved margins. GPM/NPM of the company increased to 9.7%/4.5% (vs 7.7%/3.4% in 9M22). Currently, ELSA is traded at a level of 6.00x/0.75x PER/PBV.
IHSG Updates
The JCI strengthened by +0.66% to 6,758.79 on Friday (27/10), followed by a net foreign sell of IDR540.54 billion. Several sectors saw gains and driving the index, led by the infrastructure sector (+3.01%), followed by the energy sector (+1.43%). On the other hand, sectors that weakened were led by the property sector (-0.45%) followed by the industrial sector (-0.37%). The index's rise is in line with most Asian markets, where investors responded positively to the earnings reports of companies in 3Q23. Additionally, investors will adopt a wait and see approach in anticipation of early-month macroeconomic data. The Rupiah closed lower at IDR15,940/USD. We estimate the IHSG will move within the price range of 6,730-6,825. Today's Recommendations: ASII, ENRG, EXCL, INDF.
Corporate Actions
EGMS: CKRA, META
Cum Dividend : MARK (IDR5/share)
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