Global Market Highlights
The DJIA fell by -0.03% on Thursday (05/10), followed by the S&P500 (-0.13%) and Nasdaq (-0.12%). Wall Street contracted, driven by growing market concerns regarding potential interest rate hikes, spurred by a still solid job market. Notably, initial unemployment claims as of 30-Sep were 207k, coming in below the consensus estimate of 210k. Today, the market will be looking toward several data releases such as: 1) US Non Farm Payrolls Sep-2023; 2) US Unemployment Rate Sep-2023; 3) France Balance of Trade Aug-2023.
Domestic Update
The domestic smartphone market saw a decline of -6.3% YoY in 2Q23, marking a decrease for the eighth consecutive quarter. MNCS Comment: We observed this downturn since the end of FY19, coinciding with the chip crisis in the smartphone market. This has had a significant impact on entry-level smartphones. However, mid-high level smartphones remain relatively stable, with their market segment tending to be resilient against pricing factors. We expect a moderation of this decline in 2H23, especially as we approach the festive season in 4Q23.
Company News
1. ELSA IJ reported contract realization up to 8M23 amounting to IDR11.3 trillion (Emiten News). MNCS Comment: As a result, the contract achievement increased by +14.0% YoY (vs IDR9.1 trillion in 8M22). With the growing contract realization that boosts carry-over growth, it is expected to drive the company's performance forward. Currently, ELSA is traded at a level of 5.63x/0.67x PER/PBV.
2. JPFA IJ reported its inaugural export of 45k hatching eggs (HE) to Brunei Darussalam. The total export reached 130k HE (Kontan). MNCS Comment: We view the company's efforts to expand its export product range positively, which is expected to enhance branding and streamline the company's revenue. We believe that this export can help manage internal supply. Currently, JPFA is traded at a level of 1.29x PBV.
3. PANI IJ through its entity PT Panorama Eka Tunggal (PET), has acquired a plot of land in Tangerang district measuring 63,382 sqm, valued at IDR158.5 billion (Emiten News). MNCS Comment: We see the company's efforts to expand its land bank portfolio in a positive light, expected to strengthen the company's ecosystem moving forward. Moreover, the increase in project scale has the potential to drive the company's performance. PANI is currently traded at a level of 29.61x PBV.
IHSG Updates
The JCI declined by -0.17% to 6,874.83 on Thursday (05/10), accompanied by a net foreign sell of IDR672.6 billion. The majority of sectors weakened, weighing on the index, led by the property sector (-1.04%) followed by the energy sector (-1.03%). On the other hand, sectors experiencing growth were led by the healthcare sector (+2.34%), followed by the non-cyclical sector (+1.92%). The index declined despite the majority of Asian markets rebounding, as investors tend to adopt a wait-and-see approach ahead of the foreign exchange reserve data release in Sep-2023. The Rupiah closed higher at IDR15,615/USD. We estimate the IHSG will move within the price range of 6,860-6,812 pending the release of Foreign Exchange Reserves Sep-2023 data. Today's Recommendations: JSMR, PGEO, UNVR, WIIM.
Corporate Actions
IPO: IOTF (IDR100/share), KOCI (IDR120/share)
Cum Dividend: AALI (IDR82/share)
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