Global Market Highlight
DJIA weakened by -0.11% on Tuesday (31/08) followed by S&P 500 (-0.13%), and Nasdaq (-0.04%). The Wall Street closing was lower due to increasing awareness of the near-term risks to the economic recovery created by rising prices and the Covid-19 resurgence. While the US GDP growth estimates for 3Q21 are around 5% YoY. The economy grew at 6.6% YoY pace in 2Q21. On the other hand, manufacturing activity fell to 66.8 in August-21 (vs 73.4 July-21). Today the market will be looking forward to several data releases such as: 1) US Markit Manufacturing PMI Final; 2) Us ISM Manufacturing PMI; 3) Eurozone Markit Manufacturing PMI Final.
Domestic Update
• Indonesia Markit Manufacturing PMI reading was at 43.7 in August-21, or increasing by 3.6 points from the previous month at 40.1. MNCS Comment: The domestic manufacturing sector has shown an improvement despite still being in a contractionary mode. PPKM implementation has impacted the country's largest GDP contributor in the last two consecutive months. We expect with the gradual lifting of current state social restriction of course followed by epidemiologic indicators that are getting better would stimulate the manufacturing sector in the months coming ahead.
• Furthermore, there was an addition of 399 new Covid-19 cases in Jakarta yesterday.
Company News
1. TLKM IJ recorded IDR69.48 trillion revenue in 1H21 or rose by +3.92% YoY (vs IDR66.86 trillion in 1H20). COGS increased from IDR16.23 trillion in 1H20 to IDR17.47 trillion in 1H21. TLKM recorded IDR12.45 trillion net profit in 1H21 grew by +13.28% YoY (vs IDR10.99 trillion in 1H20) (CNBC Indonesia). MNCS Comment: We believe the increase in data services and Indihome will positively affect TLKM's top line. The accomplishment of net profit was above the MNCS estimate and consensus which implies 55% of the FY21E target. Currently TLKM is trading at 13.53x/3.42x PE/PBV.
2. ADRO IJ recorded USD1.56 billion revenue in 1H21, spike by +14.71% YoY (vs USD1.36 billion in 1H20). COGS increased from USD1.04 billion in 1H20 to USD1.06 billion in 1H21. ADRO recorded USD169.96 million net profit in 1H21 rose by +9.59% YoY (vs USD155.09 million in 1H20) (Emitennews). MNCS Comment: ADRO's performance reflected 45% of our estimate. We hope that the coal price uptrend will continue till the end of the year which support ADRO's top line. ADRO is currently trading at 8.18x/0.73x PE/PBV.
3. PTPP IJ recorded IDR6.46 trillion revenue in 1H21 or decreased by -4.30% YoY (vs IDR6.75 trillion in 1H20). COGS decreased from IDR6.04 trillion in 1H20 to IDR5.66 trillion in 1H21. PTPP recorded a net profit of IDR86.04 billion in 1H21 or a significant increase of +306.62% YoY (vs IDR21.16 billion in 1H20) (IQ Plus). MNCS Comment: Other income and divestment by the company caused net profit to grow, but the company's financial burden still increased in 1H21. Currently PTPP is trading at the level of 32.61x/0.52x PE/PBV.
IHSG Updates
JCI rose by +0.09% to 6,114.90 on Tuesday (31/08) followed by net foreign buy reaching IDR545.31 billion. JCI closed higher in almost all sectors, led by the tech sector (+1.67%) followed by the basic materials sector (+2.45%). On the other hand, the decline was led by the transportation & logistics sector (-1.09%), followed by the non-cyclical consumer sector (-0.63%). JCI strengthened due to relaxation of PPKM to level 3 in a number of regions. Subsequently, Indonesia's positivity rate fell to 11.09% in the past week. On the other hand, the Rupiah strengthened at IDR14,268/USD in the spot market. We estimate the JCI will move in the range of 6,080-6,180 while waiting for inflation rate data release. Today's recommendation: INKP, FREN, MLPL, MIKA.
Corporate Action
Cum Dividend Date: DLTA (IDR250/share)
IPO: HAIS (IDR300/share)
RUPS: JAYA
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