Global Market Highlights
The DJIA declined by -1.14% on Tuesday (26/09), followed by the S&P500 (-1.47%) and the Nasdaq (-1.57%). Wall Street contracted again, amidst disappointing macroeconomic data. New home sales in Aug-2023 decreased by -8.7% MoM. Additionally, CB consumer confidence in Sep-2023 dropped to 103 (vs 105.5 consensus). Today, the market will be looking toward several data releases such as: 1) US Durable Goods Orders MoM Aug-2023; 2) Germany GfK Consumer Confidence Oct-2023; 3) France Consumer Confidence Sep-2023.
Domestic Update
• The government, in agreement with DPR, has finalized the 2024 state budget with a revenue target of IDR2,802.3 trillion and an expenditure target of IDR3,325.1 trillion. MNCS Comment: The revenue target has increased from the 2023 budget, which was IDR2,463.0 trillion. With these targets, the budget deficit is agreed upon at 2.29% of GDP, lower than the 2023 budget deficit target of 2.84%.
Company News
1. MBMA IJ has signed a definitive agreement with GEM Co. Ltd., to build a High-Pressure Acid Leach (HPAL) processing plant with a capacity of 30 thousand tons in MHP annually (Emiten News). MNCS Comment: We view this strategic partnership positively, as it can enhance the company's performance going forward. We believe that the HPAL technology offers advantages in energy use and minimal environmental impact. Currently, MBMA is traded at a level of 1.34x/18.10x PER/PBV.
2. HEXA IJ aims to sell excavators weighing >6 tons, targeting 2,375 units in FY23E (Market Bisnis). MNCS Comment: This figure is lower than the sales realization in FY22, which was 3,447 units, and FY21, which was 2,676 units. Meanwhile, the sales realization of heavy equipment up to 1H23 reached 607 units, or 25.6% of the FY23E target. Currently, HEXA is traded at a level of 6.55x/2.07x PER/PBV.
3. DSNG IJ has realized the first Bio-CNG plant in Indonesia, aiming to replace fossil fuels used in electric generators and vehicles (Kontan). MNCS Comment: We view the company's effort positively, as it can create efficiency value and positively impact future profitability. In FY22, the implementation of Bio-CNG saved 3.7 million liters of diesel consumption. Currently, DSNG is traded at a level of 8.87x/0.79x PER/PBV.
IHSG Updates
The JCI declined by -1.07% to 6,923.80 on Tuesday (26/09), followed by a net foreign sell of IDR658.75 billion. Most sectors experienced a decline, weighing on the index performance, led by the basic materials sector (-2.83%) followed by the energy sector (-2.79%). On the other hand, sectors that strengthened were led by the non-cyclical sector (+0.60%), followed by the technology sector (+0.32%). The index's decline aligned with Asian exchanges, triggered by the rise in global yields amid exposure from signals of higher for longer interest rates, pushing capital outflow. The Rupiah closed lower at IDR15,490/USD. We estimate the IHSG will move within the price range of 6,900-6,945. Today's Recommendations: ADRO, ANTM, MAPI, NCKL.
Corporate Actions
Cum Dividend: PLIN (IDR77/share)
Disclaimer On
