Global Market Highlight
DJIA rose by +0.11% on Wednesday (25/08) followed by S&P 500 (+0.22%), and Nasdaq (+0.15%). Wall Street ended higher as investors became more optimistic a day after the House of Representatives passed the USD3.5 trillion budget framework and a top health official expressed confidence that Covid-19 could be under control by early next year. Today the market will be looking forward to several data releases such as: 1) US GDP Growth Rate QoQ 2nd Est; 2) Germany GfK Consumer Confidence; 3) UK ECB Monetary Policy Meeting Accounts.
Domestic Update
• Broad money supply (M2) grew by 8.9% YoY to IDR7,149tn in July-21 according to Bank Indonesia (BI) with M1 increased 14.9% YoY and quasi money rose 6.8% YoY. MNCS Comment: M2 growth was decelerating as it expanded 11.4% YoY in June-21. Factors affecting M2 in July-21 were increasing Net Foreign Asset (+4.3% YoY) and limited loan disbursement (+0.3% YoY) amid the implementation of PPKM Darurat and later on renamed as PPKM Level 4. Although liquidity in the economy remained ample, we expect the inflationary impact would still be minimal as money velocity dropped during the period of social restriction.
• Furthermore, there was an addition of 789 new Covid-19 cases in Jakarta yesterday.
Company News
1. INDF IJ recorded IDR47.29 trillion revenue in 1H21 rose by +20.08% YoY (vs IDR39.38 trillion in 1H20). COGS increased from IDR26.91 trillion in 1H20 to IDR31.39 trillion in 1H21. INDF recorded IDR3.43 trillion net profit in 1H21 grew by +20.77% YoY to (vs IDR2.84 trillion in 1H20) (CNBC Indonesia). MNCS Comment: INDF’s net profit accomplishment in line with our forecast and consensus which implies 51% of the FY21E target. We estimate that the strong brand position in the CBP segment as well as the improvement in the agribusiness segment will continue to support a much better performance throughout the year. Currently INDF is trading at 8.09x/1.21x PE/PBV.
2. ULTJ IJ will distribute FY20 cash dividends of IDR85/share or IDR883.84 billion from FY20 net profit of IDR1.10 trillion. Cum Date 31 August 2021 (IQ Plus). MNCS Comment: ULTJ's dividend distribution ratio is 80.42% of the total FY20 net profit, while the total dividend yield offered is 5.50%. ULTJ is currently trading at 13.52x/3.34x PE/PBV.
3. MDKA IJ posted revenue to USD135.42 million in 1H21 or decreased by -31.88% YoY (vs USD198.81 million in 1H20). COGS decreased from USD122.44 million in 1H20 to USD107 billion in 1H21. MDKA recorded a net profit of USD5.87 million in 1H21 or decreased by -84.66% YoY (vs. USD38.27 million in 1H20) (IQ Plus). MNCS Comment: MDKA's weak performance was still a result of the heap leach mine incident which cause lower production. However, MDKA still managed to score a net profit from a net loss in the previous quarter, therefore we are hopeful of MDKA's improving performance for the rest of the year. Currently MDKA is trading at the level of 365.21x/5.88x PE/PBV.
IHSG Updates
JCI strengthened by +0.39% to 6,113.24 on Wednesday (25/08) followed by net foreign buy reaching IDR788.95 billion. JCI closed higher in almost all sectors, led by the health sector (+1.40%) followed by the industrial sector (+1.13%). On the other hand, the transportation and logistics sector declined by -0.18%, followed by the cyclical consumer sector (-0.17%). The strengthening of the JCI was driven by market optimism that the world's economic recovery would accelerate after the United States Food and Drug Administration (FDA) give full permission for Pfizer-BioNTech's Covid-19 vaccine. Meanwhile, the Rupiah weakened by -0.03% towards the level of IDR14,398 on the spot market. We estimate the JCI will move in the range of 6,050-6,120. Today's recommendation: ACES, AGII, BBNI, WSBP.
Corporate Action
Public Expose: ADES, BEEF, GAMA
Disclaimer On
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