FROM EQUITY RESEARCH
Macro Strategy: A Mixed Bag ·         Fiscal Front Loading will support the consumption growth outlook in 1Q24, with large spending in the final weeks of 2023 as well. ·         Déjà vu in respect to last year’s regional banking crisis, with commercial real estate the core problem. Spillover risk remains on the upside. ·         The latest Treasury Quarterly Refunding announcement paves the way for a lower yields outlook with lesser Risk Premia. To see the full version of this report, please click here   Bank Mandiri: Raising our FY24-25F forecast and TP post 4Q23 earnings beat  (BMRI.IJ IDR 6.675 BUY.TP IDR 7.600) ·         BMRI reported FY23 net profit of Rp55.1tr (+34%yoy) beating our forecast and the cons. on 4Q23 higher recoveries and lower provisions. ·         We expect the FY24F earnings growth to normalize due to our expectation of softer NIM and CoC normalization. ·         Maintain BUY with a higher TP of Rp7,600 as we raise our FY24F net profit estimate by 5%, resulting in a higher ROE of 21.2%. To see the full version of this report, please click here   To see the full version of this snapshot, please click here   MARKET NEWS

MACROECONOMY

US Non-Farm Payroll and Unemployment Rate

US added 353k jobs in January 2024, higher than the upwardly revised December’s 333k. The unemployment rate was unchanged at 3.7% while Average Hourly Earnings accelerated to 4.5% y-y from 4.4% in December. (Bloomberg)

 

SECTOR

Cigarette: Government Relaxes Payment of Excise Tapes for 90 Days

The government has again relaxed the payment of excise stamps for 90 days (three months) from the normal (two months). This policy will take effect from January 18, 2024. This relaxation aims to maintain and secure state revenues in the excise sector and provide leeway in the Company's cash flow. (Kontan)

 

CORPORATE

BIRD aims for double-digit revenue increase in 2024

BIRD is optimistic about targeting double-digit revenue growth in 2024. BIRDS managed to score a significant increase in business until the third quarter of 2023. BIRD recorded revenue and net profit growth of 28.7% yoy and 40.97% yoy, respectively. Furthermore, BIRD is preparing a CAPEX allocation of around Rp2-2.5tr in 2024. The Company will purchase and refurbish a total of 7,000 taxis, non-taxi, and EV fleets to meet the demand for standardized mobility. (Kontan)

 

BRIS Prepares Rp1.5tr for IT Spending

BRIS has budgeted a capex of Rp1.5tr for Information Technology (IT), including developing the Super App and strengthening cybersecurity. For information, BRIS allocated Rp350bn and Rp1.32tr for IT spending in 2022 and 2023, respectively. Currently, BRIS’s mobile users reach 6.3mn people whereas the opening of online onboarding (OOB) accounts reaches 86%. (Bisnis)

 

MDKA Issues Rp1.5tr Bonds

MDKA will issue bonds of Rp1.5tr. The issuance of the bonds is part of Merdeka Copper Gold's Shelf Registration Bond IV Phase V in 2024, which has a maximum value of Rp15tr. All proceeds from the bond offering will be used to refinance maturing bonds. First, Rp1.34tr to fund part of the obligations in the plan to repay the entire principal of the Merdeka Copper Gold IV Sustainable Bonds Phase II Year 2023, and the rest will be used to fund part of the obligations in the plan to repay the entire principal of the Merdeka Copper Gold II Sustainable Bonds Phase I Year 2021 Series B. (Emiten News)

 

PGAS Received Low Priced Gas Allocation of US$5.5 MMBtu from Duyung Block

PGAS Received a 29.5% allocation of the total gas sales volume of Duyung Block, Mako Field, from Conrad Asia Energy Ltd. The domestic market obligation (DMO) allocation mandates Conrad to sell gas to PGAS at US$5.5 MMBtu. Through the revised PoD, the contingent gas resources from the Mako field increased by 458% to 297bn cubic feet following the successful appraisal drilling the previous year. (Bisnis)

 

TINS Provides Loan to Subsidiary Rp36.5bn, Interest 8%

TINS provided a short-term loan to PT DOK and Air Kantung Shipbuilding. TINS provided a short-term loan of Rp36.5bn to its subsidiary, with a term of 45 working days and an interest rate of 8% p.a. This loan has no impact on the operational activities, legal, financial condition, or business continuity of TINS and is not a material transaction. (Emiten News)

 

TLKM to Convey Rp42tr of Fibre Assets to Infraco

TLKM will invest all assets in the company's connectivity business into Infraco with a total value of Rp36-42tr. This is in line with TLKM's plan to spin off all of the company's fibre-optic-based connectivity network business to a subsidiary. As an initial stage, TLKM focuses on managing services. Therefore, this year Telkom is trying to keep the fibre business running without transferring assets first. Another consideration is the licensing factor as long as the license takes time because it needs to pass the feasibility test and others. (Investor Daily)

 

Volta Group and BIRD establish cooperation with BRI Finance

BRI Finance established a strategic partnership with BIRDS and Volta Group. This cooperation involves financing facilities for Volta electric motorbikes for Bluebird drivers. The collaboration presents a program for Bluebird drivers and employees to have the opportunity to buy Volta electric motorbikes priced at Rp9.95mn with light installments of up to 24 months from BRI Finance. Thus, saving the initial cost of ownership and reducing excessive financial burden. (Investor Daily)