FROM EQUITY RESEARCH DESK

IDEA OF THE DAY

Poultry: Bottoming-out Livebird Prices, Better Supply-Demand outlook in 2H25 (OVERWEIGHT)

• Chicken absorption from MBG program in FY25F to be minimal at 3.4%; full implementation may form 10% absorption in FY26 onwards.
• Slight underweight in local funds and rebounding LB prices from their bottom in mid-Apr25 should limit further downside risks.
• Maintain Overweight on poultry sector with CPIN as our top pick from cheaper historical valuation and better earnings outlook.

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RESEARCH COMMENTARY

EXCL (Buy, TP: Rp2,800) – Meeting KTA

• Mgmt acknowledged that the ARPU decline in 1Q25 was due to industry competition as new starter packs are at 70-80% discount to regular packages. Nonetheless, EXCL believes that 1Q25 ARPU should mark the bottom, with data yield expected to improve as the standardized 35k starter packs are implemented.
• Despite ex-Java being more price-sensitive, ARPU in ex-Java is higher than in Java. EXCL plans to optimize network coverage by decommissioning or redeploying 15-20% of overlapping towers and expanding presence over the next two years.
• Mgmt’s current focus is on integrating the networks of XL and Smartfren, with plans to expedite the process in under 2 years, including preparations for 5G deployment in various cities. Discussions are still ongoing regarding the ownership of Linknet and Moratel.
• Capex has been reduced in recent quarters due to the pending merger, but is expected to accelerate in the coming quarters, driven by network integration and consolidation.
• The integration process will not impact how EXCL sees the spectrum auction, and the company indicated interest in participating in the 700MHz and 2600MHz spectrum auctions.
• EXCL sees firm demand for fixed broadband (FBB) and does not see the need to significantly lower prices. It sees FBB as more costly than mobile, and the company remains cautious about profitability.
• EXCL aims to simplify its product offerings and prioritize digitalization, making it easier for customers to discover products, while reducing inefficiencies and markups from traditional retail channels.
• The key KPIs post-merger are higher margins, and higher growth, with annual pre-tax cost savings of US$300–400mn, including an estimated US$100mn to be realized in FY25. Still, there is no specific guidance on revenue growth at this time. (Erindra Krisnawan & Kafi Ananta – BRIDS)

 

MARKET NEWS

MACROECONOMY

Fed Reviews 2020 Policy Framework to Address Economic Shifts Fed Chair Powell said the Fed is reviewing its 2020 policy framework to better reflect today’s economic realities, including persistent supply shocks and evolving labor dynamics, while ensuring the 2% inflation target remains credible. (Bloomberg)

 

SECTOR

Commodity Price Daily Update May 15, 2025

CORPORATE

BBCA Concludes Rp1tr Share Buyback

BBCA has accelerated the completion of its Rp1tr share buyback program, which was originally scheduled to end on June 24, 2025, but was concluded early on May 15, 2025. According to the company, the decision was driven by improving market conditions and the stabilization of the company’s share price. (Kontan)

 

Grab Indonesia Denies Merger Rumors with Gojek

Grab Indonesia has firmly denied rumors of a potential merger with rival ride-hailing company Gojek. In an official statement, Chief of Public Affairs Tirza Munusamy clarified that the speculation is unverified and therefore not subject to further comment. Grab also emphasized that its operations as a Foreign Investment Company (PMA) in Indonesia are predominantly managed by local talent. (Emiten News)

 

Hyundai Kona Electric Achieves 80% Local Content in Indonesia

Hyundai has begun producing the Kona Electric in Indonesia with 80% local content, supported by an integrated EV ecosystem involving PT Hyundai LG Indonesia (HLI) Green Power, PT Hyundai Energy Indonesia (HEI), and PT Hyundai Motor Manufacturing Indonesia (HMMI). The high local content is due to the use of locally assembled battery cells, with each Kona EV requiring 216 cells. The Long Range variant offers a range of up to 602 km with a 66 kWh battery, while the Standard Range variant can travel up to 448 km with a 48.9 kWh battery. (Bisnis)

 

INET Targets Rp474bn Revenue from Subsea Cable Business

INET projects an additional revenue of Rp474bn following a new subsea cable lease contract. The company estimates Rp300bn from IP Transit services, Rp120bn from content exchange, and Rp54bn from IPLC services. (Kontan)

 

MYOR Plans Rp1tr Share Buyback

MYOR will seek shareholder approval for a share buyback worth up to Rp1tr at an EGMS on June 4, aiming to stabilize its share price and boost shareholder value. The buyback, capped at 20% of paid-up capital, will run from June 5, 2025, to June 5, 2026, funded by internal cash without affecting operations. (Emiten News)

 

PANI Distributes Dividend of Rp4/share

PANI has declared a dividend of Rp4/share (yield: 0.03%), totaling Rp67.5bn, from its comprehensive income for the 2024 fiscal year, which reached Rp625.99bn. In line with this dividend policy, PANI shareholders have also approved the allocation of Rp557bn to retained earnings and Rp1bn to reserve funds. (Bisnis)

 

Starbucks Reviews China Business Amid Competition

Starbucks is exploring options for its China business, including a possible stake sale, seeking feedback from potential investors. Despite operating over 7,750 stores and earning US$740mn in net profit in China in 1Q25, the company faces pressure from macroeconomic challenges and rising competition from local players like Luckin Coffee. (Bisnis)