FROM EQUITY RESEARCH
Indo Tambangraya: FY24 outlook: Higher volumes growth to partly cushion against potential ASP correction (ITMG.IJ IDR 22.175 BUY.TP IDR 28.800) ·         ITMG indicated more aggressive FY24 production and sales growth plans (+15-20% yoy), driven by the contribution from its newer mines. ·         We raise our FY24F net profit estimate by 31%, as we adjust our sales volume assumptions, in-line with the mgmt’s latest guidance. ·         Maintain Buy with a slightly higher TP of Rp28,800 on ITMG’s sustainable FCF generation and solid dividends (current yield of 23.4%). 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

China: Expectation for some Macroeconomic Variable in 2024

China convened its National People's Congress yesterday, during which Premier Li Qiang delivered his inaugural work report on the country's economy. Here are the expectations for some macroeconomic variables in 2024 (vs. 2023):

• GDP: 5% (vs. 5.2%)
• CPI: 3% (vs. -0.3%)
• Budget Deficit: 3% (vs. 3.8%) (Bloomberg)

CORPORATE

ANTM Targets Optimization of Production Performance and Company Core Commodities

ANTM targets ferronickel production and sales volumes of 22,464 tons of nickel in ferronickel (TNi) each. For nickel ore commodities, ANTM targets total consolidated production used as raw material for ferronickel factories and sales to domestic customers of 20.58mn wmt. Meanwhile, nickel ore sales in 2024 are targeted to reach 18.75mn wmt. Regarding gold commodities, the company targets gold production from the ANTM gold mine of 958 kg (30,800 troy oz). Meanwhile, gold sales in 2024 are targeted to reach 37,354 kg (1,200,959 troy oz). (Kontan)

 

BBRI Qlola Cash Management Transaction Volume Reaches Rp6,788tr

BBRI Qlola cash management transaction volume reaches Rp6,788tr (+33.9% yoy). The increase occurred in wholesale and non-wholesale segments as Qlola gained more than 4,800 new clients. The Company continues to strive to improve Qlola's features and capabilities. At the end of 2023, the Global Cash Management System feature was added to QLola, which can be used by BRI overseas branch customers, including BRI Singapore and BRI Timor Leste. (Emiten News)

 

BELI will Carry Out MESOP worth Rp1.11tr

BELI will hold a Management and Employee Stock Option Program aka MESOP II phase II with a total value of Rp1.11tr. The MESOP II phase II program will release a maximum of 2.589mn shares at a price of Rp430/share. The implementation period for this program is 30 calendar days starting from March 15, 2024. (Investor Daily)

 

EXCL’s Three AI Projects in 2024

EXCL is working on 3 AI projects this year. According to EXCL, currently, there are three use cases for AI used by EXCL. First, the company operates the network using AI. Secondly, to provide better contact service or CS using AI. Third, AI can be used to provide services that are more appropriate to customer needs. The company has implemented AI in network operations to have zero-touch operations, meaning as little human intervention as possible in operating the network. Additionally, there are cost savings from using AI, reaching up to 40%-50% of EXCL's financial burden.

 

FREN and EXCL Merger to Happen as Soon as Possible

FREN hopes that the merger with EXCL will happen as soon as possible, as the company views it as one of the best solutions for efficiency through equipment, human resources, and capital. Furthermore, with the merger, the spectrum will be more comprehensive, which means customers will get better network quality. (Bisnis)

 

ISAT-NVIDIA Collaboration to be Launched in 3Q24

ISAT and NVIDIA collaboration on the use of AI could be launched in 3Q24. ISAT will use its ecosystem, Lintasarta, BDx, and collaboration with NVIDIA to ensure Indonesia becomes an AI-ready country. According to ISAT, there will be many use cases or uses of AI that Indosat will present to Indonesia in 3Q24 and the coming quarters. (Bisnis)

 

PTBA headline 4Q23/ FY23: earnings beat from strong 4Q23

• FY23 net profit: US$6.1bn (-51% yoy, 18%/ 13% above ours/ cons.)
• FY23 EBITDA: US$8.1bn (-49% yoy, 23%/ 9% above ours/ cons.)
• 4Q23 net profit: US$2.3bn (+132% qoq/ -9% yoy), supported by 21% qoq revenue (-7% yoy).

 

PTBA Inaugurated PLTS with 57.5 kWp Power Capacity in South Sumatra

PTBA inaugurated a Solar Power Plant (PLTS) with a capacity of 57.5 kWp in Muara Lawai Village, Muara Enim, South Sumatra. This is the 7th PLTS built by PTBA for farmers in operational areas around the company. The Muara Lawai PLTS can irrigate 119ha of rice fields. The PLTS can also accommodate the water needs for farming as many as 268 farmers. The irrigation process starts with two 22 KW water pump machines, then distributed through a 1.2 km long pipe with a flow rate of 241 m3/hour. (Kontan)

 

TBIG and BDIA Signed the Provision of Management Service Agreement

TBIG and Bersama Digital Infrastructure Asia Pte Ltd (BDIA) already signed the service agreement on March 1, 2024. Under the Service Agreement, the transaction object is the provision of management service by BDIA to the TBIG Group. TBIG’s payment obligation to BDIA for service fees in the transaction will not exceed US$60mn. (Company)

 

UNTR: neutral impact from additional stake acquisition in Supreme Rantau Dedap geothermal

• UNTR acquired an additional 20.2% stake in Supreme Rantau Dedap geothermal plant (in Muara Enim, South Sumatra) from Merit (Marubeni-Tohoku) and Inpex for US$80.7mn. This followed the first acquisition of 12.5% stake (valuation at US$51.9mn) from Supreme Energy Sriwijaya in 3Q23.
• Thus, UNTR now controls an effective ownership of 32.7% in the geothermal plan – Merit still has the largest control at 34%, and Inpex with 33.3%.
• Rantau Dedap geothermal plant currently has 2x49MW of capacity, with 30yrs PPA (since 2021). Under the PPA, the total capacity is 2x110MW and hence, there will be capex for development of the next capacity phase.

 

Our view: The latest acquisition translates to valuation of US$433mn (slightly higher than the first acquisition of US$415mn) for 100% of the asset. In turn, this translates to US$4mn/ MW, falling in-line with geothermal brownfield capex of US$3mn and greenfield capex of US$7-8mn (based on Hasan’s estimation).  Thus, we see neutral impact on UNTR’s valuation. (Erindra Krisnawan – BRIDS)