FROM EQUITY RESEARCH DESK

IDEA OF THE DAY

Banks: Potential Higher CoC and Earnings Risks on SOE Banks from Govt’s Kopdes Merah Putih Initiative (NEUTRAL)

• While unlikely a game changer, the potential involvement of SOE banks in the Kopdes Merah Putih initiative could add earnings downside risks.
• The worst-case scenario may see SOE banks’ CoC rise by 49-82bps in addition to higher liquidity risk.
• Maintain Neutral rating on the sector with BBCA as our top pick, followed by BTPS and BRIS given their better liquidity and NPL outlooks. 

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Mayora Indah: Expect A Double-digit FY25F Core Profit Growth Despite 1Q25 Margin Challenges; Reiterate Buy (MYOR.IJ Rp 2,310; BUY TP Rp 3,050)

• MYOR is optimistic about booking double-digit FY25 rev. growth and net profit yoy, supported by volume growth and lower input costs.
• We raised our FY25-26F est. by 3.8%-2.3%, driven by higher FY25F ASP growth amid optimized A&P spending, leading to stronger OPM.
• Amid higher gross margin base in 1Q24, we believe investors should look for growth beyond 1Q25; reiterate Buy rating with TP of Rp3,050.

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RESEARCH COMMENTARY

LPPF (Not Rated) - FY24 Result: Above Consensus

• LPPF recorded 4Q24 gross sales of Rp2.8tr, declining 3.7% yoy, bringing FY24 gross sales to Rp12.3tr/-2.0% yoy. Net profit was improved by 22.5% in FY24 to Rp828bn (119% to consensus, i.e, above) supported by a higher net margin of 6.7% (vs FY23: 5.3%).
• SSSG declined 1.7% in FY24, with regular stores down 1.3% and watchlist stores down 5.5%. Regionally, Greater Jakarta saw the steepest decline at 6.3%, followed by Java ex-Jakarta (-0.6%) and Outside Java (-0.2%). LPPF continues to develop its private label (SUKO and ZES) while exploring new categories and brands.
• LPPF proposes a dividend of Rp300 per share (82% payout of FY24 EPS), subject to AGM approval, which translates to a 17.4% yield. (Natalia Sutanto & Sabela Nur Amalina – BRIDS)

MEMR’s proposed increase in royalty rates

• Nickel ore from 10% to 14%
• Nickel matte from 2% to 4.5%
• FeNi from 2% to 5%
• NPI remains at 5%
• We have previously made calculation on the impact of ore royalty hike, which impacted ANTM’s earnings the most at -9% and MBMA by -8%: https://link.brights.id/brids/storage/37667/20250219-Metal-Mining.pdf (Timothy Wijaya - BRIDS)

   

Poultry (Overweight) – 1st week of March 2025 Price Update

• Live bird prices have currently declined to Rp19.6k/kg, bringing the weekly average price to Rp20.3k/kg in the first week of Mar25, down 4.4% wow. Meanwhile, when comparing the first week of Ramadan with the 30 days leading up to Ramadan, live bird prices have increased by 4%, from Rp19.6k/kg.
• Day-old chick (DOC) prices decreased to Rp4.7k/chick, down 14% wow.
• Local corn prices remained stable at Rp5.2k/kg, with the weekly average price remaining unchanged since mid-Jan25 at Rp5.2k/kg.
• Soybean meal (SBM) prices held steady below US$300/t in the first week of Mar25, bringing the Mar25 average price at US$292 (-2% mom, -13% yoy).
• The price trend of live birds and DOC in the first week of March 2025 was weaker compared to the previous week. However, overall cost prices remained steady. Despite this, we still expect solid results for 1Q25. (Victor Stefano & Wilastita Sofi – BRIDS)

ROTI (Not Rated) - FY24 Result: Above Consensus

• ROTI reported 4Q24 revenue of Rp957bn/-2.6% yoy. However, FY24 revenue grew 2.9% yoy to Rp3.9tr, achieving 97% of consensus estimates, (i.e., inline). This growth was fully driven by volume growth for affordable bread and cake products.
• Net profit improved by +10.1% yoy/+9.3% qoq in 4Q24, leading to an 8.8% yoy increase to Rp362bn in FY24. However, the return rate has not yet improved, remaining at 16.3% (FY23: 16%). This result exceeded the consensus estimates at 106%. Net margin also showed improvement, rising to +11.9% in 4Q24 and +9.2% in FY24, compared to +10.5% in 4Q23 and +8.7% in FY23.
• In terms of sales channel, MT sales grew by 3.0%, continuing to outperform as consumers increased their visit frequencies to outlets. Meanwhile, GT sales increased by 2.6% yoy in FY24. The mgmt. expects GT sales to further contribute to overall growth, supported by an expanding number of points of sale, improved outlet productivity, and growth in the B2B category.
• By region, Outer Java sales grew by 8.6% yoy, while sales from the East and West Regions contributed 47.7% to total revenue, up from 45.2% in FY23. ROTI anticipates stronger market penetration in Sumatra, driven by the commercial operation of Plant #15 in Pekanbaru in late 2024. (Natalia Sutanto & Sabela Nur Amalina – BRIDS)

MARKET NEWS

MACROECONOMY

China CPI Dropped 0.7% yoy in Feb25

China CPI dropped 0.7% yoy in Feb25, reversing January's 0.5% rise and marking the first decline since Jan24. Core CPI, which excludes food and fuel prices, decreased 0.1% yoy, the first decline since Jan21. NBS statistician Dong Lijuan stated on Sunday that last February’s high base contributed to the decline: "Excluding the impact of different Lunar New Year months, CPI increased by 0.1% yoy in February." (Reuters)

 

US NFP Rose by 151k in Feb25

US NFP rose by 151,000 in Feb25 after a downward revision to the previous month. The unemployment rate edged up to 4.1%, fueling concerns about an economic slowdown. However, Fed Chair Jerome Powell stated that the central bank will not rush to cut interest rates and expressed concerns over President Donald Trump's policies. He emphasized a cautious approach to monetary policy easing, noting that the economy "continues to be in a good place." (Reuters)

 

SECTOR

Commodity Price Daily Update Mar 7, 2025

Automotive: Motorcycle Sales Reach 1.14mn Units in 2M25

The Indonesian Motorcycle Industry Association (AISI) reported domestic sales of 1.14mn units in the first two months of 2025. February sales reached 581,277 units, up 4.04% yoy and 3.74% mom. AHM targets 6.5mn units this year, slightly below AISI’s 6.7mn projection. While segment data is no longer disclosed, scooters previously dominated sales. (Kompas)

 

CORPORATE

ADRO’s Subsidiary Acquires KIPI

PT Alam Tri Bangun Indonesia, a subsidiary of ADRO, has announced its plan to acquire PT Kalimantan Industrial Park Indonesia (KIPI). The acquisition will be carried out through the issuance of new shares by KIPI, which will then be subscribed by ADRO through a debt-to-equity conversion. (Kontan)

 

BELI Launches MESOP Program

Global Digital Niaga (BELI) plans to implement Phase II & Phase IV of its Management and Employee Stock Option Program (MESOP), along with Phase III & Phase II of another MESOP initiative. The total stock options granted under these programs amount to 1.46mn shares and 3bn shares, respectively. The program will run for 30 trading days, from March 15, 2025, to April 14, 2025, with an exercise price of Rp406/share. (Kontan)

 

BSDE Sets Pre-Sales Target at Rp10tr in 2025

BSDE targets Rp10tr in marketing sales for 2025, with 51% from residential sales, 34% from commercial, and 15% from JV land plot sales. Key projects like BSD City and its JV project, along with developments in Grand Wisata and Kota Wisata, are expected to drive growth, supported by the VAT incentive policy and infrastructure improvements in Jakarta. The 2024 acquisition of SMDM is expected to contribute 3%, and joint venture land sales will add Rp1.5tr or around 15% to the target. (Company)

 

Chery to Open 40 New Dealers by 2026

PT Chery Sales Indonesia (CSI) will add 40 dealers, totaling 80 nationwide, to boost competitiveness. Sixteen will be in Jabodetabek, featuring the premium "Leopard" concept. This initiative is part of Chery International’s US$1bn (Rp14.9tr) investment commitment, with 20 new dealer partners signing a strategic agreement. (Investor Daily)

 

ERAA Boosts Expansion and Ramadan Sales

ERAA is expanding its retail network and product offerings while leveraging Ramadan and Eid to drive sales. Despite economic challenges, ERAA remains aggressive, adding new stores in strategic locations and strengthening its distribution network, including Eraspace. With 77 distribution centers and 1,864 retail stores, the company focuses on improving efficiency and customer experience while expanding beyond Java. (Bisnis)

 

Freeport's Export License to Be Evaluated Every Three Months

The Ministry of Energy and Mineral Resources (MEMR) has confirmed that it will conduct a quarterly evaluation of the progress in the development of the PT Freeport Indonesia (PTFI) smelter, following the issuance of a six-month copper concentrate export permit. According to ESDM, this evaluation will ensure the progress of repairs at the Manyar smelter, which was previously damaged by a fire. Furthermore, the MEMR stated that the volume of copper concentrate allowed to be exported by PTFI is approximately 1mn tons. (Kontan)

 

GOTO Buybacks 2.07Bn Shares in February 2025

GOTO continued its share buyback program in Feb25, repurchasing 2.07bn shares at a cost of Rp145.2bn to Rp173.51bn. To date, GOTO has bought back a total of 23.18bn shares, spending an estimated Rp1.3tr to Rp1.4tr. The company previously announced a buyback plan with a total budget of US$200mn (approximately Rp3.1tr). (Bisnis)

 

ISAT and Cisco Partner with Komdigi to Develop Indonesia’s Cybersecurity Talent Ecosystem

ISAT and Cisco are collaborating with Komdigi to build a globally competitive cybersecurity talent ecosystem.  Through the IDCamp program, Indosat integrates Cisco's advanced cybersecurity learning modules, providing Indonesian youth with access to global certifications in this field. This strategic partnership aims to develop 1 million certified cybersecurity professionals. This initiative serves as a strategic step in strengthening national cybersecurity resilience amid an increasingly complex and dynamic threat landscape. (Investor Daily)