FROM EQUITY RESEARCH
Mayora Indah: Counting on Ramadhan sales boost (MYOR.IJ IDR 2.440 BUY.TP IDR 3.200) The Feb24 sales run rate grew by around 10% yoy, but not as briskly as MYOR had expected in Jan24. Higher cocoa and coffee prices threaten margins. We also lowered vol and ASP growth est. in FY24, resulting in tame earnings growth outlook. 1Q24 festivities may offer a positive catalyst for MYOR following YTD underperformance. Maintain Buy rating with a lower TP of Rp3,200. To see the full version of this report, please click here   Macro Strategy: Rising Volatility Risk Unlike other central banks, the BOJ is expected to hike rates, and this will have a moderate impact on yields and the currency volatility. The latest Beige Book indicates a slightly positive outlook on the US economy, and this suggests a more gradual rates cut path for the Fed. Despite lower Forex Reserves, BI reduced the OMO level whilst adding to SBN positions. This indicates a higher level of confidence in the IDR 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 Industrial Production Expanded by 7% in Jan-Feb24

China's industrial production expanded by 7.0% yoy in Jan-Feb24 combined, faster than a 6.8% growth in Dec23 and beating market forecasts of 5%. It was the fastest expansion in industrial output in almost two years, boosted by robust activities in manufacturing (7.7% vs 7.1% in December) and utilities (7.9% vs 7.3%), while mining continued to rise (2.3% vs 4.7%). On a monthly basis, the industrial output grew by 0.56%. In 2023, industrial output advanced by 4.6%. (Trading Economics)

 

Indonesia will Import 22,500 tons of Rice from Cambodia

The National Food Agency (NFA) said that Indonesia would import 22,500 tons of rice from Cambodia. This is one step to maintain stock other than domestic production. The Central Statistics Agency recorded that the volume of rice imports in the Jan-Feb24 period reached 880,820 tons. (Kontan)

 

SECTOR

Automotive: The First Electric Car Battery Factory in RI is Ready to Operate in April

According to the Ministry of Investment, PT Hyundai LG Indonesia (HLI) Green Power, based in Karawang, West Java, will start commercial production of electric vehicle batteries in April 2024. In the first phase, PT HLI will absorb an investment of US$1.1bn and have a production capacity of 10GWh, consisting of 32.6mn battery cells that could produce approximately 150,000 electric vehicles. In the second phase, PT HLI plans to increase production capacity to 20Gwh by 2025. (Kontan)

 

CORPORATE

BMRI Prepares Rp31.3tr in Cash for Ramadan and Eid

BMRI has prepared a net cash need of around Rp31.3tr (+10.5% yoy) to anticipate an increase in the need for cash in the community during Ramadan and Eid, from March 18, 2024, to April 16, 2024. Most of the cash is allocated to meet BMRI's ATM top-up needs, predicted to reach Rp1.7tr/day during the Ramadan and Eid periods. In anticipation of homecoming needs, Bank Mandiri has prepared up to 975,000 E-money cards, especially for toll road users. (Bisnis)

 

BRIS and BBCA Prepare Rp113.8tr in Cash for Eid 2024 Needs

BRIS and BBCA prepare a total of Rp113.8tr in cash to anticipate people's transaction needs, which often increase during Ramadan and Eid al-Fitr 2024. In detail, BRIS prepared Rp45tr in cash, a 20% increase from the realization of BRIS money turnover during the same period last year. On the other hand, BBCA projects that the need for cash that can be withdrawn from BCA ATMs and CRM will grow 7% yoy to Rp68.8tr. (Bisnis)

 

EXCL Completes Network Upgrades and Activates 5G In Central Java

EXCL has concluded a five-year initiative with Nokia to modernize approximately 4,400 of its existing sites in Central Java (Semarang, Yogyakarta, Surakarta, and Pekalongan) by replacing the existing network and adding new sites. EXCL, which has over 57mn subscribers, said it deployed Nokia's Airscale Dynamic Spectrum Sharing (DSS) and Network Performance Improvement (NPI) programs to update the network and increase capacity for future improvements. (Telecomtalk)

 

INTP & Market Cement Sales Feb-24

• Market 2M24 volume sales increased by 0.5% YoY, despite election impact in Feb-24. MoM sales was understandably weak (-13%) due to shorter working days in Feb vs Jan.
• Central Java booked +17% YoY growth for 2M24 period due to construction of 2 toll roads and Kendal industrial estate, and also due to inclusion of Grobogan to industry data. Kalimantan and Nusa Tenggara also showed positive YoY, as Kalimantan demand was boosted by IKN. This lead to higher bulk growth (12.2% YoY for 2M24) vs -7.6% for bag growth
• INTP market share was at 29.9% in Feb-24 (vs 29.8% in Jan-24). INTP booked 6.5% YoY cement growth for 2M24 period, driven by Grobogan inclusion into 2024 sales (affecting sales growth in Central Java and Yogyakarta). INTP market share increased by 10 bps MoM in Semarang and 40 bps MoM in Yogyakarta for Feb-24
• INTP also recorded positive YoY sales in Nusa Tenggara (16% YoY for 2M24 period) and Kalimantan (+6.3%) (Richard Jerry, CFA – BRIDS)

 

SMRA FY23 Result: Below Consensus Expectation

• SMRA booked net profits of Rp113bn in 4Q23 (-64% yoy, -49% qoq), bringing its FY23 net profits to Rp766bn (+23% yoy). The FY23 net profits are forming 135% of our FY23F estimates (currently under review), while compared to consensus net profits only achieved 90% of the forecast (i.e., Below). Core Net Profits in FY23 booked at Rp1.1tr, forming 113% to our last estimate.
• SMRA booked revenues of Rp1.6tr in 4Q23 (+5% yoy, -25% qoq), bringing FY23 revenue to Rp6.6tr (+16% yoy), with property development revenue grew 15% yoy to Rp4.0tr and investment properties revenue grew 19% yoy to Rp2.6tr during FY23.
• We will revisit our forecast to adjust FY23 achievement and FY24 Outlook. We currently have a BUY rating on SMRA with TP of Rp1,000 based on 69% discount to its RNAV of Rp3,170/share. (Ismail – BRIDS)

VinFast Offers Electric Vehicle Battery Rental in Indonesia

VinFast offers a subscription-based battery rental policy to address battery degradation concerns. By replacing batteries with a capacity below 70% and taking responsibility for all battery failures, VinFast claims to be able to maintain the optimal performance of its customers' electric vehicles, which could result in higher resale values in the future. (Kontan)

 

WSKT Completed PTBA's Property Project with a Contract Value of Rp151bn.

WSKT has completed the construction of a property owned by PTBA with a work package contract worth Rp151bn, with the scope of work including Structure, Architecture, Mechanical, Electrical and Plumbing. The company worked on this project in two stages: the first phase of the Office House and Town House, completed in 2021. Meanwhile, the second phase for Hotel Saka, Apartments and Club House was completed in 2022 but was only inaugurated this year. (Kontan)