FROM EQUITY RESEARCH DESK

IDEA OF THE DAY

Aspirasi Hidup Indonesia: Strong Aug24 SSSG; YTD Monthly Sales Surpass Pre-Pandemic Levels, in line with our FY24F (ACES.IJ Rp 880; BUY TP Rp 1,100) ACES reported strong SSSG of 11% yoy in Aug24 and 9.9% for 8M24, exceeding mgmt’s/our FY24 target of at least 7%/7.6%. Aug24-YTD average monthly sales grew 14% yoy, exceeding pre-pandemic levels of Rp671bn/month. We estimate 3Q24E/9M24E net profit growth of 13%/18% yoy to form 66/68% of FY24F/Cons. Maintain Buy rating with unchanged TP. To see the full version of this report, please click here   To see the full version of this snapshoot, please click here   MARKET NEWS

RESEARCH COMMENTARY

BBTN Aug24 Bank Only Results

8M24 Insight:

• Net profit down 10% yoy: BBTN posted a net profit of Rp1.8tr in 8M24, achieving 53% of the consensus forecast, below 57% in 8M23 achievement. Cumulative NP decreased by 10% yoy, up from -6% yoy in 7M24.
• NII remained low: NIM remained at 2.9% (-76bps yoy) caused by 54bps increase in CoF and 24bps decrease in EA yield due to several occurrences of accrued interest correction.
• CIR still high: Opex still grew mom in Aug24, keeping the 8M24 opex high at Rp6.8tr (+18% yoy), with CIR at 65.5% (up from 53.3% in 8M23).
• Low provision exp.: Implied asset quality remained robust, with a low CoC at 0.6% (vs 1.3% in 8M23).

 

Aug24 Insight:

• Net profit rebound from low base: In Aug24, BBTN booked NP of Rp203bn (-32% yoy), doubled the Jul24 low base due to NIM recovery.
• NIM recovery: NIM recovered to 7.5% from its low base of 6.7% on Jul24, but still down from 8.1% in Aug23. EA yield returned to 7.5% in Aug24 (8M24 at 7.4%) but CoF remained high at 4.9% (flat mom, +44bps yoy).
• Opex still increased: Opex rose 10% mom driven by 29% mom increase in salaries expenses. CIR was down mom to 67.0% mainly due to the higher NII (NIM recovery).
• CASA down, LDR flat: The bank’s CASA ratio dropped to 48.4% in Aug24. LDR remained flat mom at 95%. Both loans and deposits were flattish mom.

 

Summary:

• Overall Performance: Aug24 results improved from the low base in Jul24, but remained weak as the low CoC could not offset the low NIM and high opex. (Victor Stefano & Naura Reyhan Muchlis – BRIDS)

BBNI Aug24 Bank Only Results

8M24 Insight:

• Net Profit: BBNI posted a net profit of Rp14.2tr in 8M24 (+4% yoy), driven by lower provisions (-27% yoy), which offset the decline in PPOP (-5% yoy).
• Performance vs. Consensus: The 8M24 net profit represents 65% of the FY24 consensus forecast, in line with our and the consensus FY24 estimates.
• Loan and Deposit Growth: Loans decreased by 1% mom, reducing yoy growth from +11% in Jul24 to +9% in Aug24.
• NIM: NIM fell to 4.2% (-73bps yoy) due to a decline in EA yield to 7.0% (-30bps) and an increase in CoF to 3.2% (+60bps).
• CIR: The drop in NII (-7% yoy) and higher opex (+8% yoy) pushed the bank's CIR to 44.6%, up from 41.5% last year.

 

Aug24 Insight:

• Net Profit: BBNI reported a net profit of Rp1.7tr (-12% mom, +13% yoy) as NIM dropped to 4.4% in Aug24.
• NIM: NIM fell by 18bps mom due to a decline in EA yield, while CoF remained steady, and LDR dropped by 211bps.
• CIR: CIR slightly increased in Aug24 to 47.0% due to the lower NIM, while opex remained high at Rp2.4tr (+1% mom, +17% yoy).
• Loan and Deposit Growth: Loans decreased by 1% mom, while deposits grew by 1% mom, bringing LDR back to 95.3%, down from 97.4% last month.
• CoC: CoC rose to 1.1% in Aug24 from 0.9% in Jul24 but remains in line with expectations (8M24 at 1.0%).

 

Summary:

• Overall Performance: BBNI's Aug24 performance was slightly weaker mom, as NIM continued to decline (consistent with our view on normalizing LDR), while opex remained elevated. However, 8M24 performance was still solid, as Aug23 was a low base. (Victor Stefano & Naura Reyhan Muchlis – BRIDS)

MACROECONOMY

Bank of Japan Maintained its Interest Rate at 0.25%

Bank of Japan maintained its interest rate at 0.25%. BoJ Governor Kazuo Ueda pushed the likelihood of an October rate hike further to the sidelines Friday with a cautious message that pointed to ongoing concern over the market meltdown that followed July’s rate increase. (Bloomberg)

 

SECTOR

Property: Government Extends PPN DTP Incentive and KPR Subsidy for 34,000 Units

The government has extended the 100% VAT-borne-by-government (PPN DTP) incentive for the housing sector from September to December 2024. Additionally, it has provided an extra subsidy for housing loans (KPR) targeting 34,000 units for low-income households (MBR) until the end of 2024. (Kontan)

 

CORPORATE

GOTO Forms Strategic Partnership with Tencent

GOTO has partnered with Tencent to utilize its cloud infrastructure and digital services. This collaboration will enable GOTO to leverage Tencent Cloud's Platform as a Service (PaaS) technology to enhance its ecosystem over the next five years. Tencent Cloud offers extensive infrastructure across 21 regions and 58 availability zones, including two data centers in Jakarta. (Kontan)

 

ISAT Reported 184,000 4G BTS Ownership in 1H24

ISAT expanded its 4G network across Indonesia, reaching regions beyond Java, including East Kalimantan, Nusa Tenggara, and the Riau Islands, with 184,000 4G BTS by mid-2024, a 13% increase from the previous year. The company is also growing its fiber-to-the-home (FTTH) services under Indosat HiFi, targeting secondary cities nationwide. Additionally, ISAT enhanced its service distribution points for both IM3 and Tri brands to improve accessibility across the country. (Kontan)

 

MEDC Plans US$150mn Debt Buyback

MEDC, through its indirect subsidiaries Medco Oak Tree Pte. Ltd. and Medco Bell Pte. Ltd., announced a tender offer to buy back two series of bonds totaling US$150mn. The offer includes US$100mn of 7.375% Senior Notes maturing in 2026 and US$50mn of 6.375% Senior Notes maturing in 2027. The buyback aims to reduce debt and restructure the repayment schedule, with payment made using internal funds and existing loan facilities. (Emiten News)

 

PTBA Enhances Coal Logistics with KAI Logistik Partnership

PTBA has signed a significant agreement with KAI Logistik to improve coal loading and unloading at the Kramasan Coal Terminal. This partnership aims to boost PTBA’s coal transportation capacity, supporting the monetization of its 2.98bn tons of coal reserves and 5.81bn tons of coal resources. (Emiten News)

 

Wuling Motors to Launch EV Battery Production in Indonesia by Late 2024

Wuling Motors will start producing MAGIC EV batteries in Indonesia by the end of 2024. The batteries feature advanced technologies, including MUST for lighter, stronger structures, and Advanced Cell Safety to prevent overheating and short circuits. A smart management system ensures accurate monitoring, enhancing performance, durability, and safety. (Emiten News)