FROM EQUITY RESEARCH DESK

IDEA OF THE DAY

Bank Syariah Indonesia: 2Q26 Earnings: In line; Lower Provisions and Loan Growth Support Bottom Line (BRIS.IJ Rp1,805; BUY TP Rp3,100)

• BRIS posted 2Q26 net profit of Rp2.0tr (-11%qoq, +5%yoy), bringing 1H26 NP to Rp4.2tr (+11% yoy), in line with ours and cons.
• Lower CoC on a corporate loan upgrade offsets NIM pressure, with stable NPF supported by improving corporate & MSME segments.
• We maintain Buy rating with an unchanged TP of Rp3,100, as we keep our FY26F estimates and valuation unchanged.

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RESEARCH COMMENTARY

BBNI (Buy, TP Rp4,800) – Jul26 Results (Bank-only)

Jul26 Insights:

·         Eased bottom-line growth: BBNI posted soft net profit of Rp1.6tr in Jul26 (-13% mom, -6% yoy), driven by higher CoF and opex, partly offset by lower provisions.

·         NIM decreased due to a rise in CoF: NIM fell to 3.4% (-13bps mom, -41bps yoy), as CoF increased to 3.2% (+40bps mom, +11bps yoy), negating the higher EA yield, which increased 31bps mom to 6.6%, suggesting that loan yield repricing lagged behind the liquidity squeeze.

·         High opex drove CIR higher: Opex rose 20% mom/8% yoy, bringing PPOP to Rp3tr (-11% mom, +12% yoy) and pushing CIR up to 49% (+725bps mom, -93bps yoy).

·         Lower mom provisions cushioned earnings: Provision declined 44% mom, bringing CoC down to 0.8% (-62bps mom, -9bps yoy), supporting the bottom line.

·         Deposits outgrowing loans: Customer deposits increased 4% mom/29% yoy, outpacing loan growth of 2% mom/27% yoy to Rp970tr, dragging LDR down to 85.5% (-226bps mom, -125bps yoy). CASA improved 53bps mom to 66.4%, driven by a 9% mom increase in CA, amid stable SA.

7M26 Insights:

·         Decent bottom-line growth: BBNI booked net profit of Rp12.5tr in 7M26 (+6% yoy), representing 60% of our FY26F and 59% of consensus estimates, broadly in line with the 59% achievement in 7M25.

·         Strong NII despite NIM compression: NII was up 14% yoy to Rp25.3tr, supported by +27% yoy loan growth, despite a 23bps yoy decline in NIM to 3.6%, driven by a lower EA yield of 6.4% (-29bps yoy), despite lower CoF at 2.8% (-21bps yoy).

·         PPOP remained resilient despite higher opex: PPOP increased 14% yoy to Rp20.9tr, supported by 11% yoy growth in other operating income, partly offsetting a 12% yoy rise in opex, with CIR netting at 46.1% (-31bps yoy).

·         Higher provisions increased CoC: Provisions rose to Rp5.4tr (+33% yoy), driving CoC to 1% (+9bps yoy), but still within management guidance of 1.0–1.2%.

·         Lower CASA driven by TD: CASA portion decreased to 66% (-464bps yoy), as a 50% yoy increase in TD outweighed a 29% yoy increase in CA.

Summary:

·         We view BBNI’s Jul26 performance as Neutral, as NIM compression alongside elevated opex was enough to offset high loan growth and solid fee-based income. However, rising CoF should be monitored, as it reached a YTD high and already surpassed the FY25 level. (Victor Stefano & Nataniella Eva Kezia)

TPIA (Not Rated) - M&A Update: Mobility Expansion via Cycle & Carriage Acquisition

• The Deal: TPIA acquires C&C's Singapore/Malaysia auto retail business from Jardine Matheson for SGD265mn cash, implying ~3-4x FY25 P/E (SGD 63mn net profit) vs SGD370mn book value. Minimum ~SGD100mn negative goodwill expected
• Strategic Rationale: Complements TPIA's Esso fuel retail buildout (60 SG stations) , forming a Production => Retail => Mobility ecosystem. C&C brings a 127-year Mercedes-Benz-anchored multi-brand platform across Singapore (7 sites) and Malaysia (12 sites) . Guided group earnings uplift: USD450-550mn p.a. across four initiatives.
• Leverage Check (1H26 actuals): TPIA's debt/capitalization stood at 55% (up from 54% FY25), net debt ~US$2.5bn. At ~US$207mn (0.782 FX), the deal is ~8% of net debt and ~11% of annualized EBITDA, small but not immaterial given TPIA's already-rising leverage trend.

Watchpoints: No IRR/ROIC hurdle disclosed despite direct Q&A. C&C's own EBITDA/leverage undisclosed, implied multiple unverified independently. Integration execution, OEM continuity, and auto-dealership working capital discipline remain key risks to monitor. (Andhika Audrey & Taufan Fadhillah)

MARKET NEWS

Indonesia’s Current Account Deficit Widened Sharply to 3.3% of GDP

Indonesia’s current account deficit widened sharply to a record USD12.49bn in 2Q26, equivalent to 3.3% of GDP, from USD2.89bn a year earlier. The deterioration mainly reflected a sharp narrowing in the trade surplus to USD1.32bn from USD10.52bn, as higher oil prices drove stronger imports. The services deficit also widened to USD5.98bn, while the primary income deficit eased slightly to USD9.67bn. Despite the sharp 2Q deficit, BI maintains its 2026 current account deficit forecast at 0.5–1.3% of GDP. (Bank Indonesia)