FROM EQUITY RESEARCH DESK

IDEA OF THE DAY

Metal Mining: Proposed Royalty Hike Will Pressure FY25 Earnings (NEUTRAL)

• The MEMR on Saturday 8th Mar25 officially proposed an increase in royalty rate for Coal, Nickel, Copper, Gold, Silver, and Tin.
• The impact on royalty hike varies, though INCO and TINS are most impacted due to their large exposure to affected products.
• We reiterate our Neutral rating on the metal mining sector with a pecking order of ANTM> NCKL> TINS> INCO> MBMA> MDKA.

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Jasa Marga: Normalization of revenue growth, yet healthier balance sheet is still underappreciated (JSMR.IJ Rp 3,850; BUY TP Rp 5,900)

• We expect toll road revenue to grow by 9%/10% in FY25F/FY26F, driven by traffic growth of 1.6%/2.3% yoy, and fewer special tariff adjustments.
• We expect higher capex (~Rp11tr/yr) in FY25F-FY26F, yet leverage will remain at ~1x net DER; expect interest exp. to increase in FY26F.
• Market has not appreciated JSMR’s healthier balance sheet (~1x net DER) post-JTT divestment. Reiterate Buy rating with a TP of Rp5,900.

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Macro Strategy: The Specter of Growth Scarcity

• A weaker US economy has become a key headline, and the imposition of tariffs would only further exacerbate the situation.
• Our findings indicate mixed US economic signals, with market-Fed rising divergence historically increasing volatility.
• BI is gradually injecting liquidity, but sluggish money supply growth still poses risks to economic trajectory, requiring further easing measure.

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RESEARCH COMMENTARY

Automotive (Overweight): 4W Sales and 2W Sales in Feb25

• 4W wholesales: 72.3k (+16.7 mom/+2.2% yoy), bringing 2M25 sales to 134.1k units, represents 15% of our and Gaikindo target.
• 4W retail sales: 69.9k (+9.1% mom/-0.8% yoy).
• 2W sales: 581.3k (+3.7% mom/+4.0% yoy).

 

Comment: We observed a monthly improvement in 4W wholesales and retail sales, supported by the annual IIMS event, which recorded 16% yoy growth in terms of unit sold. Several brands posted significant monthly growth for wholesales, with Toyota (+10%), Daihatsu (+20%), Honda (+20%), Mitsubishi (+33%), and Wuling (+92%), with the latter leading the gains. Despite Toyota’s sales remaining strong, growing by +3.7% yoy, ASII's market share declined to 53% in Feb-25 (-400 bps mom, vs. ~56% avg. market share) due to strong growth from other brands.

 

Additionally, 2W sales improved in Feb25 by +4.0% yoy; however, cumulative 2M25 2W sales slightly declined by -0.8% compared to 2M24. We maintain our OVERWEIGHT stance on the sector and reiterate our Buy rating for ASII with a target price of Rp5,800. (Richard Jerry, CFA & Sabela Nur Amalina – BRIDS).

 

 

EXCL (Buy, TP: Rp2,800) - Sellside analyst call with XLSmart; Key takeaways:

XLSMart reiterated the merger benefits from a) scale and commercial presence b) network synergies, c) ecosystem support from the shareholders.

• XLSmart emphasized a) the larger scale of the new XLSmart and how important it is amid technology advancements, b) the in country telco consolidation experience of Axiata shareholder, c) the deep knowledge of Sinar Mas conglomerate in the local economy d) 20years+ telco experience for each director in XLSmart
• Categorizing the benefits into shareholders, industry, customers and employees. Special focus on ICT and enterprise revenue growth with 22% CAGR 2023-28.
• No plans to reduce the workforce. The nominee CEO of the the mergeCo aims to maintain the current operational momentum. Personnel is not immaterial cost, but the synergies focus is on the network.
• Network synergies will be realized by decommissioning overlapped tower sites. On aggregate there are 67,000 sites of which 20-30% are overlapped or circa 13,000-15,000. Management has no timeline as to when this process will be concluded. Between April and June 2025, the company will discuss with tower providers and vendors for the decommissioning and guided that it will incur network synergies from 2H25.
• XLSmart did not confirm they will return any of the 900MHz spectrum. It still argues based on 152MHz spectrum holding post merger (excl. 900MHz is 137MHz).
• XLSmart will maintain separately the 3 different brands XL, Axis, Smartfren. Each one has a distinct target market. XL has a more premium value, Axis is closer to the youth segment, FREN is focused on the big cities. (Niko Margaronis & Kafi Ananta – BRIDS)

 

THR for Ojol Drivers and Workers: Government Mandates and Gojek and Grab Responses

• President Prabowo Subianto appealed to platform companies to provide THR in cash to their driver partners..Affected drivers: Approximately 250,000 full-time ojol drivers and 1-1.5 million part-time drivers.
• Minister of Manpower will issue a circular (SE) that Regulates THR payments for ojol drivers. Includes sanctions for app-based transportation companies (applicators) that do not comply
• Gojek response: Introduces "Tali Asih Hari Raya" ProgramGojek launched the "Tali Asih Hari Raya" program, providing direct cash assistance in the form of Bonus Hari Raya (BHR) before Idul Fitri. The bonus is given to eligible driver-partners who meet specific criteria. GoTo (Gojek’s parent company) treats this financial disbursement as a goodwill effort, ensuring it remains manageable within the company’s capacity.
• Grab: Introduces "Bonus Hari Raya" (BHR) Program. Bonus amount is based on: Driver activity, Order completion rate, Number of days and hours online and Driver rating.
• Additionally Grab launches the "Traktir Driver" program: Encourages customers to tip drivers without deductions, ensuring drivers receive the full amount. (Company, Katadata)

 

Comment: GOTO treats this cash assistance as goodwill effort for the drivers, a form of investment we believe to maintain that goes to improve the well-being of its drivers. GOTO emphasizes this amount is within the company's capacity and hence manageable. Tomorrow on the 12th of March GOTO will conduct its earnings call and potentially provide details. (Niko Margaronis & Kafi Ananta – BRIDS)

 

MARKET NEWS

MACROECONOMY

China Imposes 10-15% Tariffs on U.S. Farm Products in Retaliation

China's 10–15% tariffs on U.S. farm products, including grains, proteins, cotton, and fresh produce have taken effect. The move is a retaliation in the trade war and aims to boost China's agricultural self-sufficiency. With a slowing economy, Beijing seeks to protect farmers and manage grain oversupply. (Bloomberg)

 

Japan’s 10-year Bond Yield Hit 1.575%

Japan’s 10-year bond yield hit 1.575%, the highest since 2008, as base pay rose at the fastest pace in decades. Weak demand at a five-year debt auction also pushed yields higher. While the BOJ is not expected to hike rates next meeting, markets see an 85% chance by July and full certainty by September. Some forecasts predict the yield could reach 1.7%–2% by year-end. (Bloomberg)

 

SECTOR

Commodity Price Daily Update Mar 10, 2025

Automotive: Surge in Used Car Sales Ahead of Lebaran 2025

Used car sales, particularly through auction platforms like AUKSI, have risen 20% since Jan25, driven by demand for both passenger and commercial vehicles amid increased travel and business activity. While price hikes remain a yearly trend, this year sees stronger demand for commercial vehicles. The used EV market remains limited due to charging infrastructure and battery concerns, but hybrid sales are gaining traction as a fuel-efficient transition option for consumers. (Kontan)

 

CORPORATE

ADHI Allocates Rp1.6tr in Capex for 2025

ADHI has allocated Rp1.6tr for capex in 2025, primarily for capital investments and fixed asset purchases. The company will have 105 ongoing projects, with 91% in engineering and construction, 4% in property and hospitality, 4% in manufacturing, and 1% in investments and concessions. (Kontan)

 

BBNI Partners with VinFast to Strengthen Indonesia’s EV Ecosystem

BBNI has officially partnered with Vietnamese electric vehicle (EV) manufacturer VinFast. As part of this collaboration, BBNI will provide consultation services and facilitate VinFast and other Vingroup ecosystem companies in accessing various transactional banking products and services. Additionally, BNI will support business partners in developing green infrastructure, aligning with VinFast’s mission to expand the electric vehicle ecosystem. (Kontan)

 

BBRI Prepares Rp32.8tr in Cash for Eid 2025

BBRI has allocated Rp32.8tr in cash to meet the increased transaction demands during the Eid holiday period in 2025, from March 28, 2025, to April 7, 2025, spanning 11 days. (Bisnis)

 

BRMS Partners with Macmahon Indonesia to Develop Underground Mine

BRMS announced that its subsidiary, PT Citra Palu Minerals (CPM), has appointed PT Macmahon Indonesia (MMI), a subsidiary of Macmahon Holdings Limited, as the underground mining services contractor for the Poboya gold mine in Palu, Sulawesi. BRMS hopes that this collaboration with MMI, a contractor with an international reputation, will ensure the commencement of underground mining operations at Poboya, Palu, in 2027. (Kontan)

 

Telkomsel and Pegatron 5G Partner to Develop Smart Manufacturing in Batam

Telkomsel and Pegatron 5G, the 5G business unit of global electronics manufacturer Pegatron, have signed a Memorandum of Understanding (MoU) at the Mobile World Congress (MWC) 2025 in Barcelona to develop smart manufacturing solutions in Indonesia. This partnership aims to drive digital transformation in the manufacturing sector by implementing advanced 5G-enabled solutions at PT Pegaunihan Technology Indonesia, Pegatron’s subsidiary in Batam. Leveraging Telkomsel’s cutting-edge 5G network, the initiative will integrate IoT and automation into production processes, enhancing efficiency and innovation in Indonesia’s industrial landscape. (Kontan)

 

YUPI Sets IPO for Mar25 with CCPI to Hold 90% Stake

PT Yupi Indo Jelly Gum (YUPI) plans an IPO on 21st Mar25, offering 10% shares (7% divestment, 3% new shares) at Rp2,100–2,500/share, targeting proceeds of Rp1.8tr–2.1tr. Post-IPO, CCPI (Affinity Partners) will own 90% and become the majority shareholder. (Investor Daily)