FROM EQUITY RESEARCH DESK

IDEA OF THE DAY

Bank Syariah Indonesia: 1Q26 Earnings: In-line; Solid Gold Financing and Lower Cost of Fund Drove Higher Profitability (BRIS.IJ Rp1,700; BUY TP Rp3,100)

·         BRIS delivered a strong 1Q26 NP of Rp2.2tr (+10% qoq, +17% yoy), in line with ours and consensus est. at 26% of FY26F.

·         Gold financing doubled yoy (+26% qoq) reaching 8.8% of total portfolio, enhancing yield, fee-based income, and lowering CoC.

·         We maintain BUY rating with an unchanged TP of Rp3,100. Current valuation implies 1.4x FY26F PBV (close to -2SD) and 12.1% CoE.

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Elnusa: Monetizing Indonesia’s Upstream Revival, Unlocking Integrated Services Optionality (ELSA.IJ Rp700; BUY TP Rp1,110)

·         ELSA is positioned to capture Indonesia’s upstream activity cycle, supported by Rp12tr orderbook and high asset utilization.

·         We forecast FY26F net profit to rise 32% y-y, driven by upstream segment recovery (+11% y-y revenue growth).

·         We initiate with Buy rating and TP of Rp1,110 amid attractive growth with KSO/ LCO and PDSI acquisition as upside optionality.

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Macro Strategy: The Currency Conundrum

·         IDR undervaluation is widening, but persistent external pressure raises structural shift risks and increases BI hike probability.

·         Outflow risks remain the key catalyst, keeping pressure on market and FX, reinforcing the need for stronger stability measures.

·         Bond and equity divergence continued, with recent foreign inflows into SBN contrasting with persistent equity foreign outflows.

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RESEARCH COMMENTARY

BBCA (Buy, TP: Rp10,900) – Bank-Only Apr26 Results

Apr26 Insights:

·         Stable bottom line: BBCA booked NP of Rp4.8tr in Apr26 (–29% mom, +6% yoy), with the mom decline reflecting normalization from Mar26’s high base, while yoy growth was supported by provision release.

·         NIM continued to trend down: NIM declined to 5.4% (–28bps mom, –48bps yoy), driven by lower EA yield, while CoF remained relatively stable.

·         Soft PPOP on lower income: PPOP declined 30% mom and 1% yoy to Rp5.9tr, due to the lower NII (–5% mom, -1% yoy) and higher opex.

·         Opex remained elevated: Coupled with lower NII, opex increased 17% mom and 12% yoy, resulting in CIR rising to 31.7% (+1,003bps mom, +263bps yoy).

·         Lower CoC: CoC came in at 0.0% in Apr26 as the bank book provision release during the month.

·         Loan and deposit growth: Loans were flattish mom (+5% yoy), while deposits declined 1% mom but still grew 9% yoy, bringing LDR slightly up to 77.4%. CASA ratio stood at 85.0% (–18bps mom, +209bps yoy).

4M26 Insights:

·         Stable earnings trajectory: BBCA recorded NP of Rp20.8tr in 4M26 (+3% yoy), forming 34% of our and consensus’ FY26F, in line with expectations.

·         Pressure on NIM persists: NIM stood at 5.5% in 4M26 (–51bps yoy), driven by continued pressure on EA yield despite relatively stable CoF.

·         Moderate PPOP growth: PPOP grew 2% yoy, supported by stable NII and disciplined cost management, although offset by weaker other income.

·         Loan and deposit growth remained solid: Loans grew 5% yoy, while deposits rose 9% yoy, maintaining a strong liquidity position with high CASA ratio (~85%).

·         Low CoC maintained: CoC remained low at 0.3% in 4M26, indicating continued strong asset quality.

Summary:

·         Overall performance: We view BBCA’s Apr26 results as Neutral, with continued pressure on NIM from declining asset yields, while strong CASA franchise and low CoC remain key supports. Earnings remain stable, though growth is increasingly reliant on fee income and cost discipline amid margin pressure. (Victor Stefano & Naura Reyhan Muchlis - BRIDS)

BMRI (Buy, TP: Rp6,200) – Bank-Only Apr26 Results

Apr26 Insights:

·         Softer mom earnings, still strong yoy: BMRI booked net profit of Rp4.5tr in Apr26 (-5% mom, +26% yoy), mainly dragged by lower NII, while lower opex helped cushion the monthly decline.

·         NII declined on lower NIM: NII fell 10% mom as NIM dropped to 4.1% (-48bps mom).

·         NIM pressure mainly from lower yield: EA yield declined to 6.3% (-41bps mom), while CoF rose slightly to 2.2% (+7bps mom), putting pressure on NIM.

·         Opex decline cushioned PPOP: PPOP declined by only 5% mom despite weaker NII, supported by 11% mom lower opex due to 15% decline in other expenses.

·         Provisioning remained stable: Provision expenses were broadly flat mom at Rp710bn (+1% mom), while CoC stayed at 0.6%.

·         Higher LDR and Lower CASA: Deposits declined 2% mom while loans grew 1% mom, pushing LDR up to 94.0% (+261bps mom). CASA ratio also declined to 71.2% (-49bps mom).

4M26 Insights:

·         Solid cumulative earnings: BMRI booked net profit of Rp18.1tr in 4M26 (+19% yoy), forming 31% of our and consensus’ FY26F, ahead of 4M25 run-rate of 27%.

·         Loan growth drove NII: NII grew 10% yoy, supported by 18% yoy loan growth, despite a 24bps yoy decline in NIM.

·         NIM pressure mainly from lower yield: NIM declined to 4.3% (-24bps yoy), as the 61bps drop in EA yield outweighed the 42bps improvement in CoF.

·         Double-digit PPOP growth: PPOP rose 14% yoy, supported by 10% yoy NII growth, 7% yoy other operating income growth, and well-contained opex growth of only 2% yoy.

·         Credit cost remained low: Provision expenses declined 17% yoy, bringing CoC down by 20bps yoy to 0.5%, despite strong loan growth.

·         Higher LDR, weaker CASA: LDR increased to 94.0% (+148bps yoy), as loan growth of 18% yoy slightly outpaced deposit growth of 17% yoy. CASA ratio declined to 71.2% (-674bps yoy) as TD growth (+52.3% yoy) outpaced CA (7.4% yoy) and SA growth (+5.6% yoy).

Summary:

·         BMRI’s Apr26 results were slightly softer mom, mainly due to NIM pressure and lower NII, while yoy and cumulative earnings remained strong, supported by loan expansion, contained opex, and benign credit cost. (Victor Stefano & Naura Reyhan Muchlis - BRIDS)

Poultry (Overweight) – 2nd Week of May 2026 Price Update

·         Livebird prices slipped further to Rp18.8k/kg by end of the week, dragging the weekly average down 5.9% wow to Rp19.8k/kg.

·         Local corn prices continued to hold at Rp6.6k/kg, with the weekly average unchanged since late Apr26 at Rp6.6k/kg.

·         SBM prices surged to a YTD high of US$343/t mid-week before easing to close at US$334/t, with the MTD May26 average at US$328/t (+1% mom; +13% yoy).

·         The pullback in LB prices this week brings prices back toward the estimated breakeven level of ~Rp19k/kg, suggesting limited margin buffer for integrators. On the cost side, pressure is building: corn prices remain stubbornly elevated, and the spike in SBM to a YTD high adds a fresh headwind even as it partially retraced by week-end. The narrowing gap between LB prices and feed costs underscores the importance of a sustained recovery in LB prices for integrators' profitability outlook. (Victor Stefano & Wilastita Sofi – BRIDS)

MARKET NEWS

China’s retail sales growth slowed sharply to 0.2% YoY in April 2026

China’s retail sales growth slowed sharply to 0.2% YoY in April 2026 from 1.7% in March, marking the weakest expansion since December 2022 and missing market expectations, as the Iran war weighed on consumer demand. Weakness was broad-based, led by declines in automobile sales (-15.3%), home appliances (-15.1%), building materials (-13.8%), and furniture (-10.4%). Meanwhile, catering revenues rose 2.2%, highlighting stronger services demand. Retail sales excluding automobiles increased 1.8%, while monthly retail sales fell 0.5% after a 0.1% decline in March. (CNBC)

Indonesia’s external debt growth slowed to 0.8% YoY in 1Q26

⁠Indonesia’s external debt growth slowed to 0.8% YoY in 1Q26 with total external debt reaching USD 433.4 billion, compared with 1.9% growth in Q4 2025. Government external debt rose 3.8% YoY to USD 214.7 billion, supported by foreign inflows into global government bonds, while private external debt contracted 1.8% YoY to USD 191.4 billion due to lower borrowing by financial and non-financial corporations. BI stated Indonesia’s external debt structure remained healthy, with the external-debt-to-GDP ratio declining to 29.5% and long-term debt accounting for 85.4% of total external debt. (Bank Indonesia)

AMMN Director Irwin Wan Resigns

AMMN announced that Director Irwin Ka Pui Wan has officially submitted his resignation, with the company set to seek shareholder approval at its Annual General Meeting on 19 May 2026. Irwin, who joined AMMN in 2016 and became director in 2021, played a key role in the company’s operational transformation and brings more than two decades of global mining experience. (Bisnis)

XPeng Acquires Majority Stake in Erajaya’s EV Manufacturing Unit

Chinese premium EV maker XPeng has officially acquired a 90.1% stake in PT Era Industri Otomotif (EIDO), a subsidiary of PT Sinar Eka Selaras Tbk. (ERAL), strengthening its presence in Indonesia’s growing electric vehicle market. Following the transaction completed on 13 May 2026, ERAL’s ownership in EIDO declined to 9.9%, while XPeng became the majority shareholder of the EV manufacturing and assembly entity. (Bisnis)