Perdagangan Kurang Bertenaga, IHSG Siang Ini Stagnan

Kehilangan gairah, akhir sesi 1 perdagangan saham di bursa domestik akhir pekan ini mendatar. Indeks Harga Saham Gabungan (IHSG) stagnan ke poin ke posisi 5.420,38 poin. Indeks LQ45 melandai ke posisi 942 poin. Jakarta Islamic Index (JII) naik +0,22% ke posisi 712 poin. Indeks Kompas 100 turun -0,01% ke level 1.190 poin. Transaksi yang tercapai pada sesi 1 senilai Rp2,845…

Key takeaways on JFCC discussion on electricity

 We attended a Jakarta Foreign Correspondents Club (JFCC) discussion on electricity, below are the key takeaways:  What is the current electricity condition? First, as of 2014, the installed capacity has reached 53,310 MW. The State Electricity Company (PLN), Independent Power Producer (IPP) and others are responsible for 70%, 20%, and 10% respectively of the installed capacity. Second, the…

BDMN: 1Q15 earnings: Below consensus

§ 1Q15 net profit of IDR687bn (-21.5% y-y; +37.8% q-q): BDMN reported 1Q15 net earnings of IDR687bn (-21.5% y-y, +37.8% q-q). While bottom line was in line with our estimate (23.3% of 2015 forecast), it was lower than consensus’ expectation (19.1%). § NIM declined on remix of loan portfolio towards SME: The decline in NIM to 8.3% (-30bps y-y, -10bps…

BRAU: ASML akan membeli seluruh saham Asia Resources Minerals, induk perusahaan BRAU

• Dikutip dari kontan, Asia Coal Energy Ventures Limited (ACE), perusahaan yang dikontrol oleh anak perusahaan Grup SInarmas; bernama Argyle Street Management Limited (ASML); akan membeli seluruh saham Asia Resource Minerals Plc, induk usaha BRAU. • Saat ini ASML telah menguasai sekita 4.7% saham ARMS. ACE telah mengajukan penawaran akuisisi seluruh sama seharga 41 pence per saham (IDR779 per saham),…

Mar15 trade surplus paves way for lower CAD

 Three months in a row of surplus. Trade recorded a surplus of US$1.1bn in Mar15, the highest since Dec13, higher than our and consensus forecasts at US$674mn and US$589mn, respectively. The cause was different from the first two months, as Mar15 surplus was due to export outperforming import. All in all, the three months in a row of surplus…

PGAS: Bracing the Storm

 Key risk of our previous call, i.e. government control on PGAS’s gas distribution margin has just emerged. Ministry of industry proposes domestic gas price reduction. Meanwhile, weak demand on gas and loss-making LNG business should make 1Q15 earnings a disappointment. Downgrade to SELL with TP: Rp3,950.  Now, it’s about weak demand on natural gas, not about limited supply….

Indonesia Economics – March trade: On track for a solid 1Q current account balance

● There was a significant upside surprise in the 1Q trade balance (+US$1.1 bn versus consensus estimate of +US$0.6 bn), driven by much better-than-expected exports and still soft import growth. ● The improvement in exports was broad-based, while weakness in imports suggests still sluggish domestic demand. ● This should translate into a slightly below 1% of GDP current account deficit…

GIAA: Taking off

§ Strong support from scheduled and chartered flights: GIAA indicated preliminary 1Q15 results on 15 April, with a turnaround to positive earnings from a net loss of USD164mn in 1Q14, helped by improved revenue and lower operating costs. The improvement in domestic flight revenue was driven by a higher seat load factor (SLF) on lower competition from domestic carriers like…

TELE: Potensi meningkatnya pangsa pasar di bisnis distribusi voucher

• Dalam riset transfer coverage saham Tiphone Mobile (TELE), Emanuella Clarissa mempertahankan rekomendasi BUY dengan TP IDR1,150 per saham (19x 2016 PER). • Potensi meningkatnya pangsa pasar untuk mempercepat pertumbuhan pendapatan, seiring seleainya akusisi Simpatindo, TELE akan mendapat tambahan pangsa pasar 8% di Tsel Voucher, membawa total pangsa pasar menjadi 20%, efektif Jan 2015. • Tambahan pangsa pasar, Clarisa meperkirakan…

INPP to enter stake into PLIN

INPP to enter stake into PLIN: Indonesian paradise property (INPP) to acquire 25.91% stake of PLIN for Rp2.3trn or Rp2,500 per share, 7.4% discount to market price yesterday close. They will do Rp2.8trn rights issue or 77.12% new shares

Legislation to ban alcohol to be debated in parliament

Legislation to ban alcohol to be debated in parliament: The secular parties like Golkar, PDI-P & Partai Demokrat have agreed to deliberate the bill. The Indonesia Malt Beverage industry says 200K people are employed in the sector. Comment: This progress this far, leave alone a passage, should call into question the much vaunted Jokowi reforms that the equity market is…

Power consumption slows growth in weak economy

1Q15 electricity consumption by the country’s industries is seeing a slowdown in growth with industry players scaling back their production. Based on PLN, sales of its 1Q15 electricity sales was 48.04 terrawatt hours (TWh), a slight increase of 2.6% YoY, compared to 46.81 TWh in 1Q14. 1Q15 sales growth was slower than that of same period last year which recorded…

DILD expects to write off Jakarta reclamation

Intiland expects to write off Jakarta reclamation: Intiland Development (DILD) expects to write off Rp100bn if it lose license on Jakarta land reclamation projects that recently being re-evaluated by regional house of representative. The company targets Rp3.0trn presales this year, 18% growth, excluding this project.

Indonesian Paradise to buy 26% stake in Plaza Indonesia for Rp2.3tn (US$178m)

Indonesian Paradise to buy 26% stake in Plaza Indonesia for Rp2.3tn (US$178m). Indonesia Paradise will raise Rp2.8tn from a rights offering in June to finance the acquisition and will sell 8.62bn new shares, or 77.12% of the company’s capital. The existing shareholders, which owns 100 shares, would be eligible to buy 327 new shares at Rp325 from June 5 to…

GIAA strong Q115 performance

GIAA strong Q115 performance: GIAA reported that its passenger carried and revenue in Q115 increases by +12.5% YoY and +10% YoY respectively. For the next quarter, GIAA estimates the passenger and revenue growth to remain like Q115 BI 15

The ministry of transportation appoints state railway operator Kereta Api Indonesia as strategic partner for Jakarta high-speed airport railway

The ministry of transportation appoints state railway operator Kereta Api Indonesia as strategic partner for Jakarta high-speed airport railway. The ministry wants a special treatment for KAI regarding presidential decree No.38/2015 where KAI can be appointed as the operator for the project. The gov’t has completed feasibility study on the 35km railway project and expect the tender process for the…

ACST: Buffed up

 Maintain BUY on under-researched stock and raise TP to IDR6,500 (FY16 PER of 22x).  Strategic alignment with ASII group to underpin 2016 new contract growth.  Upside risk potential given strong YTD achievement. Aligning strategy with Astra group With United Tractors (UNTR) fully on board, integration phase through strategic alignment with Astra’s (ASII) business units is currently under…

Indonesian Coal Sector (Power rangers)

One of Jokowi’s key priority infrastructures is electricity. According to state-owned electric company’s (PLN) 2015 – 2024 plan, 70.4 GW of power plant capacity needs to be built in 10 years. The combined investment needed will be US$132 bln, including US$62 bln from independent power producers (IPP) over the same period. The 10 year plan relies on 2 main factors,…

Ministry of Industry is planning to lower the price of gas that’s sold to Industry with 4 scenarios

Ministry of Industry is planning to lower the price of gas that’s sold to Industry with 4 scenarios, from 10%, 20%, 30%, and 40% decrease in price. Despite lower revenue form gas sales, this initiative will increase tax revenue and economic output by larger amount. Comment: PGAS has a near monopoly on industrial gas customers. A price reduction without a…

Indonesian Automotive – Unexciting Preliminary 2W Data; Honda Gained Market Share

- 2W number in March remains low at 562k units; 1Q15 down 18.3% YoY — This was up 1.1% mom but down 22.5% YoY, bringing 1Q15 volume of 1.62m units, down 18.3% YoY and accounting for only 20% of our FY15 forecast of 8.21m units (see Figure 1), up 4% YoY. There is downside risk to our number looking at…

Regional Weekly: Funds Surged Into Hong Kong Market

The inflow of liquidity into the HK equities market contributed to sharp share price increases the past week. We took the opportunity to downgrade China Railway Group to NEUTRAL from Buy. In regional telcos, we are OVERWEIGHT on the Thai and Indonesian telcos, with AIS and Telkom as our picks. We are also OVERWEIGHT on the Indonesian retail sector. ¨…

ACES: No sign of pick up

· March Rev +5.7% YoY (Feb +7% YoY) with SSS growth -1.5% YoY similar to the -1.7% YoY reported in Feb. However, the company shifted their annual “Boom Sale” promotion to March/April this year vs April/May in 2014. · Ex-Java remains weakest with -3.2% YoY SSSG. All geographies were negative in March. · Q115 Revenue grew +4.1% YoY (vs +7.4%…

East Kalimantan Government requires miners and plantation companies operating in the region to move their headquarter within the area

East Kalimantan Government requires miners and plantation companies operating in the region to move their headquarter within the area. The ruling is issued in a form of Governor Regulation (Pergub) No.17/2015, and aims to support data and information system integration (including management of business permits, monitoring and controlling, and evaluation). The ruling will also require mining companies to build mine-mouth…

A bill initiated by the Lawmakers proposes banning all consumption of alcoholic beverages

A bill initiated by the Lawmakers proposes banning all consumption of alcoholic beverages. The bill which has been initiated by the PPP and PKS could land a person in jail for three months to two years as it will be treated similarly to drug trafficking. The bill will put in place a ban on the sale, production, distribution and consumption…

Gov’t insists on tax goal despite weak turnout in Q1

Gov’t insists on tax goal despite weak turnout in Q1. The government insists that it can reach an ambitious tax-collection target this year as it is preparing a set of strategies after a weak turnout in tax revenue in the first quarter of the year. The gov’t netted only 15% of its Rp1,480t target. Ministry of finance data showed that…

OJK processing HSBC merger plans

HSBC Asia Pacific Holdings Ltd. (UK) plans to combine two units of its banking business in Indonesia: HSBC bank Indonesia and Bank Ekonomi Raharja. While the company has submitted the letter of intent to the Financial Services Authority (OJK), this merger is unlikely to happen this year. Meanwhile, Bosowa Corporindo has officially become the controlling shareholder of Bank Bukopin (BBKP)…

1Q15 tax revenue collection lower than the same period last year

As of 1Q15, tax collection reached Rp198.2tn, lower than the same period of last year at Rp210.1tn (or contracted 5.63%). One of the sources for the tax decline was lower realization of value added and luxurious taxes (the sum of both of them reaches Rp83.1tn). The directorate of general tax (DGT) mentioned the decline of value added was owing to…

Stocks Mostly Higher, NASDAQ Bucks Trend

The U.S. equity markets closed the trading session on either side of the flatline amid some mixed domestic earnings and economic reports. Treasuries were higher following another disappointing retail sales report, while separate releases showed wholesale price inflation was roughly inline with expectations, small business optimism surprisingly declined and business inventories rose more than projected. Dow member JPMorgan Chase &…

RALS: Fading Away

 RALS‘s 3M15 YTD SSSG performance has hit a 5-year low with ex-Java being the worst performer. We believe RALS’s performance will continue its downtrend due to i) under pressure sales in outer islands, ii) store closures, and iii) mounting food waste cost from supermarkets. Downgrade to Sell, TP Rp660.  Hitting rock bottom. RALS booked SSSG of -10.2%yoy with…

Tax amnesty likely implemented in 2017

The directorate of general tax (DGT) signaled that tax amnesty will likely be implemented in 2017 which will also be the year of tax payer reconciliation. Meanwhile, it will take this year and 2016 as the period of tax development and law enforcement implementation. And hopefully Indonesia could reach a self sufficient economy through tax in 2019

Indonesia market update: 1Q15 results preview

The good, the bad & the ugly 2015 PE: 20.8x, the highest in the region on lower earnings Following recent 4Q14 results releases, we have fine-tuned all 95 stocks under our coverage (76% of the total market capitalization of the index) to take into account the most recent operating trends in the marketplace. In line with Indonesia’s 1Q15 subdued economic…

Focus Group Discussion on Indonesian property luxury tax

 Discussion between groups on Indonesian property luxury tax. We attended the Focus Group Discussion (FGD) which is led by University of Indonesia last week. The purpose of the FGD is to discuss the impact of the luxury taxes on Indonesian property and what kind of regulations should be implemented. Currently luxury tax (PPn BM of 20%) only applies to…

Ministry of Industrial Estate is urging the government to intervene and reduce gas price again

Ministry of Industrial Estate is urging the government to intervene and reduce gas price again, giving a few scenario that the additional tax revenue from industrial players will be more than enough to offset the reduction of government’s revenue from the gas industry. Industrial estate also complains that Perusahaan Gas Negara (PGAS) selling price of USD11/mmbtu to industrial is much…

Indonesia: Coal output falls as prices continue to lag

Coal output dropped by 21 percent in the first three months of the year as low prices for the commodity forced mining companies to reduce activities to cut production costs. Data from the Energy and Mineral Resources Ministry’s directorate general for minerals and coal shows the total output for the first quarter of the year amounted to 97 million tons,…

EXCL eyes new 10m smartphone subscribers this year

XL Axiata (EXCL) eyes new 10m smartphone subscribers this year. XL has an estimated 16m subscribers using smartphones. The company is working with China’s Xiaomi to offer bundling package of XL number and Xiaomi Redmi 2 phone. The Xiaomi is already a 4G compatible phone. Therefore, XL expects to have 25m smartphones’ subscribers with the bundling package and other new…

China’s Xiaomi plans to assemble its product in Indonesia this year in a bid to boost the percentage of local content ahead of the government’s “made in Indonesia” plan that will impose a mandatory 40-percent local content requirement for 4G handsets

China’s Xiaomi plans to assemble its product in Indonesia this year in a bid to boost the percentage of local content ahead of the government’s “made in Indonesia” plan that will impose a mandatory 40-percent local content requirement for 4G handsets. Xiaomi would use contract manufacturers in Indonesia in the same way the phone maker had done in China and…

APLN: Property developer Agung Podomoro Land Q1 marketing sales down 48.6% YoY

Property developer Agung Podomoro Land Q1 marketing sales down 48.6% YoY. The company recorded Rp939.7b of marketing sales for the first three months, down 49% compare to the same period a year ago. The main reason for the decline is due to continuing slow demand in since 2014 coupled with the gov’t plan to increase taxes for mid to high-end…

Tax amnesty to be realized soon

A group of Parliament members expects the program could allow up to Rp3,000t (US$230b)to be brought back by Indonesians with funds parked offshore. The Parliament and Government have discussed the issue several times and are now preparing the legal framework for the scheme to work (amongst others, KPK or corruption eradication commission, Police and the Constitutional Court). A program recently…

HMSP: Cigs manufacturer Sampoerna operated new Rp2tn (US$154mn) factory in Karawang, West Java to increase export contribution

Cigs manufacturer Sampoerna operated new Rp2tn (US$154mn) factory in Karawang, West Java to increase export contribution. Sampoerna’s products are in 39 countries across the world, but Malaysia is its highest export contributor. Last year, the company manufactured 109.7bn sticks of cigarettes last year, claiming that the company got 34.9% market share. On the hand-made cigs (SKT), the company sees a…

ASII: Automaker BMW launches locally assembled X5

Automaker BMW launches locally assembled X5. Although locally assembled, all auto parts are still imported. The X5 is priced at Rp1.14bn (US$88k). With the addition of the X5 to the firm’s assembling units, it should be able to reach its 2015 local producer target of 2.4k units, (+) 17% YoY from 2,045 units last year.

Central government halts Jakarta reclamation

The Central Government has decided to suspend the implementation of the controversial National Capital Integrated Coastal Development also known as Jakarta reclamation, pending an evaluation. The research department at Maritime Affairs and Fisheries Ministry has ordered to review the plan drafted in conjunction with the Netherlands. The initial plan to reclaim the land and build giant seawall is to tackle…

March Cement Sales rebounded 8.4% MoM to 4.6mn tonnes

Indo cement association (ASI) released Mar2015 cement sales figure: Mar2015 domestic cement sales rose by 8.4% MoM, but fell by 6.4% YoY to 4.6m tonnes. Hence, overall 3M15 sales of ~13.6m tonnes were still weak, (-) 3.2% YoY. BUT, good to see a recovery MoM. On a MoM and YoY basis (domestic sales): SMGR (2.02m tonnes) (+)5.3% MoM, (-)6% YoY…

ACES: March 2015 was another slow month…

● March 2015 was another slow month for Ace Hardware (ACES), where same-store sales growth came at -1.5% YoY. Outer islands appear to be performing worse than Jakarta and rest of Java, as has been observed across all Indonesia retailers. ● Aside from the possible impact of new stores cannibalisation, the negative SSG is due to weaker customer traffic into…

Indonesian plantations: Under pressure

Under pressure § Narrowing gap between CPO and soyabean oil: Soybean oil and palm oil are naturally interchangeable goods, translating to strong correlation in prices for both commodities. Due to the abundance of global soyabean oil inventory (exhibit 12), soybean oil is currently trading at its lowest price in 5 years (exhibit 13) resulting in a narrowing of the CPO…

MYOR: Better margins expected

 Reiterate BUY on growth potential and easing costs pressure. Upgrade TP to IDR35,000 or 32x PER FY16F, in line with 36M historical mean.  Export business serves as natural hedge to currency exposure while lower commodities prices and ASP increase provide support for its margin.  Mass-market consumption recovery to drive growth across categories. Easing costs pressure for better…

RALS: March Sales Data

 Another slow month. RALS booked SSSG of -10.2% yoy with revenue of Rp510bn in Mar15 which brought overall 1Q15 SSSG performance to -3.3% yoy. Ex-Java remains the worst performer among others with -12.2%yoy, followed by rest of Java with -8.6%yoy and Greater Jakarta area with -8.7%yoy in Mar15. We view lower purchasing power in outer islands combined with still…

LPCK: 1Q15 marketing sales number already 51% of FY15 marketing sales target

 Strong accomplishment on 1Q15 marketing sales number. LPCK booked 1Q15 marketing sales number of Rp1,276tn. This is already 51% of LPCK’s FY15 marketing sales target of Rp2.5tn. Solid number is mainly on the back of Orange County launches (Pasadena and Westwood), in which the company booked marketing sales of Rp793bn. LPCK’s industrial estate JV (Delta Silicon 8) contributes marketing…