The JCI August 10, 2020
Aᴜɢᴜsᴛ 10, 2020
* Tʜᴇ JCI ᴛʀᴀᴅɪɴɢ ʀᴀɴɢᴇ: 5,075ᴘᴛ – 5,200ᴘᴛ (Yᴇsᴛᴇʀᴅᴀʏ ᴄʟᴏsᴇ: 5,144ᴘᴛ)
* Wᴀʟʟ Sᴛʀᴇᴇᴛ ᴄʟᴏsᴇᴅ ᴍɪxᴇᴅ ᴡɪᴛʜ ᴛʜᴇ Nᴀsᴅᴀǫ ʟᴏsᴛ ᴏꜰ ᴛᴇᴄʜ’s sʜᴀʀᴇs ꜰᴀʟʟ
* Tʜᴇ JCI ɪs ᴇxᴘᴇᴄᴛᴇᴅ ᴛᴏ ꜰʟᴜᴄᴛᴜᴀᴛᴇᴛ ᴀɴᴅ sᴜᴘᴘᴏʀᴛᴇᴅ ʙʏ sᴛᴀʙʟᴇ USDIDR ᴄʟᴏsᴇ
Morning,
The Jakarta Composite Index (JCI) today (10/8) is expected to fluctuate and be in the range of 5,075pt – 5,200pt by support of stable USDIDR . Meanwhile, Friday last week (7/8) in Wall Street the DJIA ended higher by 47 points or 0.2% at 27,434pt , while the S&P500 and the Nasdaq gained and lost by 0.1% and 0.9%, respectively.
𝐈𝐧𝐝𝐨𝐧𝐞𝐬𝐢𝐚 𝐂𝐨𝐧𝐬𝐮𝐦𝐞𝐫 𝐒𝐞𝐜𝐭𝐨𝐫
𝐌𝐢𝐭𝐫𝐚 𝐀𝐝𝐢𝐩𝐞𝐫𝐤𝐚𝐬𝐚, 𝐛𝐞𝐢𝐧𝐠 𝐬𝐮𝐬𝐜𝐞𝐩𝐭𝐢𝐛𝐥𝐞 𝐭𝐨 𝐚𝐜𝐭𝐢𝐯𝐢𝐭𝐢𝐞𝐬’ 𝐢𝐧 𝐭𝐫𝐚𝐧𝐬𝐢𝐭𝐢𝐨𝐧 𝐫𝐞𝐜𝐨𝐯𝐞𝐫𝐲 𝐢𝐧𝐭𝐨 𝐧𝐨𝐫𝐦𝐚𝐥
* 𝐌𝐚𝐢𝐧𝐭𝐚𝐢𝐧 𝐨𝐮𝐫 𝐁𝐔𝐘 𝐜𝐚𝐥𝐥 𝐚𝐭 𝐚 𝟏𝟐-𝐌 𝐓𝐚𝐫𝐠𝐞𝐭 𝐏𝐫𝐢𝐜𝐞 𝐨𝐟 𝐈𝐃𝐑𝟗𝟎𝟎 𝐩𝐞𝐫 𝐬𝐡𝐚𝐫𝐞
* 𝐑𝐞𝐠𝐢𝐬𝐭𝐞𝐫𝐞𝐝 𝐨𝐩𝐞𝐫𝐚𝐭𝐢𝐧𝐠 𝐥𝐨𝐬𝐬 𝐝𝐮𝐫𝐢𝐧𝐠 𝐭𝐡𝐞 𝟏𝐇𝟐𝟎
* 𝐂𝐨𝐬𝐭-𝐜𝐮𝐭 𝐚𝐧𝐝 𝐢𝐧𝐭𝐞𝐧𝐬𝐢𝐟𝐲 𝐨𝐧 𝐨𝐧-𝐥𝐢𝐧𝐞 𝐩𝐥𝐚𝐭𝐟𝐨𝐫𝐦 𝐭𝐨 𝐭𝐡𝐫𝐞𝐚𝐝 𝐜𝐮𝐫𝐫𝐞𝐧𝐭 𝐩𝐚𝐧𝐝𝐞𝐦𝐢𝐜 𝐜𝐥𝐢𝐦𝐚𝐭𝐞
We maintain our BUY call of Mitra Adiperkasa (MAPI) by assumption of recovery to start in 2021. For this year, total net sales is estimated at IDR10.9tr with operating loss at IDR800bn. With business growth rates of 5% for the next 10 (ten) years being plugged-in to our DCF model with slightly lower profitability rates, we came up with equity value of IDR910 per share (WACC: 10.1%, LTG:2%).
Mitra Adiperkasa (MAPI) reported 1H20 sales at IDR6.8tr as compared to IDR10.0tr in 1H19, with 2Q20 total net sales amounted to IDR2.1tr as compared to IDR5.3tr. During the 2Q20 MAPI incurred operating loss at IDR492bn vs. operating profit of IDR239.2bn. MAPI, being a retail giant, clearly affected by the limited-down of the country in the 2Q20.
MAPI’s retail businesses cover the basic- necessity and basic-entertainment of Indonesia aspiring middle class with its popular clothes brand and cafes (please see our Report dated November 27, 2019). Over the last decade, the company has been successful to have improved business platform as well as process. End of June’s net gearing was at 17.9% vs. 1.1% end of last year.
2Q20 total net sales of MAPI contributed to around 6% of total Non car and non motorcycles sales and services in the economy (1Q20: 12%). This, among other, has made the company as one of the biggest sector movers, and is expected to be the soonest one to benefit from full scale activities recovery.
At the other end, yesterday the WTI price closed lower by 1.6% to USD41.3/barrel on demand worries. Meanwhile the USDIDR closed at IDR14.647 vs. IDR14.587 the previous one.
We advise the following recommendation , for both trading and longer-time investment purpose. 𝐀𝐀𝐋𝐈, 𝐋𝐒𝐈𝐏 (𝐬𝐞𝐜𝐭𝐨𝐫 𝐨𝐟 𝘈𝘨𝘳𝘪, 𝐚𝐥𝐥𝐨𝐜𝐚𝐭𝐢𝐨𝐧 𝐬𝐮𝐠𝐠𝐞𝐬𝐭𝐢𝐨𝐧 𝘜𝘯𝘥𝘦𝘳𝘸𝘦𝘪𝘨𝘩𝘵 ), 𝐔𝐍𝐓𝐑, 𝐈𝐓𝐌𝐆, 𝐀𝐃𝐑𝐎, 𝐏𝐓𝐁𝐀 (𝐬𝐞𝐜𝐭𝐨𝐫 𝐨𝐟 𝘊𝘰𝘢𝘭 𝘔𝘪𝘯𝘪𝘯𝘨, 𝐚𝐥𝐥𝐨𝐜𝐚𝐭𝐢𝐨𝐧 𝐬𝐮𝐠𝐠𝐞𝐬𝐭𝐢𝐨𝐧 𝘔𝘢𝘳𝘬𝘦𝘵-𝘸𝘦𝘪𝘨𝘩𝘵), 𝐆𝐆𝐑𝐌, 𝐔𝐍𝐕𝐑, 𝐈𝐂𝐁𝐏 (𝐬𝐞𝐜𝐭𝐨𝐫 𝐨𝐟 𝘊𝘰𝘯𝘴𝘶𝘮𝘦𝘳, 𝐚𝐥𝐥𝐨𝐜𝐚𝐭𝐢𝐨𝐧 𝐬𝐮𝐠𝐠𝐞𝐬𝐭𝐢𝐨𝐧 𝘖𝘷𝘦𝘳𝘸𝘦𝘪𝘨𝘩𝘵 ), 𝐀𝐒𝐈𝐈 (𝐬𝐞𝐜𝐭𝐨𝐫 𝐨𝐟 𝘈𝘶𝘵𝘰𝘮𝘢𝘵𝘪𝘷𝘦, 𝐚𝐥𝐥𝐨𝐜𝐚𝐭𝐢𝐨𝐧 𝐬𝐮𝐠𝐠𝐞𝐬𝐭𝐢𝐨𝐧 𝘔𝘢𝘳𝘬𝘦𝘵-𝘸𝘦𝘪𝘨𝘩𝘵), 𝐚𝐧𝐝 𝐀𝐂𝐄𝐒, 𝐒𝐂𝐌𝐀, 𝐌𝐀𝐏𝐈 (𝐬𝐞𝐜𝐭𝐨𝐫 𝐨𝐟 𝘛𝘳𝘢𝘥𝘦, 𝐚𝐥𝐥𝐨𝐜𝐚𝐭𝐢𝐨𝐧 𝐬𝐮𝐠𝐠𝐞𝐬𝐭𝐢𝐨𝐧 𝘖𝘷𝘦𝘳𝘸𝘦𝘪𝘨𝘩𝘵),𝐚𝐧𝐝 𝐓𝐊𝐈𝐌 (𝐬𝐞𝐜𝐭𝐨𝐫 𝐨𝐟 𝘉𝘢𝘴𝘪𝘤 𝘐𝘯𝘥𝘶𝘴𝘵𝘳𝘺, 𝐚𝐥𝐥𝐨𝐜𝐚𝐭𝐢𝐨𝐧 𝐬𝐮𝐠𝐠𝐞𝐬𝐭𝐢𝐨𝐧 𝘔𝘢𝘳𝘬𝘦𝘵-𝘸𝘦𝘪𝘨𝘩𝘵).
Cheers,