Indonesia Market Today - 14 December 2020

Monday (14/12/2020). After the JCI strengthened over the past week by + 1.98% but accompanied by a Net Sell of Foreign Investors of IDR1.74 trillion, at the beginning of this week it is necessary to be careful about being hit by profit taking as EIDO falls by -1.11%, falling oil prices -0.47% & Nickel - 0.36% * in line with the second wave of Covid19 in Europe * made several countries in Europe, such as Germany, begin to lock down again.

On the other hand, the return * of Coal`s price increase of + 3.19%, has the potential to be a catalyst to boost Coal-based stocks such as: * ADRO, PTBA, MBAP, ITMG, HRUM & UNTR *.

This time it is quite interesting to discuss the shares of PT Garuda Indonesia (GIAA) because it makes quite a lot of investors amazed, they are amazed to see the sharp increase in the stock where for 6 months it rose by 81.6% even for 3 months it rose sharply 77.34% amid the Covid19 pandemic. The impact has started many investors "over confidence" aka "forgetting themselves" about the financial performance of GIAA shares and thinking that GIAA shares will continue to "fly" until the seventh heaven.

A simple question, is it true that GIAA`s financial performance is so great following the sharp increase in its shares or is it just the "invisible hand" expertise to take advantage of the sentiment of PEN funds to distribute or book a net sell of their share position?

Let`s start looking at the latest financial data for LK Q2 / 2020 because until now GIAA has not submitted LK Q3 / 2020 even though 2020 will soon end up changing to 2021. A simple question is why GIAA is late in submitting LK? Even though LK is an important element in assessing the soundness of a company? Furthermore, if you look at LK Q2 / 2020, GIAA posted negative equity of US $ -88.12 million (or the equivalent of Rp.1.23 trillion assuming 1 US $ = Rp.14,000). The question is, is it feasible for a company to still operate with such a large deficit equity? Furthermore, until Q2 / 2020, GIAA posted a huge loss of US $ -712.73 million (equivalent to Rp -9,978 trillion). Maybe if the private company GIAA suffered such a big loss, it would have been "gasping" for life, but since GIAA is a state-owned company, it can still survive because the government bailed out with the placement of PEN funds amounting to Rp. 8.5 trillion. The simple question is, how long will the government bail out the GIAA? With such a large fund, it is certainly more useful for other purposes such as for education, building disadvantaged areas or building roads, dams or other infrastructure facilities. It doesn`t stop there, just look at the massive DER GIAA in Q2 / 2020 which reached -11765.83% or reached 117.65x. The simple question is, how many years it takes and how many passengers and goods are transported to generate super large revenue so that later having EBIT can cover principal and interest installments each year? Knowing simply the real financial condition of GIAA like that, would investors still dare to "enter" to buy GIAA shares? Especially if the "invisible hand" disappears later along with the disappearance of PEN funding sentiment.

B. INDONESIA CORPORATE NEWS

1. PT MNC Investama (BHIT)

The Company carried out PMTHMETD aka private placement on December 8, 2020. BHIT issued 5,998,697,900 new shares with a nominal value of Rp100 per share, at an exercise price of Rp100. Tempus Eternity Ltd and Scotts Capital Investment Corporation took part in the entire private placement. Thus, the total value taken is around Rp.599.6 billion. Tempus Eternity Ltd and Scotts Capital Investment Corporation are companies from the United States.

2. PT Bayan Resources (BYAN)

The company is optimistic that it can book coal sales of up to 30 million MT by the end of 2020, in line with the acquisition of 10.6 million MT of new contracts in the fourth quarter of 2020. With this target, the company estimates that it can earn as much as US $ 1.2 billion or equivalent to Rp 16.94 trillion, in line with the current average coal price of US $ 39 per MT. In 2021, BYAN is not eyeing higher sales and production volumes because the 100 km coal haul road to the Mahakam river is still under construction, however, until now the company has pocketed 66% of sales contracts of the total sales targeted in 2021. To smooth out the mining infrastructure, the company has prepared a capex of US $ 150 million.

3. PT Suparma (SPMA)

The company is optimistic that it will be able to achieve the sales target of Rp. 2.1 trillion (after experiencing 3 revisions) by the end of 2020 or a decrease of -16.33% compared to the realization in 2019 of Rp. 2.51 trillion. Meanwhile, the company is targeting net sales in 2021 of Rp. 2.6 trillion, up 23.8% from the 2020 target of Rp. 2.1 trillion. The projection of net sales, assuming an increase in sales quantity of 18.6% in 2021, and an increase in used capacity of 12.5% in 2021.

4. PT Impack Pratama Industri (IMPC)

The company will conduct PMTHMETD aka private placement, by releasing a maximum of 483.35 million with a nominal value of Rp10 per share. The funds that will be raised in this corporate action amount to IDR555 billion. The amount is obtained from the estimated price of a private placement of Rp1,149 per share. This is obtained from 90 percent of the company`s average share price during the 25 trading days prior to the listing date of new shares. The private placement is carried out within a span of two years from the approval of the EGMS Meeting on December 15, 2020. The proceeds from the private placement will be used for the settlement of Bond I Impack Pratam Indutsri 2016 series B amounting to IDR 100 billion, which will mature on December 2, 2021.

5. PT Soechi Lines (SOCI)

Moody`s Investors Service downgraded SOCI`s senior bond with a value of USD200 million which will mature in 2023 from B2 to B3 with a previously stable outlook with a negative outlook.

C. MARKET STATISTICS

*DJIA +47.11 +0.16% 30046*
NASDAQ -27.94 -0.23% 12377
*GOLD +6.10 +0.33% 1843.50*
OIL -0.22 -0.47% 46.56
*COAL (Jan`21/Newcastle) +2.55 +3.19% 82.50!!!*
NICKEL -62.50 -0.36% 17330
*TIN +80 +0.41% 19522.50*
*CPO (Jan`21) +9 +0.25% 3543*
EIDO -0.26 -1.11% 23.14
*TLK 22.96 (3233) vs 3280 (TLKM)*
*US 10yr -0.0150 -1.65% 0.8930*
*INDO 10yr -0.0355 -0.56% 6.3447*
*INDO CDS (5 yrs) +0.528 +0.760% 69.514*
*IDR (Spot) 14,080*

*IDX Range : 5,897 - 5,988*
*USD/IDR Range: 14,020 - 14,160*

D. STOCK WATHCLIST

BRIS, ANTM, MAPI, MEDC, ITMG, ISAT, BBCA, INCO, PWON, ACES

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