Indonesia Market Today - 16 February 2021

A. INDONESIA MORNING MARKET REVIEW

(Tue. 16 Feb 2021).

Global Market Highlight

US Indices was closed on Monday (15/02) due to Presidential`s day. Furthermore, the acquittal of former President Donald Trump on Saturday was proof that President Joe Biden is focusing on his work instead of seeking political revenge. As such, it hints at the USD1.9 trillion package getting through Congress faster and without dilution. Moreover, the market will look forward to several data releases today, such as: 1) US NY Empire State Manufacturing Index; 2) Eurozone GDP Growth Rate YoY 2nd Est; 3) Germany ZEW Economic Sentiment Index.

Domestic Update

• BPS recorded a surplus of USD1.96 billion in Indonesia`s trade balance for January 2021. This was caused by the value of exports which reached USD15.30 billion (+12.24% YoY), greater than imports of USD13.34 billion (-6,49% YoY) in the period of January 2021. The value in January 2021 was lower than that in December 2020 amounting to USD2.1 billion.

• Furthermore, there was an addition of 1,879 new Covid-19 cases in Jakarta yesterday.

IHSG Updates

JCI increased by +0.77% to 6,270.32 on Monday (15/02) followed by net foreign sell reaching IDR692.96 billion. The increase was supported by the surplus on the balance of trade as well as the strong catalyst from the car tax incentive which lift the automotive sector stocks. Meanwhile, the Rupiah exchange rate was strengthening at IDR13,910. We estimate JCI will move in the range of 6,158 – 6,287 while waiting for BI Interest Rate Decision.

B. INDONESIA CORPORATE NEWS

1. EXCL IJ

Posted a 3% increase in revenue for FY20 to Rp26.02 trillion. This increase was driven by data service revenue, which grew 10% YoY to IDR21.39 trillion. On the network side, FY20 data traffic increased 47% YoY to 4,869 Petabytes (vs 3,320 Petabytes FY19).

Earnings dropped by 47.85% YoY in FY20 due to a significant rise in depreciation cost by 69.60% YoY. Currently EXCL is trading at 8.90x/1.18x PE/PBV.

2. HRUM IJ

Targets an increase in coal production by around 25% of the FY20 production realization, which is under 3 million tons. In FY21E HRUM budgeted for capital expenditure of around USD7 million which came from internal cash and would be used for additional coal mining properties, purchase of heavy equipment and coal mining infrastructure, as well as maintenance of tugboats and barges.

HRUM`s target this year is inline with most of the companies growth estimation which we believe is achievable regarding the recovering demand. HRUM is currently trading at 37.11x/3.79x PE/PBV.

3. MDKA IJ

Continues exploration activities in three different areas in Indonesia (Tujuh Bukit in East Java, Wetar Island in Southwest Maluku, and Pani in Gorontalo) in January 2021. Exploration is focused on copper resources, while in regional Pani is focused on exploring gold resources. The total expenses incurred during January 2021 amounted to IDR29.7 billion.

We hope MDKA can sought more reserves in the future to increase their metal production and sales, as MDKA is the sole copper producers in Indonesia. MDKA is trading at 49.18x/6.90x PE/PBV.

C. STOCK WATCHLIST

AKRA, ISAT, POWR, APLN.

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