Indonesia Morning Market - 25 Aug 2020
A. INDONESIA MORNING MARKET REVIEW
Tuesday (25/08/2020). (DJIA`s strengthening sentiment of + 1.35% combined with the strengthening of EIDO by + 1.33% and strengthening of several commodity prices such as Nickel + 1.03% & Oil + 0.33% * has the potential to push up the JCI * in trading this Tuesday amid the achievement of the highest number of infected victims and died due to Corvid19, where on Monday there was an increase of around +1,877 people (up + 1.22%) infected with Corvid * so that so far the victims infected by Corvid19 have reached 155,412 people with the addition of deaths on Monday of +79 people (up + 1.18%) so far The death toll has reached 6,759, leading to 7,000 dead in the near future (Fatality Rate of 4.35%) *.
B. INDONESIA CORPORATE NEWS
1. PT Astra Internasional (ASII)
The impact of the COVID-19 pandemic, especially in the second quarter, has had a substantial impact on the Group`s operations, including the temporary closure of automotive manufacturing and distribution activities, as well as a significant increase in the amount of loans restructured in the Group`s financial services business. In addition, lower coal prices put pressure on the heavy equipment, mining contracting and mining businesses. This pandemic, and the steps being taken to contain its impact, are expected to continue to impact performance into the end of the year. In the second quarter of 2020, net profit attributable to shareholders of PT Astra International Tbk from each business segment. Net profit from the Group`s automotive division decreased 79% to Rp716 billion, mainly due to a significant drop in sales volume in the second quarter. Net income from the Group`s financial services business decreased 25% to Rp2.1 trillion during the first half of 2020, mainly due to increased provisions to cover increased non-performing loan losses in the consumer and heavy equipment financing businesses. Net income for the Group from the heavy equipment, mining, construction and energy divisions decreased by 29% to Rp2.4 trillion, mainly due to lower heavy equipment sales and contract mining volume, due to weaker coal prices. Net income from the Group`s Agribusiness division reached IDR312 billion, a significant increase compared to net income in the first half of 2019, due to higher palm oil prices. The Group`s infrastructure and logistics division recorded a net loss of IDR 88 billion, compared to a net profit of IDR 83 billion in semester 1/2019, mainly due to a decrease in toll road revenue. Net income from the Group`s information technology segment decreased 64% to Rp16 billion, mainly due to lower revenues from the document solutions and office services business of PT Astra Graphia (ASGR), which 76.9% of the shares are owned by the Company.
2. PT Semen Baturaja (SMBR)
To improve sales performance in order to achieve the target in the second semester of 2020, by increasing sales of its newest product variants such as Mortar and White Clay. Baturaja Mortar comes with 5 (five) variants, namely Mortar Acian, Lightweight Brick Pair, Ceramic Adhesives, Brick & Plastering and White Acian. SMBR has prepared two production units with a capacity of 1.5 and 6 tons per day (tpd) located in Panjang Factory, Lampung to supply Mortar. In addition to supporting the sales of White Clay products, which contribute significantly to SMBR`s performance, the Company has also developed a White Clay production facility to meet the 50,000 ton target in accordance with the White Clay sales contract signed by SMBR with Pusri, a subsidiary of Pupuk Indonesia. . During Semester I / 2020, sales of White Clay reached 15,828 tons or 7% higher than the target set in that period. The company pending the realization of the Capex budgeted by the company throughout 2020, except for those that really need to be done such as land acquisition for limestone mining which is budgeted at IDR 64 billion in 2020 and investment in mortar with a budget of IDR 800 million. SMBR through its subsidiary Baturaja Multi Usaha (BMU) has also penetrated the Lightweight Brick business while preparing other derivative products such as Fiber Cement Board (FCB) and Porous Concrete which are currently still in the testing phase. Throughout Semester I / 2020, SMBR has recorded a cement sales volume of 746,612 tonnes or 84% compared to the same period last year. This sales volume achievement is quite good considering the impact of the Covid-19 pandemic which has caused a significant decline in cement demand in almost all areas of the Company.
2. PT Dharma Satya Nusantara (DSNG)
The company has completed a Bio-Compressed Natural Gas (Bio-CNG) factory with a capacity of 280 m3 per hour and produces an electricity output of 1.2 Megawatts, which is located in Muara Wahau, East Kutai Regency, East Kalimantan Province. By utilizing palm oil mill effluent (POME) which contains methane gas (CH4), the Company can reduce greenhouse gas emissions which have a negative impact on the environment. In addition, through the process of converting methane gas into electricity and liquid gas in tubes or Bio-Compressed Natural Gas (Bio-CNG), the use of POME from 1 Palm Oil Mill (PKS) with a capacity of 60 tons of FFB per hour, will save the use of diesel up to 2 million liters per year as a substitute for diesel fuel in PKS, employee housing and transportation facilities. Next year, the Company plans to build the next Bio-CNG plant with a much larger capacity because it utilizes POME from 2 PKS with a capacity of 2 × 60 tons of FFB per hour, thus saving energy costs will be even more significant. In addition, with the use of Bio-CNG, the shell or Palm Kernel Shell, which was previously used as fuel at the Kernel Crushing Plant (KCP), can be processed into biomass for export to Japan, thereby generating additional revenue for the Company.
3. PT Pembangunan Jaya Ancol (PJAA)
During semester 1/2020, the company`s operating income decreased by -58% or from Rp. 607,899 billion in the first semester of 2019 to Rp. 254,215 billion in the first semester of 2020. Meanwhile, the company`s net profit also fell -306%. In the first half of this year, the company observed a loss of Rp 146.379 billion compared to the same period the previous year, a profit of Rp 71.225 billion.
C. MARKET STATISTICS
*DJIA +378.1 +1.35% 28308*
*NASDAQ +67.9 +0.60% 11380*
GOLD -11.3 -0.58% 1936.10
*OIL +0.14 +0.33% 42.39*
COAL (Sep/Newcastle) -0.75 -1.51% 48.85
*NICKEL +152.5 +1.03% 14910*
TIN -225 -1.26% 17367.5
CPO (Sep`) -37 -1.31% 2794
*EIDO +0.26 +1.33% 19.75*
US 10yr +0.006 +0.94% 0.6460
INDO 10yr -0.0035 -0.05% 6.9180
*INDO CDS (5yr) -3.427 -3.35% 98.89*
*TLK 40.30 (2956) vs 3000 (TLKM)*
IDR (Spot) 14,670
IDR (Bloomberg, 25/08/20/Fut, 04.55) 14,670
*IDX Range : 5,239 - 5,324*
*USD/IDR Range: 14,600 - 14,735*
D. STOCK WATCHLIST
SMRA, INDF, RALS, AKRA, CTRA, MAPI, BBRI, SMGR, ICBP, GGRM.
GFS ASIA TEAM
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