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Morning Dew 17 March 2020

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SURGING FEBRUARY TRADE BALANCE

BPS recorded that Indonesia's trade balance in February 2020 increased by US$ 2.34B, or rose sharply when compared to the trade balance in January 2020 which experienced a deficit of US$ 0.64B.

 

This increase was mainly driven by the improved performance of non-oil and gas exports and the decline in non-oil and gas import performance. So,  it managed to record an increase in the non-oil and gas trade balance of US$ 3.27B, which has increased when compared to January 2020 which experienced a surplus of US$ 0.53B. Those non-oil and gas export hikes came from several commodities such as coal, CPO, and several manufactured products. This increase is also affected by declining non-oil and gas imports, especially for commodities of machinery and electrical equipment, partly as a result of the disruption of global supply chain disruptions due to COVID-19.

 

Meanwhile, the oil and gas trade balance deficit in February 2020 rose to US$ 0.93B, which increased compared to January 2020, which experienced a deficit of US$ 1.17B in the previous month. This decline was supported by the continued decline in oil and gas imports, particularly in the form of oil and gas products, amidst stable oil and gas exports supported by the positive performance of crude oil exports.

 

JCI

JCI on Monday trading session (3/16), JCI ended lower by -217 points (-4.42%) to 4,691. Transaction volume was recorded at 5.4 billion shares with Rp6.5T of trading value. Foreign investors posted a net buy of Rp238.1 billion, resulting in the year-to-date accumulation of foreign net sell of Rp7.5 trillion,

 

All sectors retreated, which were led by infrastructure (-5.98%), consumer goods (-5.67%), and manufacturing (-5.23%). Stocks supporting JCI  were NISP (+4.8%), EMTK (+3.0%), and RMBA (+4.0%). On the other hand, stocks weighing down JCI were BBRI (-5.9%), TLKM (-6.9%), and UNVR (-7.0%).

 

U.S. NEWS  

U.S. stocks plunged with DJIA experienced the worst selloff since 1987 after being temporarily halted for 15 minutes, amid rising fears that the Federal Reserve's surprise move to cut interest rates to near zero were instead interpreted by traders as a sign of desperation, a potential deep recession or at least, an indication that things are worse than they had thought. Moreover, investors jitters after Donald Trump warned the economic disruption from the virus could last until August and that the economy could fall into a recession. DJIA fell -12.93% to 20,188.52, the S&P 500 lost -11.98% to 2,386.13 and the Nasdaq dropped -12.32% to 6,904.59 

 

U.S. Treasury yields fell after Fed’s emergency actions. The benchmark 10-year notes were up 2-5/32, yielding 0.73%. The short-dated two-year notes were up 8/32, with a yield of 0.36% and the 30-year bonds rose 5-21/32, yielding 1.34%.

 

Oil prices fell below US$30/barrel to a four-year low. Brent crude fell -11.70%, to US$29.89/barrel and WTI crude plunged -9.27%, at US$28.79/barrel. 

 

COMPANY UPDATE

WSKT RECEIVED TOLL ROAD ELEVATED PAYMENT AMOUNTING TO Rp6.2T

PT Waskita Karya (Persero), Tbk (WSKT) has just received payment on Jakarta-Cikampek II Elevated toll road amounting to Rp6.2T, which represents 51% of total payment of Rp12.3T. The payment is allocated based on the proportion of joint operation between WSKT and PT Acset Indonusa, Tbk. (ACST). For additional information, in 2020, WSKT expects to receive another turnkey project payments amounting to Rp10T, which consists of the remaining payment of Jakarta-Cikampek Elevated II toll road, LRT Palembang, Terbanggi Besar - Pematang Panggang - Kayu Agung, and other toll road projects.

 

SKRN ACQUIRED EUR17.93 MILLION LOAN

PT Superkrane Mitra Utama, Tbk. (SKRN) has acquired a new loan from German bank, Landesbank Baden-Württemberg, worth EUR17.93 million (Rp296.56 billion) which will gradually be spent on buying new heavy machinery. SKRN will pay EURIBOR + 0.95% interest on the 20-month (March 2020 - January 2022) loan. In the first phase, the company is to receive EUR3.67 million (Rp60.5 billion) to buy three heavy machineries.

 

ADHI TO COUNT ON ALTERNATIVE SUPPLIES

Amidst the global pandemic of coronavirus (Covid-19), PT Adhi Karya, Tbk. (ADHI) will rely on alternative expedition routes related to the supply of project materials from abroad. Overall, however, the impact is estimated not to be significant. This year, ADHI targets FY20 new contracts acquisition could hit Rp32 trillion, whereas for 1Q20 is expected to reach Rp2.4 trillion. As of February, new contracts realization was Rp1.8 trillion (75% of 1Q20 target).

 

TDPM WILL OFFER NEW BOND

PT Tridomain Performance Materials Tbk (TDPM) will conduct  public offering Bond III - 2020 amounting to Rp400B. Pefindo gave an idA- rating for these bonds with a term of 3 year.  PT DBS Vickers Sekuritas Indonesia will be the underwriter. The offering period will be conducted from March 16 to March 20, 2020.

 

BRPT WILL ISSUE A NEW BOND

PT Barito Pacific Tbk (BRPT) will issue a bond amounting to Rp750B with interest rate 8.6% and 9.1%. This fund will be used for the Company's debt amounting to US$200M (Single Currency Term Facility). BRPT will issue Sustainable Bonds Barito Pacific I Phase II - 2020 guaranteed in full commitment amounting to Rp352.48B. It is divided into two series: Series A amounting to Rp217.48B (8.6%/annum) for 3 years & Series B amounting to Rp135B (9.1%) for 5 years. The coupon payment will be paid every three months: the first coupon payments will be July 1, 2020. For the last interest payment will be on April 1, 2023 (seri A) and on April 1, 2025 (seri B). The remaining bond principal (Rp397.52B) will be guaranteed in the best effort. This Bonds received a SIngle A rating for the period from 9 October 2019 - 1 October 2020.

 

TECHNICAL OUTLOOK

JCI IS NEGATIVE, WITH EXPECTED RANGE OF 4,560 to 5,020.

JCI was closed lower at 4,691 breaching the nearest Support at 4,790, so the next Support lays at 4,640/560 while the Resistance hanging still at 5,020/130. PSAR red dot still appeared along with EMA 5, 20&50 still in dead cross pattern. MACD, RSI, and Stochastic still negative along with the Candlestick breached the lower Bbline.

Hence, our JCI still negative from technical analyst outlook and coupled by negative foreign sentiment.

 

ACES

Support            1440

Resistance        1890

Target Price      1800

 

DISCLAIMER

This research report is prepared by PT MINNA PADI INVESTAMA SEKURITAS Tbk. for information purposes only and is not to be used or considered as an offer or the solicitation of an offer to sell or to buy or subscribe for securities or other financial instruments. The report has been prepared without regard to individual financial circumstance, need or objective of person to receive it. The securities discussed in this report may not be suitable for all investors. The appropriateness of any particular investment or strategy whether opined on or referred to in this report or otherwise will depend on an investor’s individual circumstance and objective and should be independently evaluated and confirmed by such investor, and, if appropriate, with his professional advisers independently before adoption or implementation (either as is or varied).

Tue March 17Th, 2020

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