Logo Minnapadi
aboutusmpi.png
<< Back To Daily Report

Morning Dew 31 March 2020

FOCUS

ECONOMIC GROWTH MAY GROW SLOWER

Through the Indonesia Economic Report 2019, Bank Indonesia estimated Indonesia economic growth to decelerate at 4.2% - 4.6%, which is much lower than the previous estimate at 5.0% - 5.5% made early last year. Amid global pandemic issues that have resulted in various uncertainties, supply goods between countries for production and limited economic activities, the author noted, could slow down the economy. In addition, exports are forecast to contract by 5.2% - 5.6% in the wake of weak global economic growth, lower trade volume, and soft commodity price; as the commodities, whose demand mostly originates from China, may contribute heavily to the exports contraction. As a domino effect, lower exports may result in limited investment activities, estimated at a limited 3.1% - 3.5% of growth, slower than that of last year. Moreover, travel ban may also curb short-term investment, for example, as cited from CNBC, by limiting Chinese workers from coming to Indonesia, at the same time, investment from China will be hampered as well.

 

In 2020 public consumption is expected to decline as well, given a priority shift emphasized on basic needs instead of secondary or tertiary needs. The government spending, however, is estimated to grow by 2.1% - 2.5% for supporting purchasing power and maintaining business activities through accommodative fiscal policies.

 

JCI

On Monday trading session (3/30), JCI tumbled and ended its two-day rally last week, as the fear of economic recession caused by the Covid-19 pandemic outweighed various government stimuli. Index gave up -131.1 points (-2.88%) to 4,414.5, after once crossing the -5% threshold, causing the trading to be temporarily halted in the first session. Trading volume reached 4.72 billion shares with a total transaction value of Rp5.6 trillion. Foreign investors posted a net sell of Rp53.3 billion, compounding the year-to-date foreign net sell to Rp10 trillion.

 

All sectors fell, with miscellaneous industry (-5.47%), basic industry (-4.79%), and manufacturing (-4.35%) suffered the greatest losses. Stocks supporting the JCI were TLKM (+1.6%), MEGA (+4.0%), and POLL (+1.9%). In contrast, stocks weighing down the JCI were BBRI (-6.8%), BMRI (-6.9%), and UNVR (-5.5%).

 

U.S. NEWS  

U.S. stocks closed higher, led by healthcare shares as investors appeared to be more optimistic and focus on government efforts to slow down COVID-19. The DJIA was up 3.19%, at 22,327.48, the S&P 500 was up 3.35%, at 2,626.65 and the Nasdaq Composite was up 3.62%, at 7,774.15.

 

U.S. Treasury yields continue to fall, the benchmark 10-year notes rose 12/32 to yield 0.70%. Two-year notes were higher 2/32, yielding 0.243%. The 30-year notes rose 7/32, to yield 1.31%.

 

Oil prices continue to fall at 18-year low as the COVID-19 outbreak crushes demand and a price war between Saudi Arabia and Russia sets to flood the market with oil next month. Brent crude down -8.99%, to US$22.69/barrel and WTI crude slipped -5.76%, to US$21.65/barrel.

 

MACRO UPDATE

CHINA SLASH INTEREST RATE BY 20 BPS TO 2.20%

In order to provide economic stimulus to overcome the impact of COVID-19, The People's Bank of China (PBOC) on Monday, March 30, 2020, lowered the 7-Day Reverse Repo Rate by 20 bps from 2.40% to 2.20%. This interest rate cut was the third cut since November 2019 and the biggest slash in nearly five years. At the same time, PBOC also pumped 50 billion CNY into the money market trough 7-day reverse repo.

 

COMPANY UPDATE

REALIZATION OF TOTL NEW CONTRACT IN 1Q20 REACH Rp58.68 B

PT Total Bangun Persada Tbk. (TOTL) recorded the realization of new contracts in 1Q20 amounting to Rp58.68 billion. Until now, the company has not planned to make a target revision for 2020. Where previously the company targeted new contracts in 2020 to reach Rp3 trillion and revenue of Rp23.3 trillion.

 

COVID-19 HAMPERS WSBP'S EXPANSION

The pandemic of Covid-19 puts some hurdles on the operational and expansion plan of PT Waskita Beton Precast, Tbk. (WSBP). One of which is the ramping up of capacity in Bojanegara and Gasing plants and the development of new plants in Penajam, as some of the equipment is imported from China. In addition to that, the pandemic also causes the depletion of the supply of imported materials from other corona-impacted countries, and the postponement of ongoing projects.

 

SMAR REVISED THE PRINCIPAL OF ITS BOND

PT Sinarmas Agro Resources and Technology, Tbk. (SMAR) has revised its plan of issuing Sustainable Bond II SMART Phase I 2020 with Rp1 trillion principal value to Rp775 billion. The bond, which is part of Sustainable Offering (PUB) Phase II SMART with Rp3 trillion principal, consists of two series. Series A with Rp608.5 billion principal and coupon of 8.5% p.a. will be due in 3 years, whereas Series B with Rp166.5 billion principal and coupon of 9% p.a. has 5 years maturity. 67% (Rp519.25 billion) of the funds raised will be spent on capital expenditure in the form of technological development for SMART’s refinery, while the remaining 33% (Rp255.75 billion) is for increasing the capacity of biodiesel plants in Tarjun by 1,500 tonnes/day. Pefindo has affirmed a Single A Plus (idA+) rating for the bond.

 

SONA WILL CLOSE ITS STORES IN BALI

PT Sona Topas Tourism Industry Tbk (SONA)’s business is still under pressure due to COVID-19 spread. SONA’s subsidiary, Toko Bali Galleria, will close its stores from 28 March to April 2020. SONA also announced last February that the performance of its subsidiary, PT Inti Dufree Promosindo (IDP), declined because of the CoronaVirus outbreak.  

 

TLKM WILL DO “BUY BACK” AMOUNTING TO Rp1.5T

PT Telekomunikasi Indonesia Tbk (TLKM) will buy back its shares listed on the Indonesia Stock Exchange (IDX) amounting to Rp1,5T or will not exceed 20% of the paid-up capital in several stages (3 months) with the period from 30 Maret 2020 tp 29 Juni 2020.TLKM has appointed PT Bahana Sekuritas as securities trader. The buyback fund will be from retained earnings. As of september 2019 TLKM retained earnings was amounting to Rp91,26T and asset was amounting to Rp214,99T while net income recorded amounting to Rp16,46T. TLKM will carry out the buyback action because the trading fluctuations on the IDX since the beginning of 2020 are erratic. The Company’s share price at the friday trading (3/27) reached  Rp3.090/shares.

 

TECHNICAL OUTLOOK

JCI IS NEGATIVE, WITH EXPECTED RANGE OF 4,200 to 4,700.

JCI closed lower at 4,414 and changed its Resistance to 4,545/628/900, while the Support lay still at 3,920/845. Stochastic, MACD, and RSI still positive but indicate to turn into negative again. PSAR green dot already appears, while EMA 5, 20 & 50 still in a dead cross pattern.

 

ICBP

Support            8150

Resistance        11100

Target Price     10500

 

SIDO

Support            900

Resistance        1280

Target Price     1200

 

BBNI

Support            2700

Resistance        7900

Target Price     7100

 

BBTN

Support            660

Resistance        1930

Target Price     1800

 

WEGE

Support            107

Resistance        290

Target Price     240

 

DMAS

Support            102

Resistance        296

Target Price     246

 

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 31Th, 2020

Disclaimer

En Lorem Ipsum In Eiusmod.

EN HOME LOREM IPSUM EU NISI NISI LABORE ANIM REPREHENDERIT ADIPISICING SED LABORE QUIS UT TEMPOR ESSE QUIS CILLUM VENIAM CILLUM SUNT NISI CILLUM UT FUGIAT FUGIAT UT OFFICIA ET QUIS.

En Lorem ipsum Velit sit magna adipisicing laborum eu voluptate exercitation minim sit ex incididunt exercitation ut in sunt culpa quis magna sed dolor in et amet sunt id fugiat sint laboris sed officia est id officia eiusmod eu reprehenderit ullamco sed esse aliquip ex minim occaecat amet ad nulla voluptate do officia in reprehenderit quis officia dolore pariatur in quis consectetur ut nostrud aliqua sed officia fugiat nisi incididunt anim in laborum.

Lorem ipsum Dolor dolor dolore quis magna nulla aute ea sed velit id amet ut id minim proident cupidatat anim pariatur ex do dolore ut sit mollit ex voluptate consequat sit eu esse cillum exercitation eu dolore pariatur sunt et ut est Ut dolore id voluptate qui Ut in fugiat non exercitation Excepteur sunt magna ullamco sint do quis laboris dolore dolore pariatur laboris nulla mollit nisi laboris magna in aute Ut enim Excepteur est culpa in enim officia enim ea cillum fugiat dolore proident officia eiusmod pariatur in elit et aliquip esse culpa sint in fugiat aliquip cupidatat non id aliquip sit ad reprehenderit mollit dolor aliqua Duis in amet exercitation ut ut cillum et adipisicing qui aliqua.