Indonesia Daily Market Insights: A Comprehensive Analysis
Published on December 2, 2024, by PT UOB Kay Hian Sekuritas
The Indonesian stock market scene has been abuzz with activity, and today’s report from PT UOB Kay Hian Sekuritas offers a deep dive into the financial performances and forecasts of key players. The insights provided cater to informed traders and investors eager to understand the market dynamics.
Bank Tabungan Negara (BBTN IJ): Navigating Through Challenges
Bank Tabungan Negara, a state-owned enterprise specializing in mortgage loans, has witnessed a challenging third quarter in 2024. The bank’s net profit dipped by 9.7% quarter-on-quarter and 30.9% year-on-year, leading to a 10% year-on-year decline for the first nine months, falling below market expectations. The decline was attributed to a 15.2% fall in non-interest income and an 18.8% rise in provision expenses.
The persistent high cost of funds (CoF), standing at 4.1%, put pressure on the Net Interest Margin (NIM), which dropped to 2.9% in the first nine months of 2024. The bank’s efforts to manage asset quality continue, with Loan at Risk (LaR) remaining high at 20.8%, though improved from 34.1% in 2020. The non-performing loan (NPL) ratio inched up to 3.2% as of September 2024.
Looking ahead, BBTN aims to bolster its earnings through the sale of Rp1.3 trillion to Rp1.5 trillion in bad assets by the fourth quarter of 2024. The bank is optimistic about a potential uptick in 2025 due to an expected increase in subsidized mortgage disbursements and lending rates. These positive catalysts are coupled with a strategic focus on expanding high-yield loan segments such as KRING, KAR, and KUR micro loans.
Operational expenses saw a significant increase of 17.2% year-on-year, primarily due to personnel and general administrative costs. Despite these hurdles, the bank maintains a “BUY” recommendation with a target price of Rp1,740, offering an upside of 35.4%.
Triputra Agro Persada (TAPG IJ): Technical Signals Point to Growth
Triputra Agro Persada is capturing attention with positive technical indicators suggesting potential growth. The stock closed higher, forming a bullish candlestick pattern, supported by an increase in trading volume. The Relative Strength Index (RSI) and Stochastic Oscillator both signal bullish trends, prompting a technical “BUY” recommendation.
Investors are advised to consider buying at Rp800, with a target price set at Rp870, indicating an 8.8% potential return. The resistance levels are identified at Rp840 and Rp880, while support is noted at Rp790 and Rp770. A stop-loss is recommended at Rp760 to manage risk. The approximate timeframe for this investment is 2-4 weeks.
Mitra Adiperkasa (MAPI IJ): Riding the Bullish Momentum
Mitra Adiperkasa’s stock has shown promising signs of strengthening, supported by rising trading volumes and the formation of a bullish long white candlestick pattern. The RSI indicator moving up in bullish territory and a bullish crossover in the Stochastic Oscillator further reinforce this positive outlook.
Technical analysts recommend a “BUY” at Rp1,550, targeting a price level of Rp1,660. This suggests a potential return of 7.0%. Resistance levels are pegged at Rp1,640 and Rp1,680, with support at Rp1,540 and Rp1,515. The stop-loss is strategically set at Rp1,510 to curtail potential downsides. The expected timeframe for this strategy is also 2-4 weeks.
Despite the technical optimism, it is important to note that the institutional research maintains a fundamental “HOLD” with a target price of Rp1,300, indicating a more cautious long-term perspective.
In conclusion, the Indonesian stock exchange reflects a mix of challenges and opportunities. Bank Tabungan Negara navigates through a tough financial landscape with strategic plans to enhance its future outlook. Meanwhile, Triputra Agro Persada and Mitra Adiperkasa exhibit technical signals of potential growth, offering intriguing prospects for investors. Stay tuned as the market evolves, presenting new opportunities for informed and strategic investments.
