External broker reports(aggregated public sources), BRI Danareksa Research

BRI Danareksa Research

External broker reports(aggregated public sources)

As a one-stop financial solution with the vision to be the most valuable securities house, BRI Danareksa Sekuritas (BRIDS) has maintained an excellent track record and extensive experience in the capital market as an underwriter, broker, and financial advisor for individual, institutional, foreign and domestic, private and government clients. Established in 1992, PT Danareksa Sekuritas is a securities company that performs activities as a securities broker, underwriter, or arranger and financial advisor.

Thematic (Sector/Industry)

<ul><li>Average coal prices YTD are below our expectations, driven by weak imports amid strong domestic production in China and India.</li><li>While current prices already near cost support levels, ST price rebound may be capped by weak imports as restocking only starts by end of 3Q.</li><li>We maintain a Neutral rating on the sector with preferences for UNTR&gt; ADRO&gt; AADI&gt; ITMG&gt; PTBA</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Average coal prices YTD are below our expectations, driven by weak imports amid strong domestic production in China and India.While current prices already near cost support levels, ST price rebound may be capped by weak imports as restocking only starts by end of 3Q.We maintain a Neutral rating on the sector with preferences for UNTR&gt; ADRO&gt; AADI&gt; ITMG&gt; PTBAContent is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Coal: Coal Price Downside May Be Limited, but Weak Demand May Cap ST Rebound (NEUTRAL)

Macroeconomics

<ul><li>Market review: JCI ended the week up 0.7% w-w, outperforming majority of EM peers.</li><li>Amid negative performances from the big sectors (Banks +0.5%, Telco -2.5% Consumer Staples -1.8% w-w), JCI’s positive return for the week was driven by Oil &amp; Gas (+10.6% w-w), Cement (+7.8% w-w) and Industrial Estate (+4.6% w-w).</li><li>In line with the majority of EM peers, foreign investors flow into JCI was a net positive (US$80mn), with mixed flows into large-cap banks (except for BBRI), TLKM, and metals (ANTM and BRMS). </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Market review: JCI ended the week up 0.7% w-w, outperforming majority of EM peers.Amid negative performances from the big sectors (Banks +0.5%, Telco -2.5% Consumer Staples -1.8% w-w), JCI’s positive return for the week was driven by Oil &amp; Gas (+10.6% w-w), Cement (+7.8% w-w) and Industrial Estate (+4.6% w-w).In line with the majority of EM peers, foreign investors flow into JCI was a net positive (US$80mn), with mixed flows into large-cap banks (except for BBRI), TLKM, and metals (ANTM and BRMS). Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

BRIDS Market Pulse: Chart of the Week – Telco Sector 5-Year EV/EBITDA

ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Cross Asset Strategy

<ul>
<li>The Indonesian market has seen a sharp sell-off with a confluence of concerns centred around the execution and implementation of government policy but the fall was mainly driven by retail.</li>
<li>The sell-off does not reflect an underlying deterioration of growth prospects for the economy or indeed earnings, although 4Q2024 results saw a slower performance for some sectors. </li>
<li>The government has already taken note and has determined to take action to reassure investors through policy measures. Valuations have already reached a historically attractive level.</li>
</ul>


The Indonesian market has seen a sharp sell-off with a confluence of concerns centred around the execution and implementation of government policy but the fall was mainly driven by retail.
The sell-off does not reflect an underlying deterioration of growth prospects for the economy or indeed earnings, although 4Q2024 results saw a slower performance for some sectors. 
The government has already taken note and has determined to take action to reassure investors through policy measures. Valuations have already reached a historically attractive level.


CrossASEAN Strategy - Indonesia's Delicate Balance

<ul><li>We continue to expect coal price to normalize and forecast Newcastle price at US$110/t in FY25, driven by growth in Indonesia’s export.</li><li>Amid the projected decline in coal prices, we forecast earnings for Indonesian coal miners to fall by 25-33% in FY25. </li><li>We cut the sector’s rating to Neutral; despite declining earnings, the sector continues to offer an attractive dividend yield (FY25 avg. 11%).</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

We continue to expect coal price to normalize and forecast Newcastle price at US$110/t in FY25, driven by growth in Indonesia’s export.Amid the projected decline in coal prices, we forecast earnings for Indonesian coal miners to fall by 25-33% in FY25. We cut the sector’s rating to Neutral; despite declining earnings, the sector continues to offer an attractive dividend yield (FY25 avg. 11%).Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Coal: Steady Dividend Stream to Cushion Normalizing Coal Price...

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International</a> recently released finely balanced set of FY2024 results, with weaker auto sales offset by stronger 2W and financial segment performance, with other segments also performing above expectations.</li>
<li>Financial services growth was driven by stronger multifinance growth, whilst the heavy equipment division saw stronger growth from mining contracting and gold offsetting slower growth from coal mining.</li>
<li>Astra continues investing in sustainable energy, nickel, and healthcare and looks for new opportunities. Valuations remain attractive on less than 6x forward PER and yield &gt; 8%. </li>
</ul>



Astra International recently released finely balanced set of FY2024 results, with weaker auto sales offset by stronger 2W and financial segment performance, with other segments also performing above expectations.
Financial services growth was driven by stronger multifinance growth, whilst the heavy equipment division saw stronger growth from mining contracting and gold offsetting slower growth from coal mining.
Astra continues investing in sustainable energy, nickel, and healthcare and looks for new opportunities. Valuations remain attractive on less than 6x forward PER and yield &gt; 8%. 


Astra International (ASII IJ) - Resilience in Motion

Indonesia

PT United Tractors Tbk distributes and leases construction machinery including Komatsu, Nissan Diesel, Scania, Bomag, Valmet, and Tadano brands.  The Company also provides contract mining services, and trades and assembles heavy equipment.

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United Tractors (UNTR IJ)

Coal: Coal Price Downside May Be Limited, but Weak Demand May Cap ST Rebound (NEUTRAL)

Average coal prices YTD are below our expectations, driven by weak imports amid strong domestic production in China and India.

BRI Danareksa Research

BRIDS Market Pulse: Chart of the Week – Telco Sector 5-Year EV/EBITDA

The week’s positive performance brought JCI to a 1.2% YTD increase, better than majority of ASEAN EM peers, while foreign investors were still at...

BRI Danareksa Research

CrossASEAN Strategy - Indonesia's Delicate Balance

The Indonesian market has seen a sharp sell-off with a confluence of concerns centred around the execution and implementation of government policy...

Angus Mackintosh

Coal: Steady Dividend Stream to Cushion Normalizing Coal Price...

We cut the sector’s rating to Neutral; despite declining earnings, the sector continues to offer an attractive dividend yield (FY25 avg. 11%).

BRI Danareksa Research

Astra International (ASII IJ) - Resilience in Motion

Astra International remains one of the best proxies for the Indonesian economy, with broad exposure through autos, finance, and heavy equipment and...

Angus Mackintosh

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