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

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/bank-rakyat-indonesia-persero" target="_blank" data-smartkarma-citation="entities:484:1" rel="noopener">Bank Rakyat Indonesia (BBRI IJ)</a> have seen a significant correction on the back of concerns over credit quality, as provisions increased in 1Q2024, the bank addressed its problem micro-loans</li>
<li>The bank is addressing these loans with some further provisions likely over the coming quarter but special mention loans should plateau in July signifying a turn. </li>
<li>
<a href="https://www.smartkarma.com/entities/bank-rakyat-indonesia-persero" target="_blank" data-smartkarma-citation="entities:484:1" rel="noopener">Bank Rakyat Indonesia</a> will slow micro-lending and grow corporate loans this year to address the cost of credit. Profits will likely be flat and dividend payout up. Valuations are attractive.</li>
</ul>



Bank Rakyat Indonesia (BBRI IJ) have seen a significant correction on the back of concerns over credit quality, as provisions increased in 1Q2024, the bank addressed its problem micro-loans
The bank is addressing these loans with some further provisions likely over the coming quarter but special mention loans should plateau in July signifying a turn. 

Bank Rakyat Indonesia will slow micro-lending and grow corporate loans this year to address the cost of credit. Profits will likely be flat and dividend payout up. Valuations are attractive.


Bank Rakyat Indonesia (BBRI IJ) - Special Mention on the Turn

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.

<ul><li>BBRI reported 4M24 NP of Rp17.8tr (+4% yoy) with PPOP growth of 15% supported by higher other op. income and 12% loans growth.</li><li>Off 1Q24’s high base CoC of 3.7% (Feb24’s CoC was 6.7%), BBRI’s CoC improved to 3.3%. This should ease asset quality concerns.</li><li>The bank’s share price has declined by 28% since Mar24, bringing its PBV to slightly below mean and implied CoE to 11.1% (close to -2SD).</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.

BBRI reported 4M24 NP of Rp17.8tr (+4% yoy) with PPOP growth of 15% supported by higher other op. income and 12% loans growth.Off 1Q24’s high base CoC of 3.7% (Feb24’s CoC was 6.7%), BBRI’s CoC improved to 3.3%. This should ease asset quality concerns.The bank’s share price has declined by 28% since Mar24, bringing its PBV to slightly below mean and implied CoE to 11.1% (close to -2SD).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.

Bank Rakyat Indonesia (BBRI IJ) 4M24 Earnings Aided by Other Operating Income

<ul><li>Despite the 91% increase in provisions, BBRI booked 1Q24 net profit of Rp15.9tr in 1Q24 (+2% yoy) with strong PPOP growth of +22% yoy.</li><li>The mgmt raised CoC/NPL guidance to max 3.0% (from 2.2-2.3%) and to max 3.0% (from 2.7-2.9%), but with an expected improvement in 2H24.</li><li>Since Mar24, BBRI’s valuation has de-rated to 2.4x PBV (+0.5SD vs 5- year mean) as the shares fell 15%, underperforming the sector by 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.

Despite the 91% increase in provisions, BBRI booked 1Q24 net profit of Rp15.9tr in 1Q24 (+2% yoy) with strong PPOP growth of +22% yoy.The mgmt raised CoC/NPL guidance to max 3.0% (from 2.2-2.3%) and to max 3.0% (from 2.7-2.9%), but with an expected improvement in 2H24.Since Mar24, BBRI’s valuation has de-rated to 2.4x PBV (+0.5SD vs 5- year mean) as the shares fell 15%, underperforming the sector by 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.

Bank Rakyat Indonesia (BBRI IJ) Positive 1Q24 Net Profit Growth Despite Higher Provisions

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Event-Driven

Amman Mineral Internasional / Event-Driven

<ul>
<li>There is 1 constituent change for the LQ45 Index and 2 constituent changes for the IDX80 Index at the rebalance to be implemented at the close on 31 July.</li>
<li>The largest passive inflows are expected in <a href="https://www.smartkarma.com/entities/amman-mineral-internasional-pt" target="_blank" data-smartkarma-citation="entities:39838:1" rel="noopener">Amman Mineral Internasional (AMMN)</a>, <a href="https://www.smartkarma.com/entities/bank-rakyat-indonesia-persero" target="_blank" data-smartkarma-citation="entities:484:1" rel="noopener">Bank Rakyat Indonesia (BBRI)</a>, <a href="https://www.smartkarma.com/entities/bank-central-asia-tbk-pt" target="_blank" data-smartkarma-citation="entities:440:1" rel="noopener">Bank Central Asia (BBCA)</a>, <a href="https://www.smartkarma.com/entities/bank-mandiri-persero-tbk-pt" target="_blank" data-smartkarma-citation="entities:441:1" rel="noopener">Bank Mandiri Persero (BMRI)</a> and <a href="https://www.smartkarma.com/entities/jasa-marga-persero-tbk-pt" target="_blank" data-smartkarma-citation="entities:12747:1" rel="noopener">Jasa Marga (Persero) (JSMR)</a>. </li>
<li>The adds have moved higher over the recent past and are near their highs while the deletes have dropped over the last few years and are trading near their lows.</li>
</ul>


There is 1 constituent change for the LQ45 Index and 2 constituent changes for the IDX80 Index at the rebalance to be implemented at the close on 31 July.
The largest passive inflows are expected in Amman Mineral Internasional (AMMN), Bank Rakyat Indonesia (BBRI), Bank Central Asia (BBCA), Bank Mandiri Persero (BMRI) and Jasa Marga (Persero) (JSMR). 
The adds have moved higher over the recent past and are near their highs while the deletes have dropped over the last few years and are trading near their lows.


IDX30/​​LQ45/IDX80 Index Rebalance: Constituent, Float & Capping Changes

<ul><li>BBRI reported FY23 net profit of Rp60.1tr (+17% yoy, 102% of the cons.) on higher NII and lower opex, partly offset by higher provisions.</li><li>The bank provides guidance for stable loans growth, NIM, CIR, and DPO, and expects lower NPLs and CoC in FY24F.</li><li>BBRI trades at 2.5x FY24F PBV, +1SD to its 5-year avg., reflecting its robust performance and growth outlook.</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.

BBRI reported FY23 net profit of Rp60.1tr (+17% yoy, 102% of the cons.) on higher NII and lower opex, partly offset by higher provisions.The bank provides guidance for stable loans growth, NIM, CIR, and DPO, and expects lower NPLs and CoC in FY24F.BBRI trades at 2.5x FY24F PBV, +1SD to its 5-year avg., reflecting its robust performance and growth outlook.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.

Bank Rakyat Indonesia (BBRI IJ) - Robust 4Q23 Profit

Indonesia

PT Bank Rakyat Indonesia (Persero) Tbk provides commercial banking activities and its related services. The Bank also provides banking activities based on shariah principles.

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Bank Rakyat Indonesia (BBRI IJ)