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

<div class="content-highlight">
The week that was in <a href="mailto:ASEAN@Smartkarma" target="_blank" rel="noopener">ASEAN@Smartkarma</a> is filled with another eclectic mix of differentiated, substantive, and actionable insights from across South East Asia and includes macro, top-down and thematic pieces, as well as actionable equity bottom-up and credit insights over the past week.
We add below a NEW section, which includes emerging themes in ASEAN and selects important news flow or developments for commentary, which may impact SE Asian companies and markets.  
</div>
<h3>Equity Bottom-Up Insights</h3>
In Indonesia<a href="https://www.smartkarma.com/insights/bank-mandiri-persero-bmri-ij-a-plethora-of-good-news" target="_blank" rel="noopener"> Bank Mandiri Persero (BMRI IJ) - A Plethora of Good News</a>,  Cross-ASEAN insight provider<a href="https://www.smartkarma.com/profiles/angus-mackintosh" target="_blank" rel="noopener"> Angus Mackintosh</a> reports back a call with<a href="https://www.smartkarma.com/entities/bank-mandiri-persero-tbk-pt" target="_blank" rel="noopener"> Bank Mandiri Persero (BMRI IJ)</a> revealed a relatively positive message on a number of fronts, which came as a rare positive surprise. 
In<a href="https://www.smartkarma.com/insights/bank-mandiri-persero-bmri-ij-the-unsung-hero-of-syariah" target="_blank" rel="noopener"> Bank Mandiri Persero (BMRI IJ) - The Unsung Hero of Syariah?</a> , Cross-ASEAN Insight provider<a href="https://www.smartkarma.com/profiles/angus-mackintosh" target="_blank" rel="noopener"> Angus Mackintosh</a> sees potential positive catalysts in the merger of three State-owned Syariah banks. He believes that Mandiri Syariah,  given it has the largest Syariah business and generating an ROE in excess of 15%, will take the lead in the merged entity. 
In<a href="https://www.smartkarma.com/insights/metrodata-electronic-mtdl-ij-a-rare-value-play-on-indonesia-s-digitalization" target="_blank" rel="noopener"> Metrodata Electronic (MTDL IJ) - A Rare Value Play on Indonesia's Digitalization</a>,<a href="https://www.smartkarma.com/profiles/angus-mackintosh" target="_blank" rel="noopener"> Angus Mackintosh</a> highlights why<a href="https://www.smartkarma.com/entities/metrodata-electronic-pt" target="_blank" rel="noopener"> Metrodata Electronic (MTDL IJ)</a> looks undervalued, as it benefits not only from offline companies continuing to digitalize processes and infrastructure but also from the rise in e-commerce, digital payments, fintech, and gaming. 
In<a href="https://www.smartkarma.com/insights/xl-axiata-excl-ij-enabling-and-converging-in-indonesia" target="_blank" rel="noopener"> XL Axiata (EXCL IJ) - Enabling and Converging in Indonesia</a>,<a href="https://www.smartkarma.com/profiles/angus-mackintosh" target="_blank" rel="noopener"> Angus Mackintosh</a> revisits<a href="https://www.smartkarma.com/entities/xl-axiata-tbk-pt" target="_blank" rel="noopener"> XL Axiata (EXCL IJ),</a> one of the key enablers of the Indonesian digital economy, with around 90% of revenues coming from data and 75% of its subscriber base on 4G. Smartkarma hosted a Webinar with <a href="https://www.smartkarma.com/entities/xl-axiata-tbk-pt" target="_blank" data-smartkarma-citation="entities:15028:1" rel="noopener">XL Axiata (EXCL IJ)</a> last week, which revealed a positive long-term picture, despite some near term competitive headwinds. 
In <a href="https://www.smartkarma.com/insights/sunpower-read-across-from-buyout-of-zheneng-jinjiang-fair-value-remains-at-1-sgd-63-upside" target="_blank" data-smartkarma-citation="insights:44133" rel="noopener">Sunpower: Read Across from Buyout of Zheneng JinJiang; Fair Value Remains at 1 SGD (63% Upside),</a> CrossASEAN Insight Provider provider <a href="https://www.smartkarma.com/profiles/nicolas-van-broekhoven-24a66c2d-bca4-4f5b-adda-c4e2bcc509f4" target="_blank" data-smartkarma-citation="accounts:1208" rel="noopener">Nicolas Van Broekhoven</a> revisits <a href="https://www.smartkarma.com/entities/sunpower-group-ltd" target="_blank" data-smartkarma-citation="entities:18395:1" rel="noopener">Sunpower Group (SPWG SP)</a> post a Smartakarma webinar with the company. 
In Thailand<a href="https://www.smartkarma.com/insights/ipo-radar-nforce-secure-new-player-in-thai-cyber-security" target="_blank" rel="noopener"> IPO Radar: NForce Secure, New Player in Thai Cyber Security</a>, Thai Specialist<a href="https://www.smartkarma.com/profiles/athaporn-arayasantiparb-cfa" target="_blank" rel="noopener"> Athaporn Arayasantiparb, CFA</a> takes a look at NForce Secure, New Player in Thai Cyber Security.  
In <a href="https://www.smartkarma.com/insights/wilmar-is-a-buy-after-yka-s-listing" target="_blank" data-smartkarma-citation="insights:44228" rel="noopener">Wilmar Is A Buy After YKA’s Listing,</a><a href="https://www.smartkarma.com/profiles/david-blennerhassett" target="_blank" data-smartkarma-citation="accounts:840" rel="noopener">David Blennerhassett</a> revisits <a href="https://www.smartkarma.com/entities/wilmar-international-ltd" target="_blank" data-smartkarma-citation="entities:172:1" rel="noopener">Wilmar International (WIL SP)</a> following the successful listing of <a href="https://www.smartkarma.com/entities/yihai-kerry-arawana-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:29184:1" rel="noopener">Yihai Kerry Arawana Holdings Co Ltd (YKA CH).</a>
In Singapore<a href="https://www.smartkarma.com/insights/sgx-sgx-sp-market-under-rates-its-growth-potential" target="_blank" rel="noopener"> SGX (SGX SP): Market Under-Rates Its Growth Potential</a>,<a href="https://www.smartkarma.com/profiles/victor-galliano" target="_blank" rel="noopener"> Victor Galliano</a> discusses why he feels<a href="https://www.smartkarma.com/entities/singapore-exchange-ltd" target="_blank" rel="noopener"> SGX (SGX SP)</a> is undervalued. 
In <a href="https://www.smartkarma.com/insights/business-dna-suksan-yasasin-of-chayo-group" target="_blank" data-smartkarma-citation="insights:44242" rel="noopener">Business DNA: Suksan Yasasin of Chayo Group,</a><a href="https://www.smartkarma.com/profiles/dr-andrew-stotz-cfa" target="_blank" data-smartkarma-citation="accounts:756" rel="noopener">Dr. Andrew Stotz, CFA</a> conducts an interview with Suksan Yasasin, the CEO of Chayo Group. Business DNA is a chance to dig into the essential makeup of business leaders and their organizations. The focus is not on the short term but rather on understanding the driving forces of a business. 
In <a href="https://www.smartkarma.com/insights/ori-expect-flat-3q20-earnings-but-strong-recovery-in-4q20" target="_blank" data-smartkarma-citation="insights:44163" rel="noopener">ORI: Expect Flat 3Q20 Earnings but Strong Recovery in 4Q20,</a> our friends at <a href="https://www.smartkarma.com/companies/country-group" target="_blank" data-smartkarma-citation="companies:965" rel="noopener">Country Group</a> revisit <a href="https://www.smartkarma.com/entities/origin-property-pcl" target="_blank" data-smartkarma-citation="entities:26762:1" rel="noopener">Origin Property (ORI TB)</a> ahead of the company's earnings. 
In <a href="https://www.smartkarma.com/insights/com7-upgrade-super-cycle-for-iphone-users" target="_blank" data-smartkarma-citation="insights:44208" rel="noopener">COM7: Upgrade Super Cycle for iPhone Users,</a> <a href="https://www.smartkarma.com/companies/country-group" target="_blank" data-smartkarma-citation="companies:965" rel="noopener">Country Group</a> revisits this electronics distributor in light of the announcement of the launch of the new iPhone 12. 
<h3>Sector and Thematic Insights</h3>
In <a href="https://www.smartkarma.com/insights/snippets-45-lobster-alliance-cp-all-goes-to-laos" target="_blank" data-smartkarma-citation="insights:42866" rel="noopener">Snippets #45: Lobster Alliance, CP All Goes to Laos,</a> our Thai guru <a href="https://www.smartkarma.com/profiles/athaporn-arayasantiparb-cfa" target="_blank" data-smartkarma-citation="accounts:766" rel="noopener">Athaporn Arayasantiparb, CFA</a> highlights five developments over the past week that may impact Thai equities.
In <a href="https://www.smartkarma.com/insights/sti-index-rebalance-kdcreit-included-flt-misses-out" target="_blank" data-smartkarma-citation="insights:44178" rel="noopener">STI Index Rebalance: KDCREIT Included, FLT Misses Out,</a> <a href="https://www.smartkarma.com/profiles/brian-freitas" target="_blank" data-smartkarma-citation="accounts:4091" rel="noopener">Brian Freitas</a> comments on the recent FTSE STI Index rebalance.  
In<a href="https://www.smartkarma.com/insights/msci-nov20-index-rebalance-preview-asean-em-edition" target="_blank" rel="noopener"> MSCI Nov20 Index Rebalance Preview - ASEAN EM Edition</a>,<a href="https://www.smartkarma.com/profiles/brian-freitas" target="_blank" rel="noopener"> Brian Freitas</a> looks at the upcoming MSCI ASEAN EM scheduled rebalancing. 
<h3>Credit Insights</h3>
In <a href="https://www.smartkarma.com/insights/kasikornbank-s-inaugural-at1-underweight-on-franchise-challenges-and-valuation" target="_blank" data-smartkarma-citation="insights:44176" rel="noopener">Kasikornbank’s Inaugural AT1 – Underweight on Franchise Challenges and Valuation,</a> credit specialist <a href="https://www.smartkarma.com/profiles/hank-calenti-cfa" target="_blank" data-smartkarma-citation="accounts:5194" rel="noopener">Hank Calenti, CFA</a> comments on <a href="https://www.smartkarma.com/entities/kasikornbank-pcl" target="_blank" data-smartkarma-citation="entities:293:1" rel="noopener">Kasikornbank PCL (KBANK TB)</a>'s inaugural AT1 bond. He suggests to Underweight <a href="https://www.smartkarma.com/entities/kasikornbank-pcl" target="_blank" data-smartkarma-citation="entities:293:1" rel="noopener">Kasikornbank's (KBANK)</a> inaugural Additional Tier 1 (AT1) bond on franchise challenges and valuation.


The week that was in ASEAN@Smartkarma is filled with another eclectic mix of differentiated, substantive, and actionable insights from across South East Asia and includes macro, top-down and thematic pieces, as well as actionable equity bottom-up and credit insights over the past week.
We add below a NEW section, which includes emerging themes in ASEAN and selects important news flow or developments for commentary, which may impact SE Asian companies and markets.  

Equity Bottom-Up Insights
In Indonesia Bank Mandiri Persero (BMRI IJ) - A Plethora of Good News,  Cross-ASEAN insight provider Angus Mackintosh reports back a call with Bank Mandiri Persero (BMRI IJ) revealed a relatively positive message on a number of fronts, which came as a rare positive surprise. 
In Bank Mandiri Persero (BMRI IJ) - The Unsung Hero of Syariah? , Cross-ASEAN Insight provider Angus Mackintosh sees potential positive catalysts in the merger of three State-owned Syariah banks. He believes that Mandiri Syariah,  given it has the largest Syariah business and generating an ROE in excess of 15%, will take the lead in the merged entity. 
In Metrodata Electronic (MTDL IJ) - A Rare Value Play on Indonesia's Digitalization, Angus Mackintosh highlights why Metrodata Electronic (MTDL IJ) looks undervalued, as it benefits not only from offline companies continuing to digitalize processes and infrastructure but also from the rise in e-commerce, digital payments, fintech, and gaming. 
In XL Axiata (EXCL IJ) - Enabling and Converging in Indonesia, Angus Mackintosh revisits XL Axiata (EXCL IJ), one of the key enablers of the Indonesian digital economy, with around 90% of revenues coming from data and 75% of its subscriber base on 4G. Smartkarma hosted a Webinar with XL Axiata (EXCL IJ) last week, which revealed a positive long-term picture, despite some near term competitive headwinds. 
In Sunpower: Read Across from Buyout of Zheneng JinJiang; Fair Value Remains at 1 SGD (63% Upside), CrossASEAN Insight Provider provider Nicolas Van Broekhoven revisits Sunpower Group (SPWG SP) post a Smartakarma webinar with the company. 
In Thailand IPO Radar: NForce Secure, New Player in Thai Cyber Security, Thai Specialist Athaporn Arayasantiparb, CFA takes a look at NForce Secure, New Player in Thai Cyber Security.  
In Wilmar Is A Buy After YKA’s Listing,David Blennerhassett revisits Wilmar International (WIL SP) following the successful listing of Yihai Kerry Arawana Holdings Co Ltd (YKA CH).
In Singapore SGX (SGX SP): Market Under-Rates Its Growth Potential, Victor Galliano discusses why he feels SGX (SGX SP) is undervalued. 
In Business DNA: Suksan Yasasin of Chayo Group,Dr. Andrew Stotz, CFA conducts an interview with Suksan Yasasin, the CEO of Chayo Group. Business DNA is a chance to dig into the essential makeup of business leaders and their organizations. The focus is not on the short term but rather on understanding the driving forces of a business. 
In ORI: Expect Flat 3Q20 Earnings but Strong Recovery in 4Q20, our friends at Country Group revisit Origin Property (ORI TB) ahead of the company's earnings. 
In COM7: Upgrade Super Cycle for iPhone Users, Country Group revisits this electronics distributor in light of the announcement of the launch of the new iPhone 12. 
Sector and Thematic Insights
In Snippets #45: Lobster Alliance, CP All Goes to Laos, our Thai guru Athaporn Arayasantiparb, CFA highlights five developments over the past week that may impact Thai equities.
In STI Index Rebalance: KDCREIT Included, FLT Misses Out, Brian Freitas comments on the recent FTSE STI Index rebalance.  
In MSCI Nov20 Index Rebalance Preview - ASEAN EM Edition, Brian Freitas looks at the upcoming MSCI ASEAN EM scheduled rebalancing. 
Credit Insights
In Kasikornbank’s Inaugural AT1 – Underweight on Franchise Challenges and Valuation, credit specialist Hank Calenti, CFA comments on Kasikornbank PCL (KBANK TB)'s inaugural AT1 bond. He suggests to Underweight Kasikornbank's (KBANK) inaugural Additional Tier 1 (AT1) bond on franchise challenges and valuation. 

The NEW Week that Was in ASEAN@Smartkarma - Syariah Banking, XL Axiata, and Telkom's Tower Spinoff

Equity Bottom-Up

PT Metrodata Electronics / Equity Bottom-Up

<div class="content-highlight">
<a href="https://www.smartkarma.com/entities/metrodata-electronic-pt" target="_blank" data-smartkarma-citation="entities:7184:1" rel="noopener">Metrodata Electronic (MTDL IJ)</a> is a rare value play on Indonesia's digitalization. It benefits not only from offline companies continuing to digitalize processes and infrastructure but also from the rise in e-commerce, digital payments, fintech, and gaming. 
</div>
It is one of the leading Information and Communication Technology (ICT) distribution companies in Indonesia, with strategic alliances with world-class ICT companies, distributing for around 75% of global IT brands to consumer and commercial customers. 
The real driver for growth and profits for the company is coming from the company's solutions and consulting business, where it holds around 20% market share in Indonesia and this is a growing portion of sales and more importantly profits.
The company operates out of one distribution center but has a total of 20 warehouses across Indonesia, covering 150+ cities, with 4,000+ channel partners. 
With the boom in e-commerce, growing at an unprecedented rate globally, with younger and older generations now shopping and using other online services, there is an even greater need for the products that <a href="https://www.smartkarma.com/entities/metrodata-electronic-pt" target="_blank" data-smartkarma-citation="entities:7184:1" rel="noopener">Metrodata Electronic (MTDL IJ)</a> distributes.
E-commerce operators continue to drive strong demand for the company's products in order to support their own rapid growth, with increasing needs for IT infrastructure, as well as solutions and consulting services.
Offline companies are also increasingly adopting and embracing the concept of the digital transformation of Industry 4.0. This is a mixture of cloud computing, artificial intelligence (AI), machine learning, and advanced analytics that are designed to improve management, business operations, and customer reach by making processes simpler and more accessible than before. 
The company has seen some benefit from COVID-19 as there is little doubt that with companies are obligated to implement WFH procedures, the requirement for a solid IT infrastructure and digital tools are all the more essential.
<a href="https://www.smartkarma.com/entities/metrodata-electronic-pt" target="_blank" data-smartkarma-citation="entities:7184:1" rel="noopener">Metrodata Electronic (MTDL IJ)</a> has a long track record of sales and profits over the last few years and has also gradually improved margins at the same time. Being a distribution company, net margins remain relatively low at 2.5% but its move towards more consulting and solutions work will help to support and improve margins going forward. 
Valuations look attractive with the company trading on 8.7x FY21E PER, with forecast growth of +15% and +17% over FY21E and FY22E respectively, assuming flat net margins of 2.5%. Its international peers trade on an average of around 16x FY21 PER, which suggests <a href="https://www.smartkarma.com/entities/metrodata-electronic-pt" target="_blank" data-smartkarma-citation="entities:7184:1" rel="noopener">Metrodata Electronic (MTDL IJ)</a> is undervalued, especially given a positive earnings outlook.


Metrodata Electronic (MTDL IJ) is a rare value play on Indonesia's digitalization. It benefits not only from offline companies continuing to digitalize processes and infrastructure but also from the rise in e-commerce, digital payments, fintech, and gaming. 

It is one of the leading Information and Communication Technology (ICT) distribution companies in Indonesia, with strategic alliances with world-class ICT companies, distributing for around 75% of global IT brands to consumer and commercial customers. 
The real driver for growth and profits for the company is coming from the company's solutions and consulting business, where it holds around 20% market share in Indonesia and this is a growing portion of sales and more importantly profits.
The company operates out of one distribution center but has a total of 20 warehouses across Indonesia, covering 150+ cities, with 4,000+ channel partners. 
With the boom in e-commerce, growing at an unprecedented rate globally, with younger and older generations now shopping and using other online services, there is an even greater need for the products that Metrodata Electronic (MTDL IJ) distributes.
E-commerce operators continue to drive strong demand for the company's products in order to support their own rapid growth, with increasing needs for IT infrastructure, as well as solutions and consulting services.
Offline companies are also increasingly adopting and embracing the concept of the digital transformation of Industry 4.0. This is a mixture of cloud computing, artificial intelligence (AI), machine learning, and advanced analytics that are designed to improve management, business operations, and customer reach by making processes simpler and more accessible than before. 
The company has seen some benefit from COVID-19 as there is little doubt that with companies are obligated to implement WFH procedures, the requirement for a solid IT infrastructure and digital tools are all the more essential.
Metrodata Electronic (MTDL IJ) has a long track record of sales and profits over the last few years and has also gradually improved margins at the same time. Being a distribution company, net margins remain relatively low at 2.5% but its move towards more consulting and solutions work will help to support and improve margins going forward. 
Valuations look attractive with the company trading on 8.7x FY21E PER, with forecast growth of +15% and +17% over FY21E and FY22E respectively, assuming flat net margins of 2.5%. Its international peers trade on an average of around 16x FY21 PER, which suggests Metrodata Electronic (MTDL IJ) is undervalued, especially given a positive earnings outlook. 

Metrodata Electronic (MTDL IJ) - A Rare Value Play on Indonesia's Digitalization

Making sense of the Global Market, Euromonitor International Ltd.

Yu Mitsuhashi

Making sense of the Global Market

Euromonitor International Ltd.

We are a global market research company focused on industries, countries, economies and consumers worldwide. Our cross-country comparable research helps your organisation identify opportunities and develop growth strategies in countries and regions across the globe. With offices around the world, 1,200 analysts in 100 countries and market research on every key trend and driver, we give you powerful access to the real story behind consumer change.

Thematic (Sector/Industry)

<h2>Headlines</h2><ul>
<li>In 2016 volume sales of personal care appliances grow by 3% to reach 590,000 units</li>
<li>Personal care appliances continue to be purchased mainly by middle upper income households</li>
<li>Hair care appliances registers the strongest retail volume growth of 3%</li>
<li>Average unit prices increases by 2% in current terms</li>
<li>Procter &amp; Gamble Home Products Indonesia leads the category with a 22% share of volume sales</li>
<li>Over the forecast period personal care appliances set to record a volume CAGR of 3% to approach sales of…</li>
</ul>

Headlines
In 2016 volume sales of personal care appliances grow by 3% to reach 590,000 units
Personal care appliances continue to be purchased mainly by middle upper income households
Hair care appliances registers the strongest retail volume growth of 3%
Average unit prices increases by 2% in current terms
Procter &amp; Gamble Home Products Indonesia leads the category with a 22% share of volume sales
Over the forecast period personal care appliances set to record a volume CAGR of 3% to approach sales of…


Sector Capsule: Personal Care Appliances in Indonesia

ASEAN (Indo) & China-focused. Ex-Deputy HoR UBS.

Johannes Salim, CFA

<ul><li>Our proprietary consumption scorecard reveals that Indonesia consumption in 2Q-4Q16 period is on the recovery path.</li><li>We expect the consumption recovery to progress into robust consumption state for 2017 due to 1) stronger lagged impact of 2016 rate cut, 2) rebound in commodity prices, and 3) better/stabilizing macro indicators such as inflation and unemployment rate</li><li>We prefer cyclical consumption theme; hence, <a href="https://www.smartkarma.com/entities/46" target="_blank" data-smartkarma-citation="entities:46">Astra International Tbk Pt (ASII IJ)</a> is our top pick in the overall consumer space. </li></ul>

Our proprietary consumption scorecard reveals that Indonesia consumption in 2Q-4Q16 period is on the recovery path.We expect the consumption recovery to progress into robust consumption state for 2017 due to 1) stronger lagged impact of 2016 rate cut, 2) rebound in commodity prices, and 3) better/stabilizing macro indicators such as inflation and unemployment rateWe prefer cyclical consumption theme; hence, Astra International Tbk Pt (ASII IJ) is our top pick in the overall consumer space. 

Hello Indo Consumption, How Are You Doing?

Smartkarma

Smartkarma unites the fragmented investment industry, connecting institutional investors, independent research providers, and corporates within a single network.

Research Reinvented

A meeting with Nielsen Indonesia in Jakarta last week revealed some positive signs of a recovery in consumer activity. After a nervous start to the year, with the overhang of "tax terrorism" and some unpredictable behavior post the Lebaran holiday season, the Indonesia consumer has seen better performance in October. With the first round of the tax amnesty done and the dues paid, sentiment should start to improve further. October and November data will be key indicators.Hypermarkets and supermarkets have been the worst hit, whilst mini-markets have seen the benefits of trading down. Beverages continue to see strong growth, especially mineral water, as does milk and ready-to-drink (RTD) Tea. Energy drinks are seeing stagnant growth, as are carbonated drinks, whilst cigarettes are seeing negative volume but positive value growth. Both traditional and modern formats continue to grow at a strong pace, with traditional outlets forecast to grow by 8% in 2016 to around 3m outlets. Indomaret and Alfamart plan to add 1,500 and 1,200 new mini-marts respectively in 2016 and a similar number in 2017. The government's new "Desa" (village) policy (Rp40tn) to improve  a nationwide distribution of basic goods by building small warehouses in every village, will help provide a new distribution network for manufacturers and stimulate consumption. Adspend has had a much better year in 2016, with double-digit growth (1Q +20%, 2Q +13% and 3Q +10%), with TV continuing to dominate 70% of the market. On-line advertising is showing strong growth but from a low base and FMCG still dominates, making up 6 out of the top 10 spots. Tobacco advertising on TV has seen +40% growth this year, since the abolition of billboard advertising end 2015. Interestingly, e-commerce advertising on TV has also been strong with 30% growth (5% of total). The views from Nielsen are being echoed by recent company visits to retailers such as <a href="https://www.smartkarma.com/entities/18684" target="_blank" data-smartkarma-citation="entities:18684:1">Mitra Adiperkasa Tbk Pt (MAPI IJ)</a> ,  <a href="https://www.smartkarma.com/entities/12808" target="_blank" data-smartkarma-citation="entities:12808:1">Ace Hardware Indonesia (ACES IJ)</a> and  <a href="https://www.smartkarma.com/entities/15659" target="_blank" data-smartkarma-citation="entities:15659:1">Sumber Alfaria Trijaya Tbk P (AMRT IJ)</a> , which are all interesting was to play the recovery. More to follow on the latter two in the coming week.

A meeting with Nielsen Indonesia in Jakarta last week revealed some positive signs of a recovery in consumer activity. After a nervous start to the year, with the overhang of "tax terrorism" and some unpredictable behavior post the Lebaran holiday season, the Indonesia consumer has seen better performance in October. With the first round of the tax amnesty done and the dues paid, sentiment should start to improve further. October and November data will be key indicators.Hypermarkets and supermarkets have been the worst hit, whilst mini-markets have seen the benefits of trading down. Beverages continue to see strong growth, especially mineral water, as does milk and ready-to-drink (RTD) Tea. Energy drinks are seeing stagnant growth, as are carbonated drinks, whilst cigarettes are seeing negative volume but positive value growth. Both traditional and modern formats continue to grow at a strong pace, with traditional outlets forecast to grow by 8% in 2016 to around 3m outlets. Indomaret and Alfamart plan to add 1,500 and 1,200 new mini-marts respectively in 2016 and a similar number in 2017. The government's new "Desa" (village) policy (Rp40tn) to improve  a nationwide distribution of basic goods by building small warehouses in every village, will help provide a new distribution network for manufacturers and stimulate consumption. Adspend has had a much better year in 2016, with double-digit growth (1Q +20%, 2Q +13% and 3Q +10%), with TV continuing to dominate 70% of the market. On-line advertising is showing strong growth but from a low base and FMCG still dominates, making up 6 out of the top 10 spots. Tobacco advertising on TV has seen +40% growth this year, since the abolition of billboard advertising end 2015. Interestingly, e-commerce advertising on TV has also been strong with 30% growth (5% of total). The views from Nielsen are being echoed by recent company visits to retailers such as Mitra Adiperkasa Tbk Pt (MAPI IJ) ,  Ace Hardware Indonesia (ACES IJ) and  Sumber Alfaria Trijaya Tbk P (AMRT IJ) , which are all interesting was to play the recovery. More to follow on the latter two in the coming week.

Indonesia Consumers Coming Back to the Table? On the Ground in J-Town

Indonesia

PT Metrodata Electronics, Tbk (“the Company”)—the publicly listed Company on Bursa Efek Indonesia (IDX) since 1990 (IDX: MTDL) is one of the leading Information and Communication Technology (“ICT”) companies in Indonesia that build strategic alliances with world‐class ICT companies.

The Company has main business units, namely Distribution Business (Providing World‐Class ICT Hardware and Software) that handles distribution to partnered dealers, ICT solution companies and also running an e‐commerce business. Its distribution network is covering more than 150 cities in Indonesia and has more than 4,000 channel partners and more than 100 world‐class IT products and service brands; Solution & Consulting Business (Digital Solution Provider to Help Companies Achieving Digital Transformation) that provides complete ICT solutions from conceptual/design, implementation, IT Managed Services, consulting and training, as well as support for business digital transformation.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

PT Metrodata Electronics (MTDL IJ)

The NEW Week that Was in ASEAN@Smartkarma - Syariah Banking, XL Axiata, and Telkom's Tower Spinoff

The Week that Was in ASEAN@Smartkarma is filled with an eclectic mix of differentiated, substantive, and actionable insights from across South East...

Angus Mackintosh

Metrodata Electronic (MTDL IJ) - A Rare Value Play on Indonesia's Digitalization

Metrodata Electronic (MTDL IJ) is a rare value play on the rapid digitalization in Indonesia, which has seen an acceleration driven by the growth...

Angus Mackintosh

Sector Capsule: Personal Care Appliances in Indonesia

Headlines In 2016 volume sales of personal care appliances grow by 3% to reach 590,000 units Personal care appliances continue to be purchased...

Euromonitor International Ltd.

Hello Indo Consumption, How Are You Doing?

Our proprietary consumption scorecard reveals that Indonesia consumption in 2Q-4Q16 period is on the recovery path. We expect the consumption...

Johannes Salim, CFA

Indonesia Consumers Coming Back to the Table? On the Ground in J-Town

A meeting with Nielsen Indonesia in Jakarta last week revealed some positive signs of a recovery in consumer activity. After a nervous start to the...

Angus Mackintosh

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