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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Index Rebalance

<ul>
<li>At the January review, there are 2 changes to the IDX30 Index, 5 changes to the LQ45 Index, and 9 changes to the IDX30 Index.</li>
<li>Largest buying impact will be on <a href="https://www.smartkarma.com/entities/sumber-alfaria-trijaya-tbk-pt" target="_blank" data-smartkarma-citation="entities:15659:1" rel="noopener">Sumber Alfaria Trijaya Tbk Pt</a>, <a href="https://www.smartkarma.com/entities/elang-mahkota-teknologi-tbk" target="_blank" data-smartkarma-citation="entities:7752:1" rel="noopener">Emtek (EMTK IJ)</a>, <a href="https://www.smartkarma.com/entities/waskita-karya-persero-tbk-pt" target="_blank" data-smartkarma-citation="entities:15739:1" rel="noopener">Waskita Karya (Persero) (WSKT IJ)</a>, <a href="https://www.smartkarma.com/entities/bfi-finance-indonesia-tbk-pt" target="_blank" data-smartkarma-citation="entities:8447:1" rel="noopener">BFI Finance Indonesia (BFIN IJ)</a> and <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>. </li>
<li>Largest selling impact will be on <a href="https://www.smartkarma.com/entities/ace-hardware-indonesia" target="_blank" data-smartkarma-citation="entities:12808:1" rel="noopener">Ace Hardware Indonesia (ACES IJ)</a>, <a href="https://www.smartkarma.com/entities/jasa-marga-persero-tbk-pt" target="_blank" data-smartkarma-citation="entities:12747:1" rel="noopener">Jasa Marga (JSMR IJ)</a>, <a href="https://www.smartkarma.com/entities/pakuwon-jati-tbk-pt" target="_blank" data-smartkarma-citation="entities:8550:1" rel="noopener">Pakuwon Jati (PWON IJ)</a> , <a href="https://www.smartkarma.com/entities/bumi-serpong-damai-pt" target="_blank" data-smartkarma-citation="entities:15498:1" rel="noopener">Bumi Serpong Damai (BSDE IJ)</a> and <a href="https://www.smartkarma.com/entities/hm-sampoerna-tbk-pt" target="_blank" data-smartkarma-citation="entities:617:1" rel="noopener">HM Sampoerna (HMSP IJ)</a>.</li>
</ul>


At the January review, there are 2 changes to the IDX30 Index, 5 changes to the LQ45 Index, and 9 changes to the IDX30 Index.
Largest buying impact will be on Sumber Alfaria Trijaya Tbk Pt, Emtek (EMTK IJ), Waskita Karya (Persero) (WSKT IJ), BFI Finance Indonesia (BFIN IJ) and XL Axiata (EXCL IJ). 
Largest selling impact will be on Ace Hardware Indonesia (ACES IJ), Jasa Marga (JSMR IJ), Pakuwon Jati (PWON IJ) , Bumi Serpong Damai (BSDE IJ) and HM Sampoerna (HMSP IJ).


IDX30/LQ45 Index Rebalance: BIG Impact Changes in Limited Time

<ul>
<li>The review period for the LQ45 Index ended on 31 December. The changes should be announced in the last week of January, becoming effective after the close on 31 January.</li>
<li>We see <a href="https://www.smartkarma.com/entities/waskita-karya-persero-tbk-pt" target="_blank" data-smartkarma-citation="entities:15739:1" rel="noopener">Waskita Karya (Persero) (WSKT IJ)</a>, <a href="https://www.smartkarma.com/entities/bfi-finance-indonesia-tbk-pt" target="_blank" data-smartkarma-citation="entities:8447:1" rel="noopener">BFI Finance Indonesia (BFIN IJ)</a> and <a href="https://www.smartkarma.com/entities/harum-energy-tbk-pt" target="_blank" data-smartkarma-citation="entities:1604:1" rel="noopener">Harum Energy (HRUM IJ)</a> as higher probability inclusions in the LQ45 Index.</li>
<li>Given the focus is on liquidity, we see <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 IJ)</a>, <a href="https://www.smartkarma.com/entities/bumi-serpong-damai-pt" target="_blank" data-smartkarma-citation="entities:15498:1" rel="noopener">Bumi Serpong Damai (BSDE IJ)</a> and <a href="https://www.smartkarma.com/entities/akr-corporindo-tbk-pt" target="_blank" data-smartkarma-citation="entities:13338:1" rel="noopener">AKR Corporindo (AKRA IJ)</a> as higher probability deletion candidates.</li>
</ul>


The review period for the LQ45 Index ended on 31 December. The changes should be announced in the last week of January, becoming effective after the close on 31 January.
We see Waskita Karya (Persero) (WSKT IJ), BFI Finance Indonesia (BFIN IJ) and Harum Energy (HRUM IJ) as higher probability inclusions in the LQ45 Index.
Given the focus is on liquidity, we see Jasa Marga (Persero) (JSMR IJ), Bumi Serpong Damai (BSDE IJ) and AKR Corporindo (AKRA IJ) as higher probability deletion candidates.


LQ45 Index Rebalance Preview (Feb 2022): Potential Changes Later This Month

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

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<p><a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> announced a pretty robust set of 9M2021 results considering the backdrop of Emergency PPKM in Indonesia.  In our view, <a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> has become investable again after a series of disappointments and misteps on strategy made it a minefield for long-term investors. Over the past two years the company has made numerous strategic moves under the guidance of new management, which have reversed a number of strategies that were clearly not working.</p>
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<p><a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> continues to use non-store channels during Emergency PPKM during 3Q2021 to partially mitigate the impact and a full opening of stores in September also has some positive impact.</p>
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<section class="figure">The company saw all of its 137 stores reopned by 8th September with a gradual improvement in terms of access over the month and kids allowed back into the malls again in October, which helped to further improve traffic. </section>
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<section class="figure"><a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> has had  a new Chief Merchandising Officer in place called Rachel Stack for over a year now, who has a rich history in the retail business in the UK and Europe. She has already made significant changes to its merchandising mix. </section>
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<section class="figure">Overall the company is focused on what it terms "aspirational yet affordable" products and a rejuvenated omnichannle approach. The intention is to use its stores as assets in the future to aid fulfilment, with customer curated ranges to prevent any undue discount cycles.</section>
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<section class="figure"><a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> has resumed issuing guidance in November this year, which is also reassuring, with the resumption of a dividend payout a further positive for long-term investors.</section>
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<section class="figure">Valuations look reasonable, with the company trading on 12.6x FY22E PER and 9.7x FY23E PER, with forecast EPS growth of +58.7% and +29.4% for FY22E and FY23E respectively. It also continues to trade at a discount to its peers, which seems unjustified given the transformation taking place.</section>
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Matahari Department Store (LPPF IJ) announced a pretty robust set of 9M2021 results considering the backdrop of Emergency PPKM in Indonesia.  In our view, Matahari Department Store (LPPF IJ) has become investable again after a series of disappointments and misteps on strategy made it a minefield for long-term investors. Over the past two years the company has made numerous strategic moves under the guidance of new management, which have reversed a number of strategies that were clearly not working.

Matahari Department Store (LPPF IJ) continues to use non-store channels during Emergency PPKM during 3Q2021 to partially mitigate the impact and a full opening of stores in September also has some positive impact.

The company saw all of its 137 stores reopned by 8th September with a gradual improvement in terms of access over the month and kids allowed back into the malls again in October, which helped to further improve traffic. 






Matahari Department Store (LPPF IJ) has had  a new Chief Merchandising Officer in place called Rachel Stack for over a year now, who has a rich history in the retail business in the UK and Europe. She has already made significant changes to its merchandising mix. 




Overall the company is focused on what it terms "aspirational yet affordable" products and a rejuvenated omnichannle approach. The intention is to use its stores as assets in the future to aid fulfilment, with customer curated ranges to prevent any undue discount cycles.




Matahari Department Store (LPPF IJ) has resumed issuing guidance in November this year, which is also reassuring, with the resumption of a dividend payout a further positive for long-term investors.


Valuations look reasonable, with the company trading on 12.6x FY22E PER and 9.7x FY23E PER, with forecast EPS growth of +58.7% and +29.4% for FY22E and FY23E respectively. It also continues to trade at a discount to its peers, which seems unjustified given the transformation taking place.














Matahari Department Store (LPPF IJ) - Revamped, Refreshed, and Investable

Pan-Asia Equity Bottom-up, Wickhams Hill

Lloyd Moffatt

Pan-Asia Equity Bottom-up

<ul>
<li>Bank Rakyat’s (BBRI IJ) rights issue puts the largest listed Indonesian microlender BTPN Syariah (BTPS IJ) in the spotlight as PNM steps up to the plate to do some national service</li>
<li>Matahari Department Stores (LPPF IJ) is up 30% since we flagged a major buyback program on the back of solid 2Q21 results</li>
<li>The Hour Glass (HG SP) share price has started to react to an ongoing buyback, up 16% MTD on a further 710k shares repurchased</li>
</ul>


Bank Rakyat’s (BBRI IJ) rights issue puts the largest listed Indonesian microlender BTPN Syariah (BTPS IJ) in the spotlight as PNM steps up to the plate to do some national service
Matahari Department Stores (LPPF IJ) is up 30% since we flagged a major buyback program on the back of solid 2Q21 results
The Hour Glass (HG SP) share price has started to react to an ongoing buyback, up 16% MTD on a further 710k shares repurchased


Wickhams Hill Research | Under-The-Radar Issue 7

<p><a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> released its 2Q2021 results after market yesterday, which revealed a significant turnaround in the business, with the company returning to profitability both on EBITDA and net profit.</p><p>Management managed to navigate a tricky Lebaran holiday season successfully despite mudik bans and reduced operating hours,  flushing out most of its discontinued brands with only a little leftover in inventory, leading to healthier gross margins. </p><p><a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> continued to make good progress in key operational areas with its store enhancement work in progress, along with a re-organization of operating regions, more focused use of capex and continuing rationalization of underperforming stores.</p><p><a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener"></a>The company has a new merchandising team in place with a focus on modernizing the mix of products with a focus on in-house brands such as Coles, Nevada, and Connexion.</p><section class="figure"></section><p><a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> continues to collaborate with <a href="https://www.smartkarma.com/entities/bank-nationalnobu-tbk-pt" target="_blank" data-smartkarma-citation="entities:17016:1" rel="noopener">Bank Nationalnobu (NOBU IJ)</a> and has seen a +59%  increase in the value of its investment since November 2020. We see this as a potentially positive collaboration but would not want to see any more significant capital commitments to the bank. </p><p>The company has seen a significant strengthening of its balance sheet for 1H2021, with <a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> now debt-free and in a net cash position.</p><p> No doubt there will be some disruption from Emergency PPKM measures in July and August but the performance in 2Q2021 has put the company on course for a strong recovery toward the end of the year, with a much healthier stores portfolio, with new stores added trading well with strong profitability.</p><section class="figure"></section><section class="figure"></section><section class="figure"></section><section class="figure"></section><section class="figure"><section class="figure"><figure class="editor-figure mceNonEditable"></figure></section><div>
<p><a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> looks like it has finally turned the corner after a strong performance over the Lebaran quarter and this turnaround has come slightly earlier than expected. </p>
<p>Valuations look attractive versus history with the company trading on 9.7x FY22E PER and 6.5x FY22E PER versus its 5-year average forward PER of 12x, making the company an attractive prospect in light of its turnaround.</p>
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Matahari Department Store (LPPF IJ) released its 2Q2021 results after market yesterday, which revealed a significant turnaround in the business, with the company returning to profitability both on EBITDA and net profit.Management managed to navigate a tricky Lebaran holiday season successfully despite mudik bans and reduced operating hours,  flushing out most of its discontinued brands with only a little leftover in inventory, leading to healthier gross margins. Matahari Department Store (LPPF IJ) continued to make good progress in key operational areas with its store enhancement work in progress, along with a re-organization of operating regions, more focused use of capex and continuing rationalization of underperforming stores.The company has a new merchandising team in place with a focus on modernizing the mix of products with a focus on in-house brands such as Coles, Nevada, and Connexion.Matahari Department Store (LPPF IJ) continues to collaborate with Bank Nationalnobu (NOBU IJ) and has seen a +59%  increase in the value of its investment since November 2020. We see this as a potentially positive collaboration but would not want to see any more significant capital commitments to the bank. The company has seen a significant strengthening of its balance sheet for 1H2021, with Matahari Department Store (LPPF IJ) now debt-free and in a net cash position. No doubt there will be some disruption from Emergency PPKM measures in July and August but the performance in 2Q2021 has put the company on course for a strong recovery toward the end of the year, with a much healthier stores portfolio, with new stores added trading well with strong profitability.
Matahari Department Store (LPPF IJ) looks like it has finally turned the corner after a strong performance over the Lebaran quarter and this turnaround has come slightly earlier than expected. 
Valuations look attractive versus history with the company trading on 9.7x FY22E PER and 6.5x FY22E PER versus its 5-year average forward PER of 12x, making the company an attractive prospect in light of its turnaround.




Matahari Department Store (LPPF IJ) - Turning Corners

Indonesia

PT MDS Retailing Tbk is an Indonesian retail company that operates department store chains and online channels under the Matahari brand. It offers a diverse range of products including clothing, fashion apparel, accessories, bags, shoes, cosmetics, beauty products, and household appliances. The company also provides management consulting services. PT MDS Retailing Tbk was founded in 1958 and is headquartered in Tangerang, Indonesia.

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MDS Retailing (LPPF IJ)

IDX30/LQ45 Index Rebalance: BIG Impact Changes in Limited Time

There are 2 changes to the IDX30, 5 to the LQ45, and 9 to the IDX80. There are a few large impact/flow names on the IDX30/LQ45 indices. The adds...

Brian Freitas

LQ45 Index Rebalance Preview (Feb 2022): Potential Changes Later This Month

Changes to the LQ45 Index will be announced soon & become effective after the close on 31 Jan. We see three potential changes. The adds outperform...

Brian Freitas

Matahari Department Store (LPPF IJ) - Revamped, Refreshed, and Investable

Matahari Department Store (LPPF IJ) has become investable again with an omnichannel approach and a revamped and refreshed brand portfolio.

Angus Mackintosh

Wickhams Hill Research | Under-The-Radar Issue 7

Bank Rakyat’s (BBRI IJ) rights issue puts the largest listed Indonesian microlender BTPN Syariah (BTPS IJ) in the spotlight as PNM steps up to the...

Lloyd Moffatt

Matahari Department Store (LPPF IJ) - Turning Corners

Matahari Department Store just announced 2Q2021 resluts, which showed a significant turnaround in the business, which we suggest is sustainable and...

Angus Mackintosh

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