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

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

Sumber Alfaria Trijaya / Equity Bottom-Up

<ul>
<li>
<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 (AMRT IJ)</a> remains a leading player in Indonesian retail through its minimarkets with plans to accelerate store opening in 2022</li>
<li>The company reported strong 9M2021 results and we expect a strong seasonal finish to the year as mobility restrictions have relaxed in 4Q2021 further boosting demand</li>
<li>Sumber Alfaria Trijaya Tbk Pt (AMRT IJ) trades on 24.9x FY22ER PER and 21.7x FY2023E PER versus its 5-year average of 36.7x, making it look attractive from a historical perspective.</li>
</ul>



Sumber Alfaria Trijaya Tbk Pt (AMRT IJ) remains a leading player in Indonesian retail through its minimarkets with plans to accelerate store opening in 2022
The company reported strong 9M2021 results and we expect a strong seasonal finish to the year as mobility restrictions have relaxed in 4Q2021 further boosting demand
Sumber Alfaria Trijaya Tbk Pt (AMRT IJ) trades on 24.9x FY22ER PER and 21.7x FY2023E PER versus its 5-year average of 36.7x, making it look attractive from a historical perspective.


Sumber Alfaria Trijaya (AMRT IJ) - Back to Expansion Mode

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<p><a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> has a unique combination of different parts of the mobility ecosystem in Indonesia from corporate car rental, to car auction, and online marketplace but it is its end-to-end logistics business, and especially Anteraja, that is plugged directly into Indonesia's booming digital economy, that makes this an exciting story.</p>
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<section class="figure">Anteraja has expanded its coverage area significantly and is now present in 600 service points in 34 provinces across the archipelago.  It accounted for 47% of total sales in 1H2021 and is likely to account for more than 50% of sales by 2H2021.</section>
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<section class="figure"><a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> 1H2021 results saw the company's revenues grow by +50.4% YoY, with gross profit up +20% YoY, while operating profit grew +43.7%, and the company's net profit grew by +68.9% YoY</section>
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<p>In an interesting development, Anteraja, the last-mile delivery arm of <a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> has announced partnerships with both <a href="https://www.smartkarma.com/entities/grabtaxi-holdings-pte-ltd" target="_blank" data-smartkarma-citation="entities:26950:1" rel="noopener">Grab</a> and <a href="https://www.smartkarma.com/entities/gojek" target="_blank" data-smartkarma-citation="entities:25976:1" rel="noopener">Gojek</a>, to integrate both company's logistics services into its last-mile ecosystem.</p>
<p><a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> is a very interesting way to play the growth in the Indonesian digital economy through its exposure to logistics and the last-mile through Anteraja, which makes up close to 50% of sales, whilst its remaining business in car rental and car auction continue to produce stable growth.</p>
<p>The company trades on 42x FY22E PER and 31x FY223E PER but on 16.9x FY21EV/EBITDA and 13.4x FY23E EV/EBITDA, which is probably a better measure given that this is a growth company.</p>
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Adi Sarana Armada (ASSA IJ) has a unique combination of different parts of the mobility ecosystem in Indonesia from corporate car rental, to car auction, and online marketplace but it is its end-to-end logistics business, and especially Anteraja, that is plugged directly into Indonesia's booming digital economy, that makes this an exciting story.



Anteraja has expanded its coverage area significantly and is now present in 600 service points in 34 provinces across the archipelago.  It accounted for 47% of total sales in 1H2021 and is likely to account for more than 50% of sales by 2H2021.



Adi Sarana Armada (ASSA IJ) 1H2021 results saw the company's revenues grow by +50.4% YoY, with gross profit up +20% YoY, while operating profit grew +43.7%, and the company's net profit grew by +68.9% YoY

In an interesting development, Anteraja, the last-mile delivery arm of Adi Sarana Armada (ASSA IJ) has announced partnerships with both Grab and Gojek, to integrate both company's logistics services into its last-mile ecosystem.
Adi Sarana Armada (ASSA IJ) is a very interesting way to play the growth in the Indonesian digital economy through its exposure to logistics and the last-mile through Anteraja, which makes up close to 50% of sales, whilst its remaining business in car rental and car auction continue to produce stable growth.
The company trades on 42x FY22E PER and 31x FY223E PER but on 16.9x FY21EV/EBITDA and 13.4x FY23E EV/EBITDA, which is probably a better measure given that this is a growth company.









Adi Sarana Armada (ASSA IJ) - From the First to the Last Mile

<p><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 IJ)</a> released a solid set of 1H2021 results, which underlined its resilience in the face of COVID-19 but a real stand out from the numbers were the ongoing successes from its digital strategies both in terms of promoting products through online expos, as well as the continuing growth in both of transactional and digital banking franchises. </p>
<p><a href="https://www.bloomberg.com/quote/BBCA:IJ" target="_blank" rel="noopener">PT Bank Central Asia</a> recently announced that it will invest US$200m into its digital arm to fend off competition from new entrants to digital banking.</p>
<p>The bank will use the fresh funds to help Blu to increase market share ahead of an IPO within the next two years. <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 IJ)</a> plans to increase Blu’s capital to IDR4tn (US$278m), from around IDR1tn currently.</p>
<p><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 IJ)</a> will focus on winning more merchants, partners, and customers for Blu and intends to maintain a majority stake in the entity after listing.</p>
<p><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 IJ)</a> is already well ahead of its peers and any digital player on mobile banking and is Indonesia's leading bank in terms of transactional banking.</p>
<p>The bank saw 54% of all transactions by value and 86% of transactions by volume going through mobile or internet banking in 1H2021. This gives it access to high levels of CASA, providing the bank with a very low cost of funds.</p>
<p>Our view is that new digital players are more likely to take market share from smaller banks rather than <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 IJ)</a> and see the bank maintaining its lead in transactional banking in Indonesia. Blu also has the advantage of being backed by a well-known and trusted lender, which will help to attract new customers. </p>
<p><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 IJ)</a> trades on 4x FY21E PBV and is forecast to generate an ROE of 15.5% for FY21E and 17.0% in FY22E. It is one of the best-managed banks in Indonesia with a very strong risk management culture combined with a dynamic and innovative management culture, which coupled with its lead in transactional banking, allows the bank to command a significant premium over its peers. </p>

Bank Central Asia (BBCA IJ) released a solid set of 1H2021 results, which underlined its resilience in the face of COVID-19 but a real stand out from the numbers were the ongoing successes from its digital strategies both in terms of promoting products through online expos, as well as the continuing growth in both of transactional and digital banking franchises. 
PT Bank Central Asia recently announced that it will invest US$200m into its digital arm to fend off competition from new entrants to digital banking.
The bank will use the fresh funds to help Blu to increase market share ahead of an IPO within the next two years. Bank Central Asia (BBCA IJ) plans to increase Blu’s capital to IDR4tn (US$278m), from around IDR1tn currently.
Bank Central Asia (BBCA IJ) will focus on winning more merchants, partners, and customers for Blu and intends to maintain a majority stake in the entity after listing.
Bank Central Asia (BBCA IJ) is already well ahead of its peers and any digital player on mobile banking and is Indonesia's leading bank in terms of transactional banking.
The bank saw 54% of all transactions by value and 86% of transactions by volume going through mobile or internet banking in 1H2021. This gives it access to high levels of CASA, providing the bank with a very low cost of funds.
Our view is that new digital players are more likely to take market share from smaller banks rather than Bank Central Asia (BBCA IJ) and see the bank maintaining its lead in transactional banking in Indonesia. Blu also has the advantage of being backed by a well-known and trusted lender, which will help to attract new customers. 
Bank Central Asia (BBCA IJ) trades on 4x FY21E PBV and is forecast to generate an ROE of 15.5% for FY21E and 17.0% in FY22E. It is one of the best-managed banks in Indonesia with a very strong risk management culture combined with a dynamic and innovative management culture, which coupled with its lead in transactional banking, allows the bank to command a significant premium over its peers. 

PT Bank Central Asia (BBCA IJ) - The Future Is Blu

Nippon Indosari Corpindo / Equity Bottom-Up

<p>Indonesia's leading bread company <a href="https://www.smartkarma.com/entities/nippon-indosari-corpindo-tbk-pt" target="_blank" data-smartkarma-citation="entities:1181:1" rel="noopener">PT Nippon Indosari Corpindo (ROTI IJ)</a> announced a strong set of results for 1H2021 with net Income up by +33.2%, despite a -7.0% YoY decline in sales. </p>
<p><a href="https://www.smartkarma.com/entities/nippon-indosari-corpindo-tbk-pt" target="_blank" data-smartkarma-citation="entities:1181:1" rel="noopener">PT Nippon Indosari Corpindo( ROTI IJ)</a>'s 1H2021 return rate was improved to 10.4% versus 13.1% last year, as the company quickly anticipated changes in consumer shopping behaviour during the pandemic.</p>
<p>2Q2021 modern trade sales started to recover more than general trade, as the economy started to recover. The fact that malls have been shut in the latest emergency PPKM has been a positive for <a href="https://www.smartkarma.com/entities/nippon-indosari-corpindo-tbk-pt" target="_blank" data-smartkarma-citation="entities:1181:1" rel="noopener">PT Nippon Indosari Corpindo Tbk. (ROTI) (ROTI IJ)</a>. </p>
<p>1H2021 gross margin came under some pressure from rising wheat (flour) prices but ROTI was able to reduce overall operating expenses to offset this coupled with the fact that business no longer had the drag from SMFC in the Philippines.</p>
<p>An encouraging July 2021 indicates significantly increased sales per day for general and modern trade with sales per day hitting close to the record set in 4Q2019.</p>
<p><a href="https://www.smartkarma.com/entities/nippon-indosari-corpindo-tbk-pt" target="_blank" data-smartkarma-citation="entities:1181:1" rel="noopener">PT Nippon Indosari Corpindo (ROTI IJ)</a> remains a core consumer staples holding in Indonesia. It trades on 24.1x FY21E PER and 20.7x PER, with forecast EPS growth of +29.1% and +21.5% for FY21E and FY22E respectively versus its 5-year average forward PER of 27.7x, which looks relatively attractive.</p>

Indonesia's leading bread company PT Nippon Indosari Corpindo (ROTI IJ) announced a strong set of results for 1H2021 with net Income up by +33.2%, despite a -7.0% YoY decline in sales. 
PT Nippon Indosari Corpindo( ROTI IJ)'s 1H2021 return rate was improved to 10.4% versus 13.1% last year, as the company quickly anticipated changes in consumer shopping behaviour during the pandemic.
2Q2021 modern trade sales started to recover more than general trade, as the economy started to recover. The fact that malls have been shut in the latest emergency PPKM has been a positive for PT Nippon Indosari Corpindo Tbk. (ROTI) (ROTI IJ). 
1H2021 gross margin came under some pressure from rising wheat (flour) prices but ROTI was able to reduce overall operating expenses to offset this coupled with the fact that business no longer had the drag from SMFC in the Philippines.
An encouraging July 2021 indicates significantly increased sales per day for general and modern trade with sales per day hitting close to the record set in 4Q2019.
PT Nippon Indosari Corpindo (ROTI IJ) remains a core consumer staples holding in Indonesia. It trades on 24.1x FY21E PER and 20.7x PER, with forecast EPS growth of +29.1% and +21.5% for FY21E and FY22E respectively versus its 5-year average forward PER of 27.7x, which looks relatively attractive.

PT Nippon Indosari Corpindo (ROTI IJ) - Oven Ready

Indonesia

PT Sumber Alfaria Trijaya Tbk is an Indonesian retail company engaged in the distribution of consumer products, operating minimarket networks and franchise services primarily under the Alfamart brand. It offers a wide range of food and non-food products, cosmetics, and provides digital services such as bill payments and e-vouchers. The company was founded in 1989 and is headquartered in Tangerang, Indonesia.

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Sumber Alfaria Trijaya (AMRT 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