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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<li>
<a href="https://www.smartkarma.com/entities/ultrajaya-milk-industry-trading-company" target="_blank" data-smartkarma-citation="entities:13892:1" rel="noopener">Ultrajaya Milk</a> remains one of Indonesia's leading dairy companies with a leading 36% market share of the UHT milk market, with Indonesia being one of the lowest consumers in ASEAN.  </li>
<li>The company has seen a strong recovery in its dairy business and will be a key beneficiary of the school meals program in Indonesia, launched this year by President Prabowo.</li>
<li>
<a href="https://www.smartkarma.com/entities/ultrajaya-milk-industry-trading-company" target="_blank" data-smartkarma-citation="entities:13892:1" rel="noopener">Ultrajaya</a>'s new distribution centre in MM2100 is now operating with manufacturing to start in 3Q2025, helping to drive longer-term growth. Valuation is attractive versus peer Cimory with growth outlook improving. </li>
</ul>



Ultrajaya Milk remains one of Indonesia's leading dairy companies with a leading 36% market share of the UHT milk market, with Indonesia being one of the lowest consumers in ASEAN.  
The company has seen a strong recovery in its dairy business and will be a key beneficiary of the school meals program in Indonesia, launched this year by President Prabowo.

Ultrajaya's new distribution centre in MM2100 is now operating with manufacturing to start in 3Q2025, helping to drive longer-term growth. Valuation is attractive versus peer Cimory with growth outlook improving. 


Ultrajaya Milk (ULTJ IJ) - Bringing Milk to the Children

Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

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<li>
<a href="https://www.smartkarma.com/entities/first-pacific-co-ltd" target="_blank" data-smartkarma-citation="entities:173:1" rel="noopener">First Pacific Co (142 HK)</a> is a Southeast Asian conglomerate that has been handicapped by its listing in the Hong Kong market over the last several years.</li>
<li>As Southeast Asian markets (Indonesia and Philippines) begin to re-rate on the back of a more accommodating Fed policy, First Pacific is beginning to participate in the uptrend.</li>
<li>Metro Pacific Investments Corp (MPIC), the second largest piece of the company's NAV has been active in acquiring more infrastructure assets since being privatized last year.</li>
</ul>



First Pacific Co (142 HK) is a Southeast Asian conglomerate that has been handicapped by its listing in the Hong Kong market over the last several years.
As Southeast Asian markets (Indonesia and Philippines) begin to re-rate on the back of a more accommodating Fed policy, First Pacific is beginning to participate in the uptrend.
Metro Pacific Investments Corp (MPIC), the second largest piece of the company's NAV has been active in acquiring more infrastructure assets since being privatized last year.


BUY: First Pacific Company (142 HK): Right Stock Trapped in the Wrong Market

Cross Asset Strategy

<ul>
<li>The Indonesian stock market was down 2% over the last year despite a flurry of inflows in the summer but this year looks interesting with a new government in place. </li>
<li>GDP growth forecasts are more optimistic for 2025 and government stimulus should help to drive higher consumption, with FDI driven by more value-added investments in the EV-related projects. </li>
<li>Increasing digitalisation of the economy and greater use of AI will drive profitability and data centre growth. Interest rates are expected to fall -50-100bps which should also be supportive.</li>
</ul>


The Indonesian stock market was down 2% over the last year despite a flurry of inflows in the summer but this year looks interesting with a new government in place. 
GDP growth forecasts are more optimistic for 2025 and government stimulus should help to drive higher consumption, with FDI driven by more value-added investments in the EV-related projects. 
Increasing digitalisation of the economy and greater use of AI will drive profitability and data centre growth. Interest rates are expected to fall -50-100bps which should also be supportive.


CrossASEAN Indonesia Strategy - Parting Clouds

<ul>
<li>Indonesia has been the recipient of significant investment flows for foreign investors with more of a "risk on" environment with a large portion flowing into Indonesian banks. </li>
<li>Indonesia stacks up from an investment perspective with a stable political environment, solid GDP growth of around 5% YoY, rising flows of FDI, and a more stable IDR.</li>
<li>Despite the JCI knocking on all-time highs, valuations continue to look attractive with prospects of a better 2H2024 and lower interest rates. Top picks: Banks, property, consumer, and selective elsewhere. </li>
</ul>


Indonesia has been the recipient of significant investment flows for foreign investors with more of a "risk on" environment with a large portion flowing into Indonesian banks. 
Indonesia stacks up from an investment perspective with a stable political environment, solid GDP growth of around 5% YoY, rising flows of FDI, and a more stable IDR.
Despite the JCI knocking on all-time highs, valuations continue to look attractive with prospects of a better 2H2024 and lower interest rates. Top picks: Banks, property, consumer, and selective elsewhere. 


Indonesia Strategy - Caught in a Perfect Updraft?

<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

Indonesia

PT Ultrajaya Milk Industry and Trading Company Tbk operates in the food and beverage industry. The Company produces aseptic drinks such as liquid milk, fruit juices and health drinks. Ultrajaya Milk also produces butter, powder milk and sweet condensed milk.

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Ultrajaya Milk (ULTJ IJ)