Indonesia

• The review period for the LQ45 Index ends on 30 June. The changes should be announced in the last week of July, becoming effective after the close on 31 July.
• Based on the index methodology, there could be up to 5 changes at the rebalance. Plus there will be capping changes for Bank Rakyat (BBRI) and Bank Central Asia (BBCA).
• The impact of passive trading will be higher on the deletions than the inclusions since lower liquidity stocks are replaced with higher liquidity stocks.

• Mitsubishi UFJ Financial (MUFG US) and 92.7%-held Adira Dinamika Multi Finance (ADMF IJ) have entered into SPAs with key shareholders to acquire an 80.6% stake in Mandala Multifinance (MFIN IJ).
• MUFG and Adira appear to be paying IDR 3,297/share or IDR 7tn all-in. The SPAs are subject to regulatory approvals with completion expected in early 2024. 
• Upon completion, MUFG will hold 70.6% in Mandala and Adira 10% in the Indo car/motorcycle loan lender. This will trigger a Mandatory Tender Offer for the remaining 19.4%.

Lucror Analytics Weekly Wraps provide an overview of all Morning Views comments and reports published by our analyst team in the past week, and also showcase a list of the most-read reports.

In this Insight:

1. China Jinmao Holdings
2. Lifestyle International Holdings
3. Geely Auto
4. First Pacific Co
5. Tata Motors Ltd

and more…

• Bank Rakyat Indonesia (BBRI IJ) continues to march to the tune of its micro-lending capabilities with recent moves focused on growing its higher-yield Kupedes and ultra-micro loans. 
• Upward pressure on funding costs in 1Q2023 was more than offset by a shift to higher-yield loans and lower cost of credit, with greater efficiencies through digital initiatives.
• Bank Rakyat Indonesia (BBRI IJ) is somewhat overcapitalized which allows for higher dividend payout and higher ROEs over time. The bank remains a core holding in Indonesia 

• Puradelta Lestari (DMAS IJ) remains one of the most interesting industrial estate developers in Indonesia with a high-quality tenant base across growth sectors including autos, 2W, pharmaceuticals, and data centres.
• The completion of a new AEON Mall will provide a further draw for the estate as a destination and a place to live and work and is increasingly well-connected.
• DMAS had a slower start to the year for revenues but marketing sales are running ahead of schedule having beat last year, with bookings expected to pick up in 2023.

• Metrodata Electronics released a mixed set of 1Q2023 results, as its ICT distribution slowed as consumers held back from new purchases but this was offset by stronger Solutions&Consulting revenues.
• Solutions&Consulting saw strong growth from financial services, with the ongoing boost from BIFAST plus there was strong growth from telcos and the government segment, as it focuses on digitalisation. 
• Metrodata Electronics management remains optimistic for 2023, with an expected recovery in distribution revenues in 2H2023 with the guidance of 8% growth for both revenue and net profits for FY2023. 

• Amman Mineral Internasional (1416286D IJ) is offering 7.288bn shares in its IPO at a price range of IDR 1650-1775/share to raise between US$808-870m and valuing the company between US$8.08-8.7bn.
• The stock will not get fast entry to global indices or local Indonesia indices (IDX30 Index/ LQ45 Index/ IDX80 Index).
• With listing planned for 5 July, the earliest index inclusion will be in December and there are no near-term passive flows expected for the stock.

• Amman Mineral Internasional (1416286D IJ) is looking to raise up to US$868m in its Indonesian IPO. 
• Amman Mineral International (AMI) carries out exploration, development, mining, processing. The company operates an open pit copper and gold mine known as the Batu Hijau mine in Indonesia.
• In our previous notes, we looked at the company’s past performance. In this note, we undertake a quick peer comparison and share our thoughts on valuation.

• Amman Mineral Internasional (1416286D IJ), an Indonesian copper-gold producer, has launched an IDX IPO to raise US$870 million. Bookbuilding runs from 31 May to 16 June.
• We previously discussed the IPO in Amman Mineral Internasional IPO: The Investment Case. 
• In this note, we discuss valuation. Our analysis suggests that the IPO price range of IDR1,650-1,775 per share is attractive. We would participate in the IPO.

• ASSA continues to demonstrate the ability to adapt to the changing environment in 1Q2023 with growth in its car fleet and improving profitability for logistics and the last mile. 
• Anteraja has seen a slowdown in e-commerce revenues but is focusing more on building offline customers, whilst ASSA logistics is increasingly focused on mid-mile and cold-chain logistics. 
• JBA Auction is seeing a strong recovery to pre-pandemic levels and maintains 40% market share, whilst Caroline is targeting 3,000-4,000 used car sales in 2023, whilst expanding its offline network.

• BFI Finance Indonesia management recently confirmed its expectations for receivables growth of +20% YoY this year, which looks conservative after a strong start to the year, with +53.9% new-financing growth. 
• The company booked a strong set of 1Q2023 numbers with strong new bookings growth,  improving net interest spreads, low NPLs, and an ROE of over 22%
• BFI Finance Indonesia has the lowest cost of funds of the multi-finance companies in Indonesia, with a long track record of strong risk management, and remains a top pick.

• GoTo (GOTO IJ) is seeking shareholder approval to raise new capital through a private placement of shares (118.4bn A shares). Shareholder meeting will be held on 30th June.
• The company’s strategy to prioritise profits have put pressure on growth rates and it seems that the company is in need of more funds to refuel its decelerating growth rates.
• Though profit matrices have improved, some important growth matrices such as GTV have shown a downward trend and the company is still burning cash.

• Amman Mineral Internasional (1416286D IJ) is looking to raise around US$880m in its Indonesian IPO. 
• Amman Mineral International (AMI) carries out exploration, development, mining, processing. The company operates an open pit copper and gold mine known as the Batu Hijau mine in Indonesia.
• AMI’s profitability grew dramatically over the track record period. However, copper prices might possibly be on a downtrend in the near term.

Lucror Analytics Weekly Wraps provide an overview of all Morning Views comments and reports published by our analyst team in the past week, and also showcase a list of the most-read reports.

In this Insight:

1. Vedanta Resources
2. China Jinmao Holdings
3. Lifestyle International Holdings
4. Geely Auto
5. First Pacific Co

and more…

The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks. The Asia Monthly is intended to broaden investors’ understanding of the Asian USD high-yield market.

• Amman Mineral Internasional (1416286D IJ), an Indonesian copper-gold producer, has launched an IDX IPO to raise US$860 million. Bookbuilding runs from 31 May to 16 June.
• Amman’s Batu Hijau mine when combined with the Elang project has the fifth largest copper equivalent reserves in the world, according to Wood Mackenzie.
• The key elements of the investment case rest on world-class reserves, credible development plans, solid top-line growth, high profitability, leading cost competitiveness and cash generation.

• Indonesia-based social commerce platform Evermos today announced that it had raised US$39 million in its Series C funding round.
• It was led by the International Finance Corporation (IFC) — a member of the World Bank group — and IFC Emerging Asia Fund, LP, managed by IFC Asset Management Company, with the participation of returning partners such as Jungle Ventures, Shunwei Capital, UOB Venture Management, and Telkomsel Mitra Inovasi.
• This funding round also saw investment from new partners SWC Global, Endeavor Catalyst, and Uni-President Asset Holdings.

• Indonesia-based digital mortgage startup Ringkas has secured US$3.5 million in a seed funding round led by East Ventures and Crestone Venture Capital.
• 500 Global, Teja Ventures, Orvel Ventures, and Hustle Fund also participated.
• Ringkas will use the fresh funds to advance and scale its platform across multiple cities in Indonesia and the secondary market.