Daily Focus. Indonesia. February 05, Short term pain long term gain

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Allison Holmes
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Indonesia Daily Focus Betrand Raynaldi +62-21-515-1141 betrand.raynaldi @dwsec-id.com For subscription of our Daily Focus, please contact us at research@dwsec-id.

1 Indonesia Daily Focus Betrand Raynaldi For subscription of our Daily Focus, please contact us at Market Index Last Trade Chg (%) MoM YoY JCI 5, MSCI EM HANG SENG 24, KOSPI 1, FTSE 6, DJIA 17, NASDAQ 4, Key Rates Last Trade Chg (bps) MoM YoY Policy Rate yr yr FX Last Trade Chg (%) MoM YoY USD/IDR 12, USD/KRW 1, USD/JPY USD/CNY Commodities Last Trade Chg (%) MoM YoY WTI Gold 1, Coal Palm Oil Rubber Nickel 15, Copper 5, Tin 19, JCI Index VS MSCI Emerging Markets (pt) JCI MSCI EM (pt) 1,200 5,500 4,500 3,500 05/13 02/14 11/14 1, Short term pain long term gain Only a few public companies have an integrated business of sales and leasing vehicles, as well as financing and insurance support. Those public companies are Astra International (ASII IJ), Indomobil Sukses International (IMAS IJ) and Mitra Pinasthika Mustika (MPMX IJ). But we cannot compare each other since the differences in market capitalization and assets. In terms of market capitalization, MPMX is the smallest among the three, but an interesting thing to watch of this company is its growth acceleration as result of its expansion. The following are the company expansion realization last year. Distribution: The car dealership is the company s new business. It has opened 4-Datsun Nissan car dealerships last year and this year the company will expand another 12 dealers (1 car dealership has opened this year). The company s dealer will focus on sales, services and spare parts. The company estimated their dealers sold 1,500 units last year. Consumer parts: The Company, through its brand federal oil, expanded its lubricant business for cars and motorcycles. Auto services: Increased the number of its rental fleet by 4,000 cars last year (3,000 cars realized in September 2014, making a total of cars). Most of the company s clients are large companies such as Panasonic, Huawei, Syngenta. The average duration of vehicle lease contract is 2.5 years. Insurance: The Company expanded its insurance network by adding 5 representative offices to total of 12 offices. Consumer financing: The Company merged 2 of its financing subsidiaries. The company's expansions above did not contribute to the 3Q14 revenue, hence its revenue picked up only up by 16% YoY to IDR12tr. While operating income is relatively stagnant at IDR716bn, due to the rising cost of salaries by 31% YoY, we think it is reasonable considering the company s aggressive expansion. The company's profit for the period decreased by 3% to IDR399bn, the decline in net profit is due to an increase in net interest of 26% to fund its expansion. Due to a decrease in the company's performance and its trading liquidity, the stock was in a downtrend. Share price is already down 47% from the IPO price. But we think the current price does not correctly reflect its strong fundamentals. The company only trades at 5.2x 2015F P/E, which is lower than the industry P/E at 19.7x.

2 Local flashes TOTL: New contract lowered due to lack of manpower. PT Total Bangun Persada Tbk (TOTL) targeting 2015 revenue of IDR2.3trillion. The target is up 15% from last year's achievement of IDR2trillion. Despite aiming for revenue growth, TOTL plans to lowered new contracts. This year, a new contract is targeted only IDR3trillion cut half from the achievements of new contract in 2014 IDR6.2trillion. (Kontan) SMBR: Semen Baturaja begin working on plant project worth IDR3.3trillion. Stateowned company PT Semen Baturaja (Persero) Tbk. start construction of plant valued at IDR3.32trillion, with a production capacity of 1.85 million tons. Zulfikri Subli, SMBR Corporate Secretary, said it plans to build a cement plant has received approval from the board of commissioners by letter No. S-01 / DK-SB / I / 2015 on February 2, (Bisnis Indonesia) TCID: 2014 Net Profit Up 8.7% as Revenue Increase. PT Mandom Indonesia Tbk. (TCID) net profit for the period of 2014 amounting to IDR174billion, or increase by 8.7% compared to the prior year achievment. Takeshi Hibi, President TCID, said the company achieved sales of IDR2.3trillion over the period of 2014, or increase 13.8% compared to the previous year. (Bisnis Indonesia) WOMF: Right Issue IDR200billion. Financing company PT Wahana Ottomitra Multiartha Tbk. (WOMF) issuing new shares (rights issue) through a limited public offering (PUT) I totaling IDR199.99billion. According to official information released on Wednesday (01/04/2015), WOM Finance will issue PUT I with pre-emptive rights (HMETD) as much as 1.48 billion new shares with a nominal value of IDR100 per share at an offering price IDR135 per share. (Bisnis Indonesia) BBNI: BNI targeting trade finance business grew 20%. PT Bank Negara Indonesia Tbk (BBNI) aiming for growth in import-export trade or trade finance grew by double digits in the 2015's. Abdullah Firman Wibowo, SVP and Head of International BNI said, bank can seize the opportunity for the Ministry of Trade import export commodity-based companies do require a letter of credit (L / C). (Kontan) ADES: Enter health beverage business with Pureal. Producers of bottled drinking water and cosmetics PT Akasha Wira International Tbk now go into business, health drinks. ADES issued a health drink soya milk taste with brand Pureal, in early December last year. Martin Jimi, Director of ADES said reason for company issued Pureal is because it sees there is a niche market and great potential in health drinks segment maximum untapped. (Kontan) BBRI: BRI Targeting Fee-Based Income Up by a Fifth in Bank Rakyat Indonesia aims to have its fee-based income in 2015 up by 20 percent to 25 percent on the back of its electronic services network expansion, the lender s corporate secretary Budi Satria said in a statement. The expansion will include increasing the number of its mobile-banking agents, automated teller machines and its online banking service, Budi said. (Jakarta Globe) 2

Technical analysis Recommendation Trading Buy Resistance 5,348 Support 5,256 Close 5,292 Indicator GC = Golden-cross DC = Dead-cross UP = Up DN = Down NM = Normal Stoch GC MACD UP PSAR UP Volume UP

s plan to inject capital to SOE have made construction stocks tumbled, this sentiment will continue today.

3 Technical analysis Recommendation Trading Buy Resistance 5,348 Support 5,256 Close 5,292 Indicator GC = Golden-cross DC = Dead-cross UP = Up DN = Down NM = Normal Stoch GC MACD UP PSAR UP Volume UP AC = Accumulation Dis = Distribution OB = Overbought OS = Oversold Investor Sentiment Rumor regarding price of ADHI s right issue and news saying that the parliament did not agree with the government s plan to inject capital to SOE have made construction stocks tumbled, this sentiment will continue today. Daily Chart On yesterday s trading, index was opened jumped up making the highest intraday level at 5, However, profit taking action pressured the index back to opening level. The increased was followed by rising volume which also made the stochastic indicator goldencross, MACD and PSAR rose as well. Intraday Chart Index had the chance to penetrate its highest level but after selling pressure from profit taking action have made the index went down from that level, however on the last hour of trading, the index rebound back although that change gave no impact to MACD, stochastic and PSAR indicator which tends decreasing. We see that on today s trading the index will move mixed with upside trend. Chart 1. Daily chart Chart 2. Intraday chart Source: HOTS, Source: HOTS, 3

4 Chart 3. JCI Vs. USD/IDR (pt) JCI Composite Index (L) 5,400 USD/IDR (R) 5,300 5,200 5,100 5,000 4,900 4,800 4,700 4,600 11/5 11/19 12/3 12/17 12/31 1/14 1/28 (IDR) 12,900 12,700 12,500 12,300 12,100 11,900 11,700 11,500 11,300 Chart 4. JCI performance (absolute vs. relative) (%, %p) Note: Relative to MSCI EM Index Absolute D 1W 1M 1Y Relative 14.4 Chart 5. Foreigner s net purchase (EM) Chart 6. Energy price (USDmn) 1,600 1,400 1,200 1, Note: The latest figure for India is February, 3 rd 1 Day 5 Days -7 1,337 Korea Taiwan Indonesia ThailandPhilippines India (USD/b) Brent (L) CPO(R) (USD) 90 2, ,400 2, , , , ,900 11/14 11/14 12/14 12/14 12/14 1/15 1/15 Chart 7. Non-ferrous metal price (D-3M=100) Copper Nickel Tin /14 12/14 1/15 2/15 Chart 8. Precious metal price Silver Gold Platinum /14 12/14 1/15 2/15 4

5 Table. Key valuation metrics Company Name BANKING Ticker Price Market Cap Price Performance (%) P/E(X)* P/B(X)* ROE(%)* (IDR) (IDRbn) 1D 1W 1M 1Y FY13 FY14 FY13 FY14 FY13 FY14 Bank Central Asia Tbk PT BBCA 13, , Bank Mandiri Persero Tbk PT BMRI 11, , Bank Rakyat Indonesia Persero Tbk PT BBRI 11, , Bank Negara Indonesia Persero Tbk PT BBNI 6, , Bank Danamon Indonesia Tbk PT BDMN 4,800 46, Bank Tabungan Pensiunan Nasional Tbk PT BTPN 4,100 23, PROPERTY Surya Semesta Internusa Tbk PT SSIA 1,125 5, Ciputra Property Tbk PT CTRP 825 5, N/A N/A Pakuwon Jati Tbk PT PWON , Alam Sutera Realty Tbk PT ASRI , Bumi Serpong Damai PT BSDE 2,045 37, CONSTRUCTION Total Bangun Persada Tbk PT TOTL 1,075 3, Adhi Karya Persero Tbk PT ADHI 3,410 6, Wijaya Karya Persero Tbk PT WIKA 3,655 22, Pembangunan Perumahan Persero Tbk PT PTPP 3,950 19, Waskita Karya Persero Tbk PT WSKT 1,770 17, RETAIL & CONSUMER Indofood Sukses Makmur Tbk PT INDF 7,500 65, Kalbe Farma Tbk PT KLBF 1,835 86, Mitra Adiperkasa Tbk PT MAPI 5,875 9, Unilever Indonesia Tbk PT UNVR 36, , Indofood CBP Sukses Makmur Tbk PT ICBP 14,100 82, Ramayana Lestari Sentosa Tbk PT RALS 830 5, Mayora Indah Tbk PT MYOR 25,000 22, Ace Hardware Indonesia Tbk PT ACES , Gudang Garam Tbk PT GGRM 55, , Nippon Indosari Corpindo Tbk PT ROTI 1,335 6, AUTOMOTIVE Astra International Tbk PT ASII 7, , Indomobil Sukses Internasional Tbk PT IMAS 4,000 11, Astra Otoparts Tbk PT AUTO 3,770 18, TELECOMMUNICATION Telekomunikasi Indonesia Persero Tbk PT TLKM 2, , XL Axiata Tbk PT EXCL 4,890 41, Indosat Tbk PT ISAT 4,005 21, INFRASTRUCTURE Jasa Marga Persero Tbk PT JSMR 7,125 48, Tower Bersama Infrastructure Tbk PT TBIG 9,450 45, MINING Aneka Tambang Persero Tbk PT ANTM 1,050 10, N/A Timah Persero Tbk PT TINS 1,135 8, Tambang Batubara Bukit Asam Persero Tbk PTBA 11,500 26, CEMENT Indocement Tunggal Prakarsa Tbk PT INTP 23,300 85, Holcim Indonesia Tbk PT SMCB 1,930 14, Semen Indonesia Persero Tbk PT SMGR 14,775 87, *Note: Valuation metrics based on Bloomberg consensus estimates 5

6 Sector performance Top 10 market cap performance Name Index Chg (%) Ticker Price Market Cap (IDRbn) Chg (%) Agricultural 2, SMMT IJ , Mining 1, EXCL IJ , Basic-Industry BYAN IJ , Miscellaneous Industry 1, PGAS IJ , Consumer Goods 2, MNCN IJ , Property & Construction BBCA IJ , Infrastructure 1, APLN IJ 473 9, Finance BJTM IJ 550 8, Trade SSIA IJ , Composite 5, SUPR IJ , Source: Bloomberg Top 5 leading movers Top 5 lagging movers Name Chg (%) Close Name Chg (%) Close BBCA IJ ,900 IIKP IJ ,760 PGAS IJ 3.4 5,375 BIRD IJ ,025 ASII IJ 1.3 7,725 ICBP IJ ,100 TLKM IJ 0.7 2,845 WIKA IJ ,655 EXCL IJ 5.1 4,890 LPPF IJ ,275 Source: Bloomberg Economic Calendar Time Currency Detail Forecast Previous 2:00am EUR German Factory Orders m/m 1.4% -2.4% 4:10am EUR Retail PMI :00am EUR EU Economic Forecasts Tentative EUR French 10-y Bond Auction :30am USD Challenger Job Cuts y/y 6.6% 8:30am USD Trade Balance -38.0B -39.0B 8:30am USD Unemployment Claims 277K 265K 8:30am USD Prelim Nonfarm Productivity q/q 0.9% 2.3% 8:30am USD Prelim Unit Labor Costs q/q 1.1% -1.0% 10:30am USD Natural Gas Storage -119B -94B Note: Time is based on Indonesian local time Source: Forex Factory Disclaimers This report is prepared strictly for private circulation only to clients of PT Daewoo Securities Indonesia (DWS). It is purposed only to person having professional experience in matters relating to investments. The information contained in this report has been taken from sources which we deem reliable. No warranty (express or implied) is made to the accuracy or completeness of the information. All opinions and estimates included in this report constitute our judgments as of this date, without regards to its fairness, and are subject to change without notice. However, none of DWS and/or its affiliated companies and/or their respective employees and/or agents makes any representation or warranty (express or implied) or accepts any responsibility or liability as to, or in relation to, the accuracy or completeness of the information and opinions contained in this report or as to any information contained in this report or any other such information or opinions remaining unchanged after the issue thereof. We expressly disclaim any responsibility or liability (express or implied) of DWS, its affiliated companies and their respective employees and agents whatsoever and howsoever arising (including, without limitation for any claims, proceedings, action, suits, losses, expenses, damages or costs) which may be brought against or suffered by any person as a results of acting in reliance upon the whole or any part of the contents of this report and neither DWS, its affiliated companies or their respective employees or agents accepts liability for any errors, omissions or misstatements, negligent or otherwise, in the report and any liability in respect of the report or any inaccuracy therein or omission there from which might otherwise arise is hereby expresses disclaimed. This document is not an offer to sell or a solicitation to buy any securities. This firms and its affiliates and their officers and employees may have a position, make markets, act as principal or engage in transaction in securities or related investments of any company mentioned herein, may perform services for or solicit business from any company mentioned herein, and may have acted upon or used any of the recommendations herein before they have been provided to you. PT Daewoo Securities Indonesia

Daily Focus. Indonesia. February 23, Growing fuel consumption

Daily Focus. Indonesia. February 23, Growing fuel consumption Indonesia Daily Focus Mimi Halimin +62-21-515-1141 mimi.halimin@dwsec-id.com For subscription of our Daily Focus, please contact us at research@dwsec-id.com Market Index Last Trade Chg (%) MoM YoY JCI