Equity SNAPSHOT Tuesday, December 04, 2018 Danareksa Sekuritas – Equity SNAPSHOT FROM EQUITY RESEARCH NFC: The digital trailblazer (NFCX IJ.NOT RATED) NFCX is a pioneer in the development of digital platforms with its profit-making telco pulsa/credit exchange. And through OONA TV, the company is a prospective force in media using the advertising Video on Demand (VOD) business model with low opex/capex. NFC’s products create uses for TSEL’s Tcash. Going forward, the company seeks to foster new partnerships and more digital projects. To see the full version of this report, please click here MARKET NEWS Macroeconomy PMI edges down in November Sector Consumer: Unilever Global acquire GSK in India Corporate Asset management acquisition: PNM and BTN still in the negotiation process Ciputra Development (CTRA) targets Rp1tn of marketing sales from Citra Maja Subang-Patimban Toll Road tender to be delayed United Tractors: Plans to spend capex of USD800mn Wijaya Karya: Targets IPOs for two of its subsidiaries in 2019 PREVIOUS REPORT Aneka Tambang: Strong sales volume boosted profit Click here Mayora Indah: Buoyant revenues but higher opex too Click here Construction: Deconstructing the sector Click here Timah: Higher costs dragged down net profit Click here Indosat Ooredoo: Takeaways from the 3Q18 con call; Ex-Java fever Click here KEY INDEX Close Chg Ytd Vol (%) (%) (US$ m) Asean - 5 Indonesia 6.118 1,0 (3,7) 606 Thailand 1.673 1,9 (4,6) 1.862 Philippines 7.533 2,2 (12,0) 177 Malaysia 1.700 1,2 (5,4) 1.094 Singapore 3.191 2,3 (6,2) 969 Regional China 2.655 2,6 (19,7) 22.613 Hong Kong 27.182 2,5 (9,1) 16.623 Japan 22.575 1,0 (0,8) 12.850 Korea 2.125 (0,3) (13,9) 6.581 Taiwan 10.138 2,5 (4,7) 5.439 India 36.241 0,1 6,4 399 NASDAQ 7.442 1,5 7,8 147.804 Dow Jones 25.826 1,1 4,5 13.890 CURRENCY AND INTEREST RATE Rate w-w m-m ytd (%) (%) (%) Rupiah Rp/1US$ 14.244 1,6 4,9 (5,1) SBI rate % 6,00 0,3 0,3 1,8 10y Gov Indo bond 7,83 (0,0) (0,5) 1,5 HARD COMMODITY Unit Price d-d m-m ytd (%) (%) (%) Coal US$/ton 102 (0,4) (0,9) 1,6 Gold US$/toz 1.231 0,0 (0,2) (5,5) Nickel US$/mt.ton 11.180 0,4 (5,7) (12,0) Tin US$/mt.ton 18.871 2,6 (1,3) (6,1) SOFT COMMODITY Unit Price d-d m-m ytd (%) (%) (%) Cocoa US$/mt.ton 2.155 1,1 (2,6) 13,5 Corn US$/mt.ton 137 1,8 2,7 9,1 Oil (WTI) US$/barrel 53 0,5 (15,7) (11,9) Oil (Brent) US$/barrel 62 3,8 (15,3) (7,7) Palm oil MYR/mt.ton 1.762 1,7 (13,3) (26,3) Rubber USd/kg 124 0,4 (1,5) (15,4) Pulp US$/tonne 1.205 N/A 2,8 20,5 Coffee US$/60kgbag 82 (0,0) (2,6) (9,0) Sugar US$/MT 350 0,6 (2,0) (11,2) Wheat US$/ton 142 1,1 (0,5) 5,7 Soy Oil US$/lb 28 1,8 0,4 (14,4) Soy Bean US$/by 906 1,2 3,5 (4,8)
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Equity SNAPSHOT Tuesday, December 04, 2018
Danareksa Sekuritas – Equity SNAPSHOT
FROM EQUITY RESEARCH
NFC: The digital trailblazer (NFCX IJ.NOT RATED) NFCX is a pioneer in the development of digital platforms with its profit-making telco pulsa/credit exchange. And through OONA TV, the company is a prospective force in media using the advertising Video on Demand (VOD) business model with low opex/capex. NFC’s products create uses for TSEL’s Tcash. Going forward, the company seeks to foster new partnerships and more digital projects. To see the full version of this report, please click here
MARKET NEWS
Macroeconomy PMI edges down in November
Sector
Consumer: Unilever Global acquire GSK in India Corporate
Asset management acquisition: PNM and BTN still in the negotiation process
Ciputra Development (CTRA) targets Rp1tn of marketing sales
from Citra Maja Subang-Patimban Toll Road tender to be delayed
United Tractors: Plans to spend capex of USD800mn Wijaya Karya: Targets IPOs for two of its subsidiaries in 2019
PREVIOUS REPORT
Aneka Tambang: Strong sales volume boosted profit Click here Mayora Indah: Buoyant revenues but higher opex too Click here Construction: Deconstructing the sector Click here Timah: Higher costs dragged down net profit Click here Indosat Ooredoo: Takeaways from the 3Q18 con call; Ex-Java
www.danareksa.com See important disclosure at the back of this report 1
Equity Research NFCX Company Update
Tuesday,4 December 2018
NFC (NFCX:IJ) Not Rated
The Digital Trailblazer
NFCX is a pioneer in the development of digital platforms with its profit-making telco pulsa/credit exchange. And through OONA TV, the company is a prospective force in media using the advertising Video on Demand (VOD) business model with low opex/capex. NFC’s products create uses for TSEL’s Tcash. Going forward, the company seeks to foster new partnerships and more digital projects. NFC’s asset light model will thrive on new digital initiatives. NFC has an asset-light model which seeks to exploit existing market imperfections by being more efficient among various ecosystems, essentially disrupting the status quo. NFC currently has three main products: 1) the telco pulsa exchange (which has been NFC’s revenues stream since FY15), 2) OONA TV VOD, and 3) DMS marketing solutions which are expected to start generating revenues in the coming months. NFC looks well placed to ride the digital wave on rising smartphone penetration and growing consumption. NFCXC.com marketplace for pulsa. In the pulsa marketplace, visibility can be limited at times leading to unexpected inventory excess and shortages for distributors. These agents deal with each other to optimize their positions. NFCXC.com is one of the few exchanges that helps aggregate inventory positions, and agent members in the exchange almost doubled over the last 3 months to 1,800 in Sep 18 from 918 in June 18. This helped both revenues and earnings to increase in 3Q18. OONA: Internet TV with intuitive digital marketing functionalities. OONA TV is an internet TV platform offering users a vast choice of channels with local and international content. In parallel, it scientifically identifies user needs and delivers digital advertisements in a more precise and targeted manner. Around the time of its IPO, Oona only had 20,000 subscribers, setting a target of 500,000 subs by YE18. As of October, Oona surpassed the initial target, with 1.2million subscribers of which 35% are active users. It is plausible that the company ends the year with 3 mn subs, according to our contact. The model is in pilot mode till it garners a sizable base with commercialization expected to commence in 2019. No debt exposure with a positive bottom line. Like Go-Jek, vendors and buyers meet in an online marketplace to trade goods & services to clear the market from idle capacity and demand. Based on this model, NFCXC can be very robust posting solid growth in 3Q18. After its IPO and raising Rp300 bn, NFC remains asset light and debt free offering leeway for OONA and other digital projects to develop traction and support the future valuation. NFCX is currently trading at PER-19 of 26.3x based on consensus earnings estimates.
PMI edges down in November In the PMI compiled by Nikkei Indonesia, the manufacturing index reached 50.4 in November 2018, slightly down
from its previous month’s level (50.5). In September 2018, Indonesia’s PMI reached its highest point in the past 26 months of 51.9. (Bisnis Indonesia)
SECTOR
Consumer: Unilever Global acquires GSK in India
Unilever Global has signed an agreement to acquire the Health Food Drinks portfolio of GlaxoSmithKline (GSK) in India, Bangladesh and 20 other predominantly Asian markets. Unilever’s share of the total consideration is EUR3.3bn
payable using a combination of cash and shares in its listed subsidiary in India, Hindustan Unilever Limited. The transaction consists of three elements:
- All-equity merger of Hindustan Unilever Ltd (HUL) with the publicly listed GSK Consumer Healthcare India (GSK CH India)
- Acquisition of an 82% stake in GSK Bangladesh Limited (GSK Bangladesh), and - Acquisition of certain other commercial operations and assets outside India
The transaction is aligned with Unilever’s stated strategy of increasing its presence in health-food businesses and in
high-growth emerging markets. GSK HDF is the undisputed leader in the Health Food Drinks category in India, with
iconic brands such as Horlicks and Boost. (Company)
CORPORATE Asset management acquisition: PNM and BTN still in the negotiation process
The acquisition plan of PT PNM Investment Management (PNM-IM)- the subsidiary of PT Permodalan Nasional
Madani (Persero)- by PT Bank Tabungan Negara (Persero) Tbk. (BBTN IJ, BUY, TP IDR3,600) reportedly still faces some hurdles related to the acquisition scheme, business combination and price negotiations. (Bisnis Indonesia)
Ciputra Development (CTRA) targets Rp1tn of marketing sales from Citra Maja
CTRA is targeting Rp1.0tn of marketing sales from Citra Maja. On 8-9 Dec, the company is planning to launch Cluster
Sanur and Cluster Jimbaran in Maja. There will be a total of 645 units in Cluster Sanur and 650 units in Cluster Jimbaran. The NUP for Cluster Sanur was reported to have reached 1,150 units. Targeted marketing sales for both
clusters is estimated at Rp125bn each. Both clusters offer units with prices ranging from Rp168mn-265mn/unit. (Kontan)
Subang-Patimban Toll Road tender to be delayed
The Indonesian government has announced that it will delay the Subang-Patimban Toll Road tender process to next
year, as the exact location has yet to be determined. The 41-km toll road was initiated by a consortium consisting of Jasa Marga (JSMR) and Surya Semesta Internusa (SSIA)
United Tractors: Plans to spend capex of USD800mn
United Tractors (UNTR) plans to spend capex of USD800mn in 2019, a slight increase from this year’s budgeted
capex of USD750mn. Most of the capex will be funded through bank loans. Meanwhile, with the recent correction in the coal price and with a coal price assumption of USD90/tonne, the company targets Komatsu sales volume of
around 4,900 – 5,000 units in 2019. (Investor Daily)
MARKET NEWS
Equity SNAPSHOT Tuesday, December 04, 2018
Danareksa Sekuritas – Equity SNAPSHOT
Wijaya Karya: Targets IPOs for two of its subsidiaries in 2019 Wijaya Karya (WIKA) seeks to raise around IDR4.0tn from the IPO of two subsidiaries in 2019: Wika Realty and
Wika Industri Konstruksi. Wika Realty is targeted to have an IPO after the presidential elections in 1H19, with
targeted proceeds of IDR2.0tn, while Wika Industri Konstruksi’s IPO is slated for 2H19 with targeted proceeds of IDR1.0-2.0tn. Wika Industri Konstruksi is engaged in industrial and steel manufacturing. Wika Industri Konstruksi
also produces electrical motors under the brand of Gesits. Previously, one of Wika Industri Konstruksi’s businesses was as the producer and supplier of motorcycle spare parts for Astra International (ASII). Furthermore, WIKA
remains optimistic it can achieve its 2018 new contracts target of IDR58tn. The company managed to book
IDR28.5tn of new contracts as of Oct 18, representing 49% of the full year target. WIKA targets 2019 new contracts of IDR70tn (+20.7%yoy). (Investor Daily)
Bank Central Asia BBCA 25.800 26.050 (1,0) 2,3 7,5 17,8 HOLD
Sources: Bloomberg
COVERAGE PERFORMANCE
Equity SNAPSHOT Tuesday, December 04, 2018
Danareksa Sekuritas – Equity SNAPSHOT
PREVIOUS REPORTS
Aneka Tambang: Strong sales volume boosted profit , Mayora Indah: Buoyant revenues but higher opex too
SnapShot20181203 Construction: Deconstructing the sector SnapShot20181130
Timah: Higher costs dragged down net profit SnapShot20181129 Indosat Ooredoo: Takeaways from the 3Q18 con call; Ex-Java fever SnapShot20181128
Indofood Sukses Makmur: Positive catalysts, Plantation: Indonesia CPO Export Levy Waiver: A Double-Edged Sword?, Danareksa Research Institute – Inflation Outlook SnapShot20181127
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