Market Flash: iSHARES MSCI Indonesia Investable Market Index Fund (EIDO:US) PRICE: 28.530 USD Down -0.360 (-1.246%) >>> BI: Rupiah Melemah Akibat Kondisi Eropa >>> Pertemuan FED pertimbangkan langkah baru dorong ekonomi >>> KIJA akan Terbitkan MEN Valas USD150 Juta >>> PT Indika Energy Perusahaan Teladan Dunia 2011 >>> Govt Promises Revision of Cost Recovery Regulation >>> BPMigas Demands PGN to Pay US$6 per MMBTU >>> Jababeka to Raise US$150 Million from Debt Markets >>> SCG Chemicals buys Chandra Asri >>> Solusi Tunas eyes Rp380 bio IPO >>> SMR Utama scouts Rp300 bio IPO >>> Alam Sutera picks two bond arrangers >>> ASII Tetap Rajai Penjualan Mobil Agustus 2011 >>> Perusahaan Thailand kuasai Saham TPIA senilai Rp 3,76 Triliun >>> Agis Main ke Tambang, Sahamnya Masuk Dalam Pengawasan >>> ACES Mendekati The Northern Agar Mau Kurangi Kepemilikan >>> IHSG masih harus berjuang terus bertahan diatas MA200 >>> Melirik Peluang Akumulasi di Saham Perbankan >>> Analisa Saham BUMI: Kuat Bertahan & Berpeluang Kembali Uptrend >>> Analisa Saham JSMR: Bertahan Di Support, What Next? >>> INDF Tertahan Di Area Support Kuat, Berpeluang Rebound >>> ASII Break Minor Support, Sell on Strength >>> ADRO Membentuk Descending Wedges, Berpeluang Rebound Terbatas >>> Wall Street ends flat as early gains evaporate >>> Fed begins policy meeting, tiptoes toward easing >>> Fed meeting to help decide on long-term Treasuries >>> Greece Makes 'Good Progress' in Reform Talks: EC >>> China worried Europe debt crisis will hit trade >>> China could roll out 4.65tr yuan stimulus package >>> IMF sees Mideast stagnation >>> NYMEX-Crude ends higher at Oct contract expiry >>> Asian Crude Palm Oil Up On Technical Buying, Soyoil >>> Foreign net Sell - 61.785.746

Rabu, 10 Juli 2013

Rothschild Seeks Regulator Probe on Bumi False Statement Claim

By Jesse Riseborough - Jul 8, 2013 5:37 PM GMT+0700
Nathaniel Rothschild, the financier who co-founded Bumi Plc, asked the U.K.’s financial regulator to investigate whether the Indonesian coal producer made misleading statements about a proposed deal with the Bakrie Group.
Rothschild’s claim centers around Bumi’s delayed plan to unwind its 29 percent investment in PT Bumi Resources (BUMI) and separate from co-founders the Bakrie family in a cash-and-share deal, according to a copy of a July 4 letter sent by Rothschild’s lawyers to the Financial Conduct Authority and seen by Bloomberg News. A Bumi spokesman declined to comment.
Rothschild claims Bumi and the Bakrie Group “issued a series of choreographed announcements which created a misleading impression as to the terms of the separation,” the letter shows. They then “relied on the misleading characterization of the benefits” of the deal to influence shareholders to vote against resolutions put forward by Rothschild at a February extraordinary general meeting, it said.
Bumi has been at the center of a battle for control between co-founders Rothschild, 41, and the Bakries since the $3 billion deal that brought them together started to sour in late 2011. Waning coal prices, board infighting and probes in the U.K. and Indonesia have weighed on the stock, which plunged 69 percent in London last year. The shares have been suspended from trading since April.
A deal to separate from the Bakries announced in October, which results in the Bakries canceling their stake in London-listed Bumi and buying back their holding in PT Bumi, has yet to be completed. Bumi Chief Executive Officer Nick von Schirnding said last month the deal was still being worked on and he was “confident we are nearing the end of this process.”

Thaksin Shinawatra

Former Thai Prime Minister Thaksin Shinawatra is in talks to buy the Bakrie family’s 23.8 percent stake in Bumi, the Sunday Times reported yesterday, without saying where it got the information. A Bumi spokesman declined to comment on the report, which said Shinawatra had hired UBS AG to advise him.
The Bakries have the full amount of funds available to complete the deal and were waiting to hear from the board of Bumi on “how they wish to proceed,” according to a statement last month. A London-based spokesman for the Bakrie Group declined to comment today.
According to the letter to the U.K.’s FCA, Rothschild is concerned a $50 million payment from the Bakries held in escrow will be returned should they withdraw from the deal. In the week leading up to the February shareholder meeting, at which Rothschild sought to remove 12 of the 14 directors, the CEO and Chairman Samin Tan confirmed the terms of the Bakrie deal were fixed, according to the letter.

Invites Probe

“The question therefore arises whether false or misleading statements have been made to the market,” Rothschild’s lawyers wrote, adding that their client invites the FCA to investigate.
The creation of Bumi brought together Rothschild and the Bakries, a family-owned palm oil-to-property empire founded in Sumatra in 1942. Bumi and the Bakries announced a deal to unwind their investment in October that involved the Bakries exchanging their 23.8 percent of Bumi Plc (BUMI) for 29.2 percent of Bumi Resources in a cash-and-share-swap deal, leaving Bumi Plc in control of Berau Coal.
Rothschild left the board of Bumi in October, saying he’d lost confidence in its ability and vowing to fight “from outside the tent.” He retains a stake of about 15 percent, according to data compiled by Bloomberg.
To contact the reporter on this story: Jesse Riseborough in London at jriseborough@bloomberg.net

Kamis, 23 Mei 2013

UK lawmakers consider probe into transparency of mining firms

UK lawmakers consider probe into transparency of mining firms

Sun, May 19 11:29 AM EDT
* Committee to consider proposed inquiry on Tuesday

* ENRC, Bumi among those expected to testify

By Clara Ferreira-Marques

LONDON, May 19 (Reuters) - Britain's parliament will this week consider whether to probe the transparency of oil and mining firms listed in London, an issue highlighted by corruption probes at emerging market miners which lawmakers fear have dented the stock market's reputation.

The chairman of parliament's Committee for Business, Innovation and Skills said on Sunday he would this week propose an inquiry into issues including governance and anticorruption protection at mining and oil companies.

The probe could start before the end of the parliamentary session in July. The committee will, though, have to decide the specific terms of the inquiry.

Parliamentarian Adrian Bailey said those set to give evidence are expected to include executives from Kazakh miner ENRC and Indonesia-focused miner Bumi, both facing corruption probes that have hit already beleaguered shares. The banks that advised the two could also be called.

He said the committee had already been considering a look at the extractive industries but the current turmoil around ENRC - now facing a buyout bid from its founders that would take it private after just over five years - had given the inquiry "added significance".

"We will be looking at the issue of transparency in general. It is not an inquiry looking into just ENRC and Bumi," Bailey said, adding that the concerns raised by those two miners would, however, be central.

"We have not yet defined the focus of the inquiry, or indeed decided whether we are going ahead."

Parliamentary committees often bring political pressure to bear on companies by publishing reports and calling witnesses to evidence sessions. While their reports have no legislative weight, findings are aimed at influencing government policy.

SPOTLIGHT

Given the spotlight on London's reputation in recent months, the inquiry is widely expected to go ahead and could, among other things, look at the benefit of having major extractive companies listed in London.

It would also look at whether Britain should sign up to the Extractive Industries Transparency Initiative (EITI) as well as examining mining and oil companies' roles in communities and their environmental efforts.

The EITI, supported by the World Bank, was set up to improve transparency and accountability in countries rich in mineral resources.

Troubles at ENRC, the largest of the companies in question, have made it the focus of headlines and a fierce debate around foreign resources companies with majority owners. Boardroom battles and corruption probes have helped drag its share down more than 50 percent since the start of last year alone.

Indonesia-focused miner Bumi has been another listing troubled from the start. Corruption probes and a damaging shareholder battle between the founders - Indonesia's powerful Bakrie family and financier Nat Rothschild - have added to low coal prices, dragging the shares down almost 80 percent since its listing.

But Bumi and ENRC are only two of a clutch of foreign-owned resource companies that have listed in London in the past decade, transforming the once UK-focused bluechip FTSE index.

Scandals at both have overshadowed some of the successful listings, prompting questions over governance, the number of shares that should be required to be freely available for purchase and the role of willing bankers. The UK Listings Authority has proposed tighter entry rules, hoping to create a higher hurdle for companies wanting to access the London market.

The revised rules, on which it consulted with the market last year, could be published in the coming weeks.


me @ LOTS Trading Club (LTC)

Selasa, 16 April 2013

ASRI key takeaways from meeting

We attend Alam Sutera (ASRI IJ) analyst meeting yesterday. And the key takeaways are as follow:
 
Positive on 2013 outlook. The company is optimist with 2013 property outlook as they target to get marketing sales of IDR5.6trn, still mainly contributed from Serpong sales. With the land supply becoming limited in serpong area, price still expected to increase by 20% this year. Current land ASP from the latest launch, sutera palmyra on January and sutera victoria on February is offered at IDR 11m/sq m and IDR14m/ sq m, respectively.
 
Landbanking the north Serpong. With additional 170ha land acquired from Modernland, the company currently has in total  270ha landbank in North Serpong. The company indicated they can acquired 50ha more in the same areas. Acquisition cost range between IDR1.2-1.6m/sqm. With development cost is around IDR500K/sq m, gross margin from land sales should be maintained at more than 60%.
 
Suvarna sutera price to appreciate by 25%. The management plan to launch at least 4 new cluster. March pre-sales of IDR455bn is mainly contribute by launching in Pasar Kemis. The latest soft launch absorbed 70% take up rate. Management expect price to increase 25% this year from current asp of IDR3.2-3.3m/sq m (golf view) and IDR2.1-2.6m/sq m (non-golf view).
 
Update on GWK Bali. As acquisition process is completed in July 2012, the future recurring income is finalizing the masterplan where construction would take part by end of 2013. Capex for the GWK project for the next 3 years expected to reach IDR450bn and will be financed through internal cash or pre-sales.
 
USD Bonds II amounting USD235m. The company recently issued USD bond through its subsidiary (Alam Synergy Pte.Ltd) The coupon rate is 6.95% and will be marture in 2020. 40% of the proceeds will be used to repay company’s bank debt, 40% for land acquisition and 20% for working capital. The company plans to hedge the bonds principal where hedging cost is around 1.1%. The coupon itself will not be hedge but company will allocated its cash off around USD32m (or four times coupon payment) to secure the coupon payment.
 
NAV as of March 31,2013 of IDR36trn. 57% of the values still lies in its landbank in Serpong (excluding 150ha land acquired from Modernland), followed by landbank value in Pasar Kemis of IDR8.8trn (24% of NAV). The company new NAV is equivalent to IDR1,839/share. The counter is currently trading at 45% discount to company’s NAV. We will review our Target Price as we have yet take into account GWK projects, CBD office and new landbank from Modernland into our NAV calculation. But maintain our forecast with company to post net earnings growth of 39-18% for FY13-14f. BUY.
me @ LOTS Trading Club (LTC)

Senin, 18 Maret 2013

ANTM has booked Rp2.9tn FY12 net income (+55.3% yoy, +1458.2% qoq), above consensus’ estimates (278.2%). Albeit the in-line revenue to operating income compared to consensus, gain from value adjustment under other income boosted the company’s bottom line by Rp2.5tn.

*  Gross and operating profits both declined due to rising mining operation costs as a result of continuing R&D for production while ASP decreased.

*  Ferronickel production declined by 6.69% in FY12 to 18,372 tni while its sales remained relatively flat at 19,527 tni from 19,530 tni in 2011. With an ASP of USD7.73/lb, ferronickel sales came up to be Rp3.14tn last year.

*  Nickel ore sales was recorded at Rp3.07tn which grew by 24.8% yoy due to increase in production volume. Total production rose to 6.47mn wmt while sales increased to 8mn wmt.

*  Gold sales, recorded at 7,024 kg, went above ANTM’s target of 7,009 kg although production was only at 2,849 kg vs the target of 3,000 kg. Gold sales thus was recorded at Rp3.63tn in FY12. This year, ANTM targets gold production volume of 3,316 kg and sales of 7,601 kg boosted by the production hike in Pongkor.

*  We are currently reviewing our model to reflect the most updated numbers. ANTM is currently trading at 10.57-11.71x PE13-14F.
me @ LOTS Trading Club (LTC)

Jumat, 22 Februari 2013

RALS - Cheapest play in the department store space

Unaudited FY12 NPAT was weak but expected. It would have been 12-15% higher if the supermarket delivered. Margin enhancement and strong wage hike would be the catalysts. We reiterate BUY. Valuation re-rating in the department stores space could catalyze RALS as the cheapest play.

Weak FY12 NPAT is expected. RALS will report audited FY12 results in end-March. Unaudited NPAT was revealed at Rp424bn (+12.3%yoy), 11% lower than our previous estimates and 5% lower than consensus.

We have fine-tuned our numbers to factor these. Weak NPAT came as supermarket booked some Rp15bn net loss versus Rp40-50bn profit targeted. Consolidated NPAT would have been 12-15% higher if supermarket division met the management's budget.

Record high productivity indeed. 2012 sales/sqm reached Rp8.0mn (+4.4%yoy), a historic high. The decision to replace some supermarket space with the fashion consignment products enhanced productivity. SSSG recovered to 8.8% from 5.0% in 2011, albeit slightly lower than our expectation.

Margin enhancement to continue. Core department stores business performed very well last year. Its EBIT margin could reach c.11% in FY12, higher than MAPI. As consignment proportion rises, the gradual operating margin improvement should continue going forward. Fashion consignment can generate 3-6ppt higher operating margin than outright.

RALS expects fashion consignment proportion to reach up to 35% this year, versus 30.6% in FY12. For department stores alone, consignment proportion is 50%, far below MAPIs department stores (~80%) and LPPFs (~70%), suggesting ample room for operating margin improvement.

Recent hire of an operational manager for the supermarket division, rather than a top-level guy, should also be more effective in addressing the core issues of the business.

Take a more conservative approach. 2013 strong minimum wage hike would benefit RALS. If adjustments are smooth, RALS indicated that achieving Rp550bn FY13F NPAT (8.8% above consensus) is possible. But we decided to be conservative as some deferment in wage adjustments is possible as hundreds of companies are applying for excemption from the wage hike.

We slashed FY13F EPS by 5.9%, factoring higher wages and electricity costs, now aligned with the street.
Reiterate BUY with unchanged TP at Rp1,400 still pegged to 1.0x PEG. Current 16.2x FY13F PE makes RALS an underdog against regional average of 26.2x or even local peers at 30.4x.

Valuation re-rating in the department stores space could catalyze RALS as the cheapest play. On a 12-month forward, RALS 16x PE is also on par with its mean. A discount to execution risk is understandable, but not this high.
me @ LOTS Trading Club (LTC)

Selasa, 19 Februari 2013

Bakrie vs Rothschild: Potential Mandatory Tender Offer US$8bn?

· What happen?
Local newspaper quoting from Bakrie Group key spokeperson, Christopher Fong, highlighted that if somehow Rothschild won the EGM on 21 Feb 2012 and replace the existing 12 boards of Directors in Bumi Plc, meaning that the Bakrie Separation Agreement signed last week has been breached and Bakrie Group would take a legal action to the Indonesia Financial Services Authority (OJK) which the new board members of Bumi Plc  will face a potential  Mandatory Tender Offer (MTO) if Nat’s proposal passed.

· How possible US$8bn cash offer?
Mr Fong reiterates that based on Indonesia’s capital market regulation, if there’s a change in majority shareholders in Bumi Resources (BUMI IJ), then Bumi Plc will subject to MTO and has to pay US$4bn of 70% of BUMI IJ floating shares and US$4bn debt in BUMI IJ, as creditor has the priority to be paid off if there’s change in majority share/stake holders (based on general financial covenant in banking). BRAU IJ tender offer occurred in 2011 at Rp540/share when Vallar acquired the majority stake.

· Comment:
This is a valid reason in our view, considering Bakrie Group has a strong network access to Indonesia capital market regulators. In addition, political wise Indonesia regulators or Government will unlikely let one of the largest Indonesia coal assets, KPC and Arutmin (CCoW 1st Gen), controlled by foreign Investor which against the New Mining Law 4/2009 as it also subject to foreign ownership divestment clause as well. So from here, BUMI IJ stock may look attractive for trading idea.

me @ LOTS Trading Club (LTC)

Senin, 18 Februari 2013

KZ - SMGR gains more market share

·         Jan domestic cement sales was at 4.65m tonnes, down 9.1% MoM, up 14.5%YoY. The increase in YoY figure is encouraging, cementing our view on rising trend demand. Historically, January and 1Q are usually a weaker period,  representing around 8% and 22% of full year domestic sale, respectively.
·         Export market only contributes 0.4% of total national cement sales.
·         SMGR gained market share at the expense of INTP and SMCB:
§         SMGR continued to gain market share due to more capacity (operational of Tuban IV on July 2012 and Tonasa V plant on late 2012): 43.9%, from 42.1% in 4Q12.
§         INTP market share declined to 30.1% (from 31.4% in 4Q12), while SMCB market share declined to 14.8% (from 15.1% in 4Q12).
·         We expect 12% volume growth for FY13; in line with Cement Association’ expectation.  This implies the players running at 93-94% utilization rate. Still a very tight market. We expect ASP to rise 4-5% this year.
·         INTP is now trading at 14x PE13, SMGR at 18.3x PE13, and SMCB 16.7x PE13. We are reviewing our SMGR assumptions post additional capacity from Thang Long and the newly commissioned Tonasa V.
me @ LOTS Trading Club (LTC)

Jumat, 15 Februari 2013

RALS - Cheapest play in the department store space

Unaudited FY12 NPAT was weak but expected. It would have been 12-15% higher if the supermarket delivered. Margin enhancement and strong wage hike would be the catalysts. We reiterate BUY. Valuation re-rating in the department stores space could catalyze RALS as the cheapest play.

Weak FY12 NPAT is expected. RALS will report audited FY12 results in end-March. Unaudited NPAT was revealed at Rp424bn (+12.3%yoy), 11% lower than our previous estimates and 5% lower than consensus.

We have fine-tuned our numbers to factor these. Weak NPAT came as supermarket booked some Rp15bn net loss versus Rp40-50bn profit targeted. Consolidated NPAT would have been 12-15% higher if supermarket division met the management's budget.

Record high productivity indeed. 2012 sales/sqm reached Rp8.0mn (+4.4%yoy), a historic high. The decision to replace some supermarket space with the fashion consignment products enhanced productivity. SSSG recovered to 8.8% from 5.0% in 2011, albeit slightly lower than our expectation.

Margin enhancement to continue. Core department stores business performed very well last year. Its EBIT margin could reach c.11% in FY12, higher than MAPI. As consignment proportion rises, the gradual operating margin improvement should continue going forward. Fashion consignment can generate 3-6ppt higher operating margin than outright.

RALS expects fashion consignment proportion to reach up to 35% this year, versus 30.6% in FY12. For department stores alone, consignment proportion is 50%, far below MAPIs department stores (~80%) and LPPFs (~70%), suggesting ample room for operating margin improvement.

Recent hire of an operational manager for the supermarket division, rather than a top-level guy, should also be more effective in addressing the core issues of the business.

Take a more conservative approach. 2013 strong minimum wage hike would benefit RALS. If adjustments are smooth, RALS indicated that achieving Rp550bn FY13F NPAT (8.8% above consensus) is possible. But we decided to be conservative as some deferment in wage adjustments is possible as hundreds of companies are applying for excemption from the wage hike.

We slashed FY13F EPS by 5.9%, factoring higher wages and electricity costs, now aligned with the street.
Reiterate BUY with unchanged TP at Rp1,400 still pegged to 1.0x PEG. Current 16.2x FY13F PE makes RALS an underdog against regional average of 26.2x or even local peers at 30.4x.

Valuation re-rating in the department stores space could catalyze RALS as the cheapest play. On a 12-month forward, RALS 16x PE is also on par with its mean. A discount to execution risk is understandable, but not this high.
me @ LOTS Trading Club (LTC)
Bakrie Group and Bumi PLC agreed on heads of agreement for separation. Based on the agreement, $278m will have to be paid in cash within 5 days following the signing of the agreement, $50 of which would have to be deposited in an escrow by 15/2.

Comments:

$278 in cash reflects Rp 680/sh and is only for around 19% of the group’s 29.2% holding. Details of at what price and method of payment for the remaining percentage is still forthcoming. The vote will be done on Feb 21, 2013.

Kamis, 14 Februari 2013

KZ - INDY Downgrade to Sell

    INDY’s overhead costs are ballooning. Overhead is 21% of revenue and has grown 45% CAGR from 2010 to 2012. The main driver is salary which takes up nearly 33% of all overhead cost.
·         While we view recent bond issuance as positive (lowering overall borrowing cost from 8.5% to 6.6%), the main overhang is bloated costs, not interest expense
·         As a result of this high overhead cost, earnings are sensitive to changes in revenue. Lowering INDY’s revenue by 6% (from PTRO and MBSS), INDY’s earnings plunged by 40% in 13CL to $42m.
·         As an aside, we don’t think that MTU, INDY’s recent acquisition, may not be able to start before 2015 due to legal concerns.
·         We prefer MBSS and PTRO because of their earnings visibility and cheap valuation. MBSS (PE 4.8x 13CL) and PTRO (PE 4.6x 13CL)
·         As a result we downgrade INDY to Sell from O-PF.  Our sum of the parts valuation results in a change in target price to Rp1,360 per share from Rp1,580 per share
me @ LOTS Trading Club (LTC)
Garuda Indonesia
Overall figures in line

Expansion stayed on track as GIAA increased its fleet to 106 aircraft. Furthermore, the utilization rate remained solid as the SLF and utilization numbers were strong despite the higher capacity. Fuel costs – which constitute the largest chunk of GIAA’s total costs – only inched up 1% YoY, or as expected. Overall, we remain upbeat on
the company. BUY maintained with a TP of Rp940, implying FY13 EV/EBITDAR of 4.95x.

Expansion on track with 106 aircraft in its fleet

GIAA had 106 aircraft in its fleet at the end of December 2012 (one more than we had estimated earlier this year), as the company added 22 new aircraft whilst getting rid of three. The additional aircraft were deployed on short to medium haul routes and comprised of A330-200, B737-800 NG, CRJ 1000 NG and A320-200 for Citilink. In an effort to leverage its fleet, GIAA made some changes to its routes (see exhibit 3). This, in turn, boosted its flight frequency figure by 17.9% YoY to 153,266 at the end of December 2012. The overall capacity, meanwhile, climbed 10.9% YoY to 36,014 mn km in FY12 - or in line with our full year estimate.

Better utilization rate with the highest passengers carried growth of 76% YoY coming from
Citilink

Despite the higher capacity, GIAA still posted better RPK as the SLF and aircraft utilization remained strong. The overall SLF inched up 0.68% YoY in FY12 as the total number of passengers carried continued it double-digit growth. The highest growth came from Citilink which posted a 76% YoY increase in passengers carried during the year to 2,861 thousand in FY12 - albeit falling short of our estimate. However, as Citilink contributed less than the other segments, the overall passengers carried remained in line with our full year forecast.

Fuel costs up slightly by 1% YoY - as expected

Crude oil prices were volatile throughout the year but exhibited a slight upward trend (+0.5% from early 2012), thereby impacting the jet fuel price which rose 2% from early 2012 (please see exhibit 6). As fuel costs account for more than 30% of the total costs, the volatility in prices has a direct
impact on the bottom line. Based on our sensitivity analysis, a 5% change in the jet fuel price results in an 11% change in the FY12 EBITDAR. In FY12, GIAA’s average jet fuel price was USc 91/liter, up only 1% YoY, or pretty much in line with our jet fuel price assumption.

me @ LOTS Trading Club (LTC)

Indofood CBP - New noodle and snack flavours launched

Indofood CBP - New noodle and snack flavours launched

 ● Indofood CBP (ICBP) is starting the year with new variant launches of instant noodles and snack products. In instant noodle Sarimi Isi 2, ICBP launched new flavors—Soto Koya (from East Java) and Goreng Kremes (fried noodle). In addition, it also launched value-for-money Sarimi Gelas, a smaller size instant noodle (35 g) that can be consumed conveniently from a glass/cup.

 ● Within its snack division, a new flavour is launched under the already successful Qtela Tempe Chips—Cabai Rawit (spicy) flavor.
 
 ● Noodle is the largest division of ICBP, accounting for 64% and 79% of 2013E revenue and operating profit while the snack division is smaller, accounting for 8% of 2013E revenue and 5% of operating profit. Despite its smaller size, snack division growth has been quite promising—27% CAGR in revenue-terms 2010- 13E and 39% CAGR in operating profit 2010-13E.

● We continue to like Indofood CBP for its continuous innovative products strategy. We maintain our OUTPERFORM rating with target price of Rp8,100, implying 18.6x 2013E P/E.
me @ LOTS Trading Club (LTC)

Rabu, 13 Februari 2013

Bank Rakyat Indonesia ( Persero ) (BBRI.JK)

Bank Rakyat Indonesia ( Persero ) (BBRI.JK)
Q4 CY12 Result Preview: Key Will Be Micro Business Trend

Earnings to depend on credit and opex costs —

With strong 11M net profit of Rp16.4trn reported on BI’s website, CY12 profit is likely to exceed Citi’s forecast of Rp16.7trn (consensus is Rp17trn). The share price, in our opinion, will be driven more by trends in the Micro business (both loan growth as well as yields). Analyst meeting is scheduled for Jan 31, 2013 evening (Thursday) and financial statements will be published in Friday’s newspapers.

Citi Q4 PPOP of Rp4.6trn (-16% qoq) and NP of Rp3.5trn (-21% qoq) —

Our forecasts are based on NIM contraction, a seasonal jump in opex and higher credit costs. NIM contraction is due to lower loan yields (20bps) and higher proportion of low yield assets due to year end deposit flow. Our 12M opex growth is estimated at
17% and 12M credit cost at 0.35% (net of cash recovery of Rp2trn). Upside surprises could come from higher trading, other operating and non-operating
income (details in Fig. 1)

Micro loan trends —

Micro loan disbursements have picked up from March 2012,
with net increases of Rp4.8trn in Q2 and Rp4.5trn in Q3. Mgmt indication of 18% growth (end 2012) equates to c~Rp5.3trn disbursement in Q4. The Q4 run rate would translate into 20% growth in 2013F.

Selasa, 29 Januari 2013

Indonesian coal Low rank ban proposal scrapped


Event
§ Indonesia's Energy and Minerals Resources Ministry (ESDM) has scrapped its proposed 2014 ban on low rank coal, according to a Bloomberg report (24 January, 2013), quoting ESDM's coal-business director, Edi Prasodjo. The key reasons cited for the scrapping of the proposal were: 1) the lack of
commercially viable technology for upgrading low rank coal; and 2) lack of domestic demand to absorb excess (low rank production.

Impact

§ Outcome consistent with expectations. The outcome is consistent with our (and market) expectations; however an actual decision was not flagged prior
to the announcement. The ruling is consistent with our view the government is looking to restore confidence in the sector from a regulatory perspective and
that proposed regulations are typically either watered down or fail to be implemented altogether - the proposed coal export tax a key example.

§ Nationalistic regulatory concerns to remain ahead of 2014 election. We expect regulatory concerns to remain leading up to the 2014 election, given rising resource nationalism reflected by the 2012 foreign divestment regulation. Another area of uncertainty remains the terms for converting CCoW concessions to IUP concessions in relation to royalties, tax rates and other key operational requirements for coal producers.
§ Listed coal sector mostly locally-owned. We note most of the listed coal producers are locally owned, limiting the direct impact of nationalistic policy
changes. ITMG is the only major foreign-owned coal producer (65% owned by BANPU), however its local listing and local investor (PMDN) status further
adds to confusion of whether it is actually deemed a foreign entity for the purposes of the foreign divestment regulation.

§ Decision positive for sentiment, but investor focus still on pricing.
Naturally, we expect the market to react incrementally positively to the news; however, the primary focus we believe will remain on the pricing outlook for
seaborne coal, and more specifically China demand. We maintain a cautious view on the sector given supply remains strong relative to demand growth as reflected in our US$90/t 2013 Newcastle Benchmark price (v US$94/t on the forward curve).

§ Buy low cost producers, PTBA top pick. We continue to prefer low cost producers with strong balance sheets given the potential for prices to remain
rangebound. PTBA is therefore our top pick, trading at 11.3x FY13E PER (ex cash), benefitting from strong 3yr production CAGR of 20%, strong domestic
exposure (~55%), 2bt reserves, strong balance sheet and M&A potential. Importantly, recent visits to Indonesian coal mines earlier this week suggest inventories have declined sharply since 4Q12, helping to restore a tighter
supply/demand balance heading into 2013.


me @ LOTS Trading Club (LTC)

Senin, 28 Januari 2013

Bumi Resources (BUMI IJ) by Jayden V

Bumi Resources (BUMI IJ) by Jayden V

·         Indonesia's most newsworthy coal producer Bumi Resources (BUMI IJ), presented at the CLSA's ASEAN access days in Singapore and Hong Kong.
·         In 2012, the ASP for their 68mt coal sales was US$82/t and in 2013 their budgeted ASP is between US$70/t to US$85/t in a bull case scenario assuming Newcastle rebounds to US$110/t. They expect c. 10% production growth in 2013 (lower than previous 2 years) as the focus is now on cost savings and deferring capex.
·         Operationally, the group is experiencing cash costs of US$45/t but hopes to cut the strip ratio from ~10.8bcm/t in 2012 down to ~10bcm/t saving about US$2.5/t. This means Ebit margins of c. US$20/t after factoring in depreciation. Fuel costs (28-30% of its COGS) remains a concern as they're stubbornly high.
·         The key question though is what they will do to delever (the group has US$4.2b net debt on its balance sheet with US$50m cash) and what is happening with the Rothschild/Bakrie divorce at the plc level. Dileep said asset sales of the mineral (BRMS assets) will occur after all the plc issues are resolved (though he was unsure on timing) as it will impact the price realised on asset sales. Asset sales remain the preferred method of raising cash to delever.
·         In our view, the stock is a leveraged play on the value of the BRMS assets and any upside for investors hinges upon the timing and price of these sales. Given CLSA's coal price downgrade this week to US$90/t for 2014, the cashflow generated from the coal assets KPC and Arutmin will also be lower than previous years in our forecast.

me @ LOTS Trading Club (LTC)

Wismilak Inti Makmur

Wismilak Inti Makmur
Attempting a high jump

§        Excise tax hurdle: Indonesia’s tobacco industry is in the process of converging its excise tax across every type of cigarettes (exhibit 7). The implication of this event is that smaller producers’ excise tax is increasing at a faster rate than larger producers’ excise tax. Wismilak Inti Makmur (WIIM), with 1% market share in 2011, is one of those small producers which are attempting to jump the tier “hurdle” in order to minimize the excise duty hike effect.

The company started its operation in 1963 through its current subsidiary, Gelora Djaja, which handles the production side of the business. In 1983, WIIM incorporated Gawih Jaya to distribute a part of the business before restructuring both Gelora and Gawih under Wismilak Inti Makmur (WIIM) in 1994 (exhibit 6). Run by 3 families: Walla, Widjajadi and Winarko, WIIM derives most of its revenue from machine rolled cigarettes (SKM), which accounted for 80% of 2011 total revenue.

§        10% higher than expected 2012 net profit due to Mild Diplomat: In 2012, WIIM has indicated net profit of IDR74-75b, some 10% higher than its estimate at the IPO of IDR67b.

This is helped by higher than expected price increase and volume growth of Mild Diplomat, newly launched in mid-2012, mainly in Central and East Java.

 In 2013, WIIM, betting on the continued success of Mild Diplomat, plans to jump over the 2b total production mark, partly also supported by distribution network expansion.

The company targets 2013 total production of 2.5b sticks, up from around 2b sticks in 2012, translating to top line level of IDR1.5-1.6t (2012: more than IDR1.1t) helped by blended ASP increase of about 8%.

On 2013 bottom line, WIIM expects to book IDR120b, up more than 60% y-y, propelled by operating leverage from G&A cost and lower net interest expense from its IDR409b (USD43m) IPO proceeds.

§        Further growth from added distribution network & capacity: WIIM currently operates 17 branches, 5 stock points and 29 agents to cover the whole nation. North Sumatra, East Java and Central Java are WIIM’s major markets, although there are plans to further expand its distribution network outside these areas.

On capacity, the company separates the lines into SKM (machine rolled) and SKT (hand rolled) with each divided again into regular and mild products (exhibit 9-10). WIIM operates production capacity of 2.5b sticks in 2011 with 434m sticks for SKT and 2b sticks for SKM. In 2012, the company added its SKM capacity to 2.5b sticks, before adding 1.2b capacity in 2013 (equipment to arrive in mid-2013).

Outlook & valuation:
A growth driven counter – cheap on PEG: Given WIIM’s better than expected 2012 results, we see potential share price upside, particularly if the company can continue to surpass its targets in 2013.

On valuation, WIIM is on 2013 PE of 12.6x (20% discount to the market), reflecting cheap PEG of 0.2x. Thus, we expect WIIM’s out-performance since IPO (exhibit 5) to persist, backed by subdued inflation this year coupled with increased smokers’ purchasing power stemming from higher wages.

Bottom line growth, however, is subject to the strength of WIIM’s brand equity when raising its products prices in tandem with its higher-up excise tax tier.

WIIM’s other challenges will be the government’s tighter limitation on cigarette marketing as well as competition from its peers.

me @ LOTS Trading Club (LTC)

Senin, 07 Januari 2013

Lautandhana Targets IDR2 Trillion Assets Under Management in 2013

PT Lautandhana Investment Management is targeting to manage IDR2 trillion assets this year, by launching four new mutual funds in 2Q/2013. Director of Investment Management Lautandhana Grace Wiragesang said assets under management this year is targeted to increase approximately 33% to IDR2 trillion from last year which was stood at around IDR1.5 trillion.

“Assets under management target in 2013 is approximately IDR2 trillion, from IDR1.5 trillion. If we calculated the increase is not IDR500 billion, but it is likely around IDR850 billion as we have any payment for our protected mutual funds," she told the business.

She said the target will be obtained by launching four new mutual fund products, such as an Islamic mutual fund, a stock-based mutual fund, and two protected funds.

She revealed that the first product, Reksa Dana Lautandhana Saham Syariah, will be launched on January 9, 2013 through the Indonesian Central Securities Depository (KSEI). This mutual fund can be purchased through bank account debit with a minimum purchase of IDR200,000.

"The Company is targeting to collect around IDR100 billion from this new product, specifically we target retail buyers around 100 people, and for high end buyers about 25 people," she said.
According to her, Lautandhana chose to launch this Islamic mutual fund in attempt to introduce Islamic-based mutual fund and to develop such industry in Indonesia.

While two protected mutual funds and one equity fund will be launched no later than the second quarter of this year.

Grace claimed that she prefers equity fund because Lautandhan considerably has an experience in managing equity-based investments. Moreover, the public interest in this investment portfolio is still big enough.

Meanwhile, the Company’s reason to launch protected mutual fund is because the Government’s decision on the implementation of tax in this mutual fund this year. According to him, the government took the policy to delay the tax implementation in order to maintain the development of the national capital market.

"One of the reasons we intend to launch a protected mutual fund is the postponement of tax application in this mutual fund product. If the tax applied by the Government then the product will not be interesting," she explained.

Kamis, 03 Januari 2013

Investor Reference 3 Jan 2013

LOTS Trading Club™ | lots.co.id
Lautandhana Securindo | YJ

Lolosnya RUU budget versi Senat di DPR AS memicu euphoria di bursa saham global. Kami pikir kini saat yang baik untuk trading sebelum kondisi kembali mencekam pada Februari nanti saat Obama memohon kepada kubu Republik untuk menaikkan debt limit dan usulan spending cut yang hanya ditunda selama 2 bulan.

Dan dengan melonjaknya index saham global rata-rata diatas 2% semalam, mungkin dapat membuat Anda 'lapar mata'. Atau bingung memilih apakah membeli saham yang belum naik (banyak) atau mengejar saham yang tengah rally. Untuk itu LTC coba mengarahkan Anda fokus pada saham yang pas dengan tema market saat ini: komoditas!

Ini bukan kali pertama LTC menyentuh komoditas, bahkan saham TINS kembali kami rekomen beli untuk ketiga kalinya karena target kedua kami di 1640 telah tembus. Maraknya pemberitaan soal bangkitnya manufaktur India dan China, serta tentu saja (mulai) naiknya impor coal oleh keduanya sangat relevan dengan tema market.

Komoditas yang masih di bottom juga menjadi pilihan yang pas saat ekonomi domestik menghadapi ancaman naiknya inflasi di 2013. PTBA, UNTR, HRUM dan SIMP kemarin breakout garis long-term downtrend yang akan memecah kebuntuan harganya selama ini.

• UNTR 20950 Buy, Target 23100, Stop Loss 20300
:::Break long-term downtrend 20400
• HRUM 6600 Buy, Target 7400, Stop Loss 6300
:::Break long-term downtrend 6350
• PTBA 16550 Buy, Target 18000, Stop Loss 16250
:::Break mid-term downtrend 16300
• SIMP 1230 Buy, Target 1290, Stop Loss 1180
:::Break long-term downtrend 1190
• TINS 1680 Buy, Target 1820, Stop Loss 1630
:::Break resist kuat 1640
• CMNP 1760 Buy, Target 1930, Stop Loss 1720
:::Ada bullish engulfing dan acuan harga placement ke MIRA di 1800
me @ LOTS Trading Club (LTC)