MERDEKA COPPER GOLD (ID), a company active in the Gold Mining industry, has received a double requalification by the independent financial analyst theScreener. Its fundamental valuation is now 3 out of 4 stars while its market behaviour can be considered as defensive. theScreener believes that the gain of a star(s) and an improvement in the market risk perception allows upgrading the general evaluation to Slightly Positive. As of the analysis date March 4, 2022, the closing price was IDR 4,240.0...
After the strong performance ytd, technology stocks declined over the past month. We think there could be a switch to laggards. Recovery names such as JSMR could outperform while retailers and F&B businesses such as MAPI could see a large swing in profit recovery. Purchasing power could also recover, benefitting UNVR. Nontechnology LQ45 index is now trading at the largest discount over the past 10 years vs the JCI. Our picks: JSMR, MAPI, UNVR, MYOR, BMRI and TLKM. Top sell: MDKA.
Full Article at IIR has reaffirmed its Recommended rating for PIA after undertaking a review post the appointment of a new Portfolio Manager, Harding Loevner. The full report can be found on the IIR website. On 26 July 2021, Pengana International Equities Limited (PIA) announced a fully franked dividend of 1.35 cents per share for the June quarter. This represents an 8% increase on the March quarter dividend and takes the total dividends declared for FY21 of 5.1 cents per share, fully franked....
2020 net income plunged by almost 50% yoy to US$36m due to a 20% yoy drop in revenue and a cost of US$12m for reinstating heap leaching. Gold sales volume fell 30% in 2020 and is likely to drop another 24% in 2021. Despite gold price stagnancy, share price rose 9% in the last week, fuelled by a Rp539b share buyback plan and 6% wow rise in copper prices. Maintain SELL with target price of Rp1,900 as MDKA is trading at 20.7x 2021F EV/EBITDA, way above peers’ 2021F EV/EBITDA mean of 9.2x.
GREATER CHINA Sector Biotech: A fruitful year with accelerated expansion. INDONESIA Results Merdeka Copper Gold (MDKA IJ/SELL/Rp2,380/Target: Rp1,900): 2020: Net income plunged almost 50% yoy due to the cost of reinstating heap leaching. Maintain SELL. MALAYSIA Malaysia Corporate Day E-Conference Takeaways Axiata (AXIATA MK/BUY/RM3.79/Target: RM4.70): Equal-footing merger of Digi and Celcom could be value-accretive at Axiata level. SINGAPORE Sector Banking: 1Q21 results preview: Firing on man...
ASEAN Sector Banks: ASEAN Banks: Monthly update. GREATER CHINA Sector Automobile: Weekly: PV sales grew 7% yoy in February, in line with estimates. Maintain MARKET WEIGHT. Top picks: Weichai Power, Brilliance and Yongda. Results Powerlong Real Estate Holdings (1238 HK/BUY/HK$6.35/Target: HK$8.10): 2020: Above expectations; targeting Rmb105b contracted sales In 2021. INDONESIA Update Merdeka Copper Gold (MDKA IJ/SELL/Rp2,750/Target: Rp1,900): 2021 EBITDA could grow 12% yoy, but valuation is exp...
For 2021, management targets to lower gold production by 24% yoy to 100k-120k toz due to a remediation plan after a heap leach pad incident in 2020. However, the combination of 3x yoy copper production growth to 17,000mt Cu and a 45% yoy higher copper price estimate could offset the gold business’ lower contribution and drive 2021 EBITDA to grow 12% yoy. On the flip side, as MDKA is currently trading more than +2SD of its 3-year EV/EBITDA 2021. We maintain SELL with a target price of Rp1,900.
Banks - Regional: ASEAN Banks: Monthly update. Merdeka Copper Gold (MDKA IJ/SELL/Rp2,750/Target: Rp1,900): 2021 EBITDA could grow 12% yoy, but valuation is expensive. TRADERS’ CORNER Charoen Pokphand Indonesia (CPIN IJ): Technical BUY Indofood CBP Sukses Makmur (ICBP IJ): Technical BUY
The corporate tax cut policy and US$47b stimulus could increase investment and boost GDP growth. Mass global vaccinations could be catalysts for the market. The JCI and its earnings are likely to structurally recover. We expect the JCI’s earnings to have dropped by 39% in 2020, followed by a 65%/12.5% recovery in 2021F/22F respectively; we assign an EOY Dec 21 6,700 JCI target. Our 15 picks: BBNI, BMRI, MAPI, KLBF, WIKA, WSKT, CTRA, BSDE, SMRA, INTP, PGAS, TBLA and UNTR. SELLs: MDKA and ACES.
The corporate tax cut policy and US$47b stimulus could increase investment and boost GDP growth. Mass global vaccinations could be catalysts for the market. The JCI and its earnings are likely to structurally recover. We expect the JCI’s earnings to have dropped by 39% in 2020, followed by a 65%/12.5% recovery in 2021F/22F; we assign an EOY Dec 21 6,700 JCI target. Our 15 picks: BBNI, BMRI, MAPI, KLBF, WIKA, WSKT, CTRA, BSDE, SMRA, INTP, PGAS, TBLA and UNTR. SELLs: MDKA and ACES. • Corporate tax...
Indonesia’s MOF has highlighted that the country’s spending ability is now stronger relative to its ability in 2008-09. The MOF has allocated a cumulative Rp1,067.5t (6.65% of 2019 GDP or about US$75b) budget for 2020-21. This stimulus is 14.6x larger than the GFC stimulus. Absorption rate for 2020’s stimulus is at 55.1% as of 9 November. The much larger stimulus and structural reform should drive GDP growth. Our picks: BMRI, BBNI, ICBP, MAPI, KLBF, PTPP, BSDE (BUYs) and MDKA (SELL).
GREATER CHINA Sector Aviation: Airlines and logistics firms among key beneficiaries of COVID-19 vaccine distribution. Results JD.com (JD US/BUY/US$92.08/Target: US$105.00): 3Q20: Solid earnings beat; committed to investing in logistics for grocery categories. Update Baosteel (600019 CH/BUY/Rmb6.54/Target: Rmb8.62): Demand supports earnings recovery; upgrade to BUY. INDONESIA Update Merdeka Copper Gold (MDKA IJ/SELL/Rp1,860/Target: Rp1,400): Bloomberg consensus cut 2021 gold price forecast by 10...
3Q20 gold production declined 21% qoq and 33% yoy due to the heap leach pad incident. In 9M20, gold production declined 13% yoy. Production integration at the Wetar mine site and the AIM project have reduced copper production by 68% yoy. Bloomberg consensus has cut 2021F gold price by 10% to US$1,906/toz, confirming our view that there is downside risk to gold prices. MDKA is overpriced at 8.9x 2021F EV/EBITDA (above +2SD to its 2021F EV/EBITDA of 8.5x), which is 33% above peers’ average. Mainta...
The outcome of the US presidential election could translate into a risk-on strategy from investors. This could lead to funds flowing into emerging markets such as Indonesia, leading to a rupiah appreciation and a higher JCI. We expect the JCI to rally from Dec 20 to Apr 21. Our targets for the JCI are 5,500 and 6,200 as at end-20 and end-21 respectively. Beneficiaries of fund inflow will be BMRI and BBNI while the beneficiaries of a stronger rupiah will be ICBP, UNVR, MAPI, KLBF and ASII. Sell M...
Strategy: Impact Of US Presidential Election On Indonesia: The outcome of the US presidential election may translate into higher foreign funds flow and GDP recovery. Our picks: BBNI, BMRI, ASII, KLBF, ICBP and MAPI. Top SELL: MDKA. TRADERS’ CORNER HM Sampoerna (HMSP IJ): Technical BUY Bank Danamon (BDMN IJ): Technical BUY
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