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Good morning,
Bank
Central Asia – Maintain Its Conservativeness
Yesterday BCA (BBCA IJ, Neutral, TP:
IDR17,200) held its FY16 result. Using yesterday’s closing price, BCA trades
at 2017F P/BV multiple of 2.9x (-0.3SD of its historical mean). Our
GGM-derived TP implies 3.2x P/BV multiple for 2017F.
Key highlights:
FY16 performance:
 Net
interest income represents 103.8%/102.8% of our/consensus forecast.Reported
net interest margin (NIM) expanded to 6.8% due to lower blended CoF at 2%
(FY15: 2.4%).Lower
cost to income ratio (CIR) at 43.5% from 45.4% due to cost efficiency
initiatives, i.e. limited branch expansion and invest more into mobile and
internet banking features.Gross
non-performing loans (NPL) ratio of 1.3% (end-2015: 0.7%) coming from
Trikomsel’s loan as well as other sectors that mostly the derivatives of
commodities sector (mining contractor and logistics).Higher
credit cost at 113bps (FY15: 85bps) to provide ample buffer for its higher
gross NPL ratio.Net
profit of IDR20.6trn accounted for 100.9%/103.3% of our/consensus forecast.
4Q16 performance:
Net
interest income up by 2.1% QoQ supported by 7.7% QoQ loan growth.6.9%
reported NIM, slightly higher compared to previous quarter, due to a higher
asset yield of at 10.6%(3Q16: 9.2%).Higher
credit cost at 142bps with a slight improvement in gross NPL ratio (Sep-16:
1.5%) as BCA’s management increase its loan loss coverage (LLC) ratio to
231.3% (Sep-16: 201%).
What we miss:
Lower
than expected loan growth of 7.7% in FY16 as we expect higher figure of 13%
in our model.
What to expect:
Asset
quality would improve in our view as loan growth and GDP growth would start
to pick up. Expect loan growth would be inline with industry’s figure of 10%,
lower than our current forecast of 14%. Asset
yield would continue to fall due to a higher mortgage contribution into its
loan portfolio. For this segment, BCA currently offer promotional rate of 6%
pa fixed 2 years and cap at 6.88% pa the next 3 years. We expect lower asset
yield at 7.6% in FY17 (FY16: 7.9%).BCA’s
management did not provide clear guidance on loan growth as well as gross NPl
ratio target for this year. NIM
would decline to 6.4% in FY17 (FY16: 6.8%) in our forecast mostly coming from
a compression asset yields projection. So our model suggest more upside risks
on the NIMs side that may come from lower blended CoF if BCA continue to push
its CASA deposits.Funding
should remain manageable aside because CASA deposits would continue to be the
main contributors on its both customer deposits and funding mixture.We
maintain our NEUTRAL call on Bank BCA with a GGM-derived target priced of
IDR17,200. (Eka Savitri)
Link
to daily report: Indonesia Morning Cuppa 140317
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Media
Highlights:
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Corporates
Semen Indonesia
gained market shares
Semen Indonesia
reported higher 2M17’s sales to 4,038k tonnes (+1.8% YoY), partly driven by
lower 2M17 domestic ASP of IDR759,000/tonne (-9.8% YoY). Notably, in the same
period, national cement sales declined by 1.1% YoY. In our calculation, Semen
Indonesia’s market shares increased to 41.6% in 2M17 (versus 40.4% in 2M16).
On area basis, higher sales volume was driven by Semen Indonesia plants
located in Tuban, East Java. We maintain Neutral with DCF-based TP of
IDR9,800 (4% upside), implies FY17F P/E of 12x. (Andrey Wijaya)
Wika Beton announces
dividends
ISSP to issue
USD250mn global bond
Adhi Karya eyes
IDR3trn from property projects
Chandra Asri booked
USD300.1m in FY16’s net profit
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Our
Recent Publication:
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Sector Update: Coal Mining – Noises Create
Opportunity To Accumulate
Link to report: Noises Create Opportunity To Accumulate
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Sector Update: Plantation – Gradual
Recovery In Output Expected From 2Q17
Link to report: Gradual Recovery In Output Expected From 2Q17
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Sector Update: Consumer – Although Softer,
Spending Is Likely To Improve
Link to report: Although
Softer, Spending Is Likely to Improve
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Sector Update: Retail – Rainy Month, Dry
Sales
Link to report: Rainy
Month, Dry Sales
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Sector Update: Plantation – Varied Price
Views From POC 2017
Link to report: Plantation:
Varied Price Views From POC 2017
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Results Review: Adaro Energy – Cash Rich
Link to report: Adaro Energy : Cash Rich
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Company Update: Telekomunikasi Indonesia –
A Clear Winner
Link to report: Telekomunikasi Indonesia : A Clear Winner
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IndonesiaStrategy: Needs Accelerant
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Initiating Coverage: Harum Energy – Higher
Production To Boost Earnings
Link to report: Harum
Energy : Higher Production To Boost Earnings
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Results Review: Japfa Comfeed – Weaker
Growth Outlook
Link to report: Japfa
Comfeed Indonesia : Weaker Growth Outlook
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Best regards,
Helmy Kristanto
Director
Head of Indonesia Research
PT. RHB Securities
Indonesia
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