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Good morning,
Fasting Month
Preparation Drives Inflation In May
The headline inflation rate
inched up to 4.3% YoY in May. This was attributed mainly to rapid increases
in the price of fresh food and cost housing & utilities. For the full
year, we forecast headline inflation to pick up to 4.2% in 2017, from +3.5%
last year. This is on account of:
1. Higher energy prices as a result of a
pick-up in crude oil prices;
2. Electricity tariff hikes;
3. Modest pick-up in volatile food prices.
¨ Key
policy rate to be maintained. As inflation would likely
continue to be manageable, we expect Bank Indonesia (BI) to keep its monetary
and macro-prudential policies stable.
¨ Fresh
food price inflation was the biggest contributor to
inflation in May. This was due to fasting month preparation.
¨ Housing
& utility price inflation exerted further upward pressure in
May. This was on account of a third electricity tariff hike for prepaid
customers.
¨ A
moderation in processed food & tobacco and clothing inflation had
partly offset inflationary pressures. This was led by price decreases in some
items such as sugar, clothing, and cellular data tariff.
¨ Transport
& communication and education costs stabilised. Meanwhile,
price inflation in other major categories remained stable during the month.
¨ Core
Consumer Price Index (CPI), however, moderated to 3.2% YoY in May, from
+3.3% in the previous month, due to a stronger IDR and manageable
inflationary expectations. (Rizki Fajar)
Link
to report to be sent out later
Link
to daily report: Indonesia Morning Cuppa 050617
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Company Update:
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Indofood Sukses announced dividend payout
ratio of 50%, in line
Indofood Sukses announced to pay dividend
with payout ratio of 50% from FY16 earning. In our calculation, dividend per
share is IDR236/share and dividend yield is 2.7%. This dividend is 6% above
consensus estimates (IDR223/share). (Andrey
Wijaya)
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Media Highlights:
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Corporate
World Bank projects 5.2% growth in 2017
Bumi Serpong Damai targets IDR1.5trn land
sales this year
United Tractor shows 72% (YoY) sales growth
in 1Q17
Duta Pertiwi allocates IDR1trn for capital
expenditures
Brantas Abipraya looks to raise IDR3trn
from public offering
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Our
Recent Publication:
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Economics Update: M2, Loan Growth Continues
To Pick Up In April
Link to report: M2,
Loan Growth Continues To Pick Up In April
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Company Update: ACE Hardware - Currently
Expensive
Link to report: ACE
Hardware: Currently Expensive
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Company Update: United Tractors – Dry
Season To Boost Mining Contracting Volume
Link to report: United
Tractors : Dry Season To Boost Mining Contracting Volume
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Sector Update: Auto & Autoparts – Still
a Far Distance From Indonesia’s Industry Roadmap
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Results Review: XL Axiata – Playing
Catch-Up
Link to report: XL
Axiata : Playing Catch-Up
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Not-Rated Note: Mitra Pinasthika Mustika –
Structural Reform Is Underway
Link to report: Mitra
Pinasthika Mustika : Structural Reform Is Underway
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Company Update: Mitra Adiperkasa – Going
For Full Earnings Potential
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Company Update: Bumi Serpong Damai –
Maintains a Solid Performance
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Company Update: Bank Rakyat Indonesia –
Growing Bigger Through Micro Lending
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Company Update: Indosat – Hoping For Yield
Improvement
Link to report: Indosat – Hoping For
Yield Improvement
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Best regards,
Helmy Kristanto
Director
Head of Indonesia Research
PT. RHB Securities Indonesia
DID: (6221) 2970 7056
Fax: (6221) 2783 0777
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