Improved Indicators?

Indonesian Automotive Industry Association (Gaikindo) was upbeat with sales of cars in the first two months of 2017, which grew 5.8% from the corresponding period of 2016. Time will tell as to whether this year’s sales would beat the association’s growth projection of 3-4%. Sales of heavy equipment/construction machinery also jumped significantly in the first two months of 2017, lifted by demand from mining sector.

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Jakarta Election Runoff: Ahok-Djarot’s Movements

The Jakarta Governor Basuki “Ahok” Tjahaja Purnama, his running mate Vice Governor Djarot Saiful Hidayat (Ahok-Djarot), and the Jakarta provincial administration in the last few days have been making interesting moves. It appears that the incumbent is trying to show that they are decisive and better, particularly in terms of executing programs/policies, than their contender Anies Baswedan-Sandiaga Uno (Anies-Sandi).

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The E-KTP Graft Case: Dynamics in Golkar & Novanto’s Future (3)

The Chairman of Golkar Party Setya Novanto has been under scrutiny with his name being mentioned multiple times in the indictment of the E-KTP graft case suspects. Novanto’s position in the Golkar Party may be under threat. We have seen movements in the Party in recent days indicating intensifying political dynamics. There are voices inside Golkar calling for an extraordinary congress (Munaslub) to be held, which may indicate a push towards a leadership change. Novanto himself seems to be preparing for such a scenario. He reached out to all of the chairmen of Golkar’s provincial chapters (DPD I) in a bid to affirm continued support in his leadership of the Party.

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The E-KTP Graft Case: Plot Twist

On March 23, 2017, the Corruption Court of the Central Jakarta District Court resumed the trial of the two defendants in the electronic identity card (E-KTP) graft case. The trial session took a surprise turn when one of the witnesses summoned by the prosecutors asked the Panel of Judges to withdraw her Investigation Report (BAP). The witness claimed that she was forced to admit her involvement and that the investigation was conducted under threat.

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FY16 Results: Fast Food Indonesia

PT Fast Food Indonesia (FAST) Tbk, operator of Kentucky Fried Chicken outlets, booked net profit of Rp173 billion last year, jumped 64% from 2015. The Company was more aggressive last year with 32% increase in acquisition of fixed assets to grow its outlets.

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The E-KTP Graft Case: New Suspect

The Corruption Eradication Commission (KPK) finally named Andi Agustinus a.k.a Andi Narogong a new suspect in the electronic identity cards (E-KTP) procurement graft case. Andi, whose name dominates the indictment prepared for the first two suspects, was detained yesterday afternoon. The KPK has 24 hours to keep Andi in detention before they have to decide to release him or to keep him in custody. The interesting thing is that, despite the massive role he supposedly play in the scheme, nobody seems to really know who Andi Narogong is.

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Market & Corporate Actions

Foreign investors continued buying local stocks on Thursday (Mar 23) as they booked a net buy of Rp429.1 billion, bringing year-to-date net buy to Rp6.08 trillion. The composite index of the Indonesia Stock Exchange (IDX) gained 0.54% to close at 5,563 yesterday.

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FY16 Results: Indofood Group & Ultrajaya

Indofood Sukses Makmur (INDF), the largest food company in Indonesia, booked net profit of Rp4.14 trillion last year, jumped by almost 40% from 2015, but mostly due to substantial decline in finance costs. The group’s sales revenues grew only 4.2% last year with even weaker growth of 2.2% in the last quarter of 2016.

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Banking Updates

Some of the banks that suffered losses last year have reported positive earnings in January this year. The Central Bank (Bank Indonesia/BI) reported that national commercial banks booked a net profit of Rp10.54 trillion in January 2017, it grew by 8.3% from Rp9.73 trillion in the same month of 2016. This is a positive trend, compared to 4.9% profit decline in profit growth in January 2016.

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Barito Pacific & Star Energy Acquisition

After years of speculation, Barito Pacific (BRPT) has on March 21, 2017 signed a suplemental memorandum of understanding with Star Energy Investment Ltd (SEIL) and SE Holdings Limited for the acquisition of Star Energy Group Holdings Pte Ltd. This is a related party transaction because both BRPT and Star Energy are controlled by the family of Prajogo Pangestu.

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March 2017
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