Improved Banking Sector
The Financial Services Authority (OJK) reported on Thursday (Sept 20) that the banking industry booked a net profit of Rp83.69 trillion in July 2018. It grew 8.36% year on year (y/y), higher than 7.95% growth in the previous month.
Corporate Actions to Watch
Feeds producer Central Proteina Prima (CPRO) will boost its sales of processed shrimp to reach 9000 tons this year valued at US$100 million. The rupiah fluctuation affects costs of import of raw materials for feeds. Higher export would offset pressures on import cost due to falling rupiah.
Walk The Talk: Coal-to-Chemical
China Coal Energy Co Ltd, one of the largest coal producers in China, produced 49.5 million tons of coal in the first eight months of 2018, down 4.1% from the corresponding period last year. The company’s coal-to-chemical business, however, pointed to 100% growth in production for polyolefins.
Oil & Gas Journal
The Budget Commission of the House Representative (DPR) and the Indonesian Government have agreed on the cost recovery set at US$10.21 billion in the State Budget (APBN) for 2019, lower than US$11.39 billion set on State Notes 2019. The decline in production cost, to less than US$5.13 billion from US$5.95 billion, is the main reason for setting lower cost recovery.
IPO to Watch: HK Metals Utama
PT HK Metals Utama, member of Hyamn Group, engaging in metal and steel manufacturing, has on Wednesday (Sep. 19) kicked of its initial public offering (IPO) for 1.46 billion shares, representing 40% of total issued and paid-up capital.
Will Wuling Make a Difference? (2)
A year ago, when Wuling started local production of its cars, we raised question about the Chinese car manufacturer’s ability to compete in the market long dominated by Japanese manufacturers. Data from Indonesian Automotive Industry Association (Gaikindo) pointed to strong first year for Wuling.
An Awful Lot to Do, but Connectivity Outlook Improved Further
We’ve seen more regional leaders joining/supporting reelection of Joko ‘Jokowi’ Widodo simply because the president is seen determined to improve the archipelago’s connectivity. Progress of the ongoing infrastructure projects gives them hopes for further modernization in their respective areas.
Corporate Actions
Property developer Lippo Karawaci (LPKR) said that its Singapore unit, OUE Limited, had sold 17.6% of first real estate investment trust (REIT) for S$202 million value (US$276.74 million). OUE Limited has signed a conditional sales and purchase agreement to take over 60% stake in Bowsprit Capital Ltd, while OUE Lippo Healthcare Ltd. (OUELH) will take over the remaining 40% stake. Bowsprit is the First REIT manager that owns 7% of the first REIT for total S$99 million.
Stocks to Watch: GIAA & Cigarette
Shares of flag carrier Garuda Indonesia (GIAA) lost 1.9% to Rp206 per share on Tuesday (Sep. 18), and falling 31.8% year to date. The stock made a good start early this year and reached its peak at Rp336 in mid of February, but since then it’s faced a bearish trend.
JORR-2 So Far…
Indonesia’s Logistic Index has improved significantly in the past few years, thanks to aggressive infrastructure development. Those living in the Greater Jakarta have high expectation of better traffic with progress of the so-called Jakarta Outer Ring Road-2 (JORR-2), even though this project might not be fully completed as scheduled by the government next year.