It seemed that market players would focus attention on the agreement
between the government and parliament in regard to revision of APBN-P State
Budget 2013. One of the highlighted topics would be slump in Indonesia’s
economic growth from the previous 6.8% to become 6.3%. The difference of 0.5%
was rated by market players as significant figure. Compared the realization of
last year which was 6.23%, meaning the projection of 6.3% was rated as
pessimistic.
Market players compared Indonesia’s target growth of 6.3% with growth
realization of 2012 in Thailand and the Philippines which was posted at 6.5%
and 7.2% respectively; which means that Indonesia could no longer take pride of
being the best achiever because of being edged aside by the two fellow Asean
countries.
Market players had to hear bad news of trade balance which again showed
deficit excessive import of oil gas was the culprit. Only trouble was, the
decision to increase oil price by the government was never made. This made
negative market perception of Indonesia’s market even worse. This was not to
mention the impact of oil price increase which jacked up inflation in the range
of 7.5%-8.2% this year with all the implications.
Over the week the issue of economic growth would continue to overshadow
the market which restricted Rupiah movement to consolidate. Positive sentiment
would come if by next week the government finally decided to increase oil
price.
The Money Market
During transaction on Wednesday [5/6] or one day before national holiday
last Thursday, Rupiah value against USD at the interbank spot market
strengthened at Rp9, 790 per USD; previously Rupiah was opened at Rp9, 800 per
USD with strongest level Rp9, 790 and weakest level 9,805, finally Rupiah was
closed to settle at Rp9, 970 per USD.
Rupiah position inched up, driven by minimum sentiment. Market players
were also still waiting for data of Non Farm Payrolls and ADB Employment Data.
Investors who were waiting for employment data, ISM non-manufacturing data
report etc. made USD quite stable and needed no extra momentum. Such had the
positive impact on Rupiah to give it extra energy to inch up.
In addition to that there were no sentiments from the domestic side to
influence Rupiah movement. Government’s indecision about increasing oil price
brought negative sentiment on Rupiah. Rupiah only inched up after the Central
Bank made intervention on Rupiah. Demand for USD increased by end of last
month. Although the Central Bank constantly safeguarded Rupiah, Government’s
indecision brought negative impact on Rupiah.
Acts of profit taking at the stock market by foreign investors
contributed to mounting pressures on Rupiah. It was known that investors made
net sell of Rp616.05 billion.
During transaction last weekend [7/6] Rupiah value against USD had the
potential to weaken although in reality Rupiah turned out to strengthen to the
position of Rp9, 780 per USD compared to the position during closing session on
Wednesday [5/6] at Rp9, 785 per USD. Apparently by week end trade volume tend
to thin out, which forced Rupiah to consolidate,
Rupiah would also be influenced by external data like Non Farm Payrolls.
US economic data tend to be satisfactory, hence giving positive sentiment to
USD which could hamper Rupiah value. In response to it BI would make
intervention to keep Rupiah from sinking to deeply. All in all Rupiah was
predicted would be in the range of Rp9, 775 – Rp9, 850 per USD.
Many analysts predicted that external sentiment would constantly
overshadow Rupiah movement. Sentiment from the Fed who made their buying of
obligations sooner, and Indonesia booking bigger deficit, brought negative
sentiment on Rupiah. So projection of Rupiah value this week would be in the
range of Rp9, 775 – Rp9, 850 per USD was quite reasonable.
One thing noteworthy was when the Directorate General of Debt
Management, Ministry of Finance [DJPU] stipulated 20 financial institutions as
candidate seller of retail [ORI] at the Premier Market of budget year 2013. The
committee for ORI agency service of the Premier Market budget year 2013 DJPU of
the Ministry of Finance mentioned that 20 candidate agents of ORI consisted of
17 banks and 3 security companies.
The 17 banks were Citibank NA, Bank ANZ Indonesia, Bank Bukopin, Bank
Central Asia, CMB Niaga, Bank Danamon Indonesia, Bank International Indonesia,
Bank Mandiri, Bank Negara Indonesia, OCBC, Bank Panin, Bank Pembangunan Daerah
Jawa Barat & Banten. Also Bank Permata, Bank Rakyat Indonesia, UOB
Indonesia, Standard Chartered Bank and the Hong Kong and Standard Banking
Corporation.
Meanwhile three security companies were Danareksa Sekuritas, Trimegah
Securities and Mandiri Sekuritas. The decision was effective as per date of
stipulation [May 31, 2013] until the end of rejection period, i.e. 5 working
days after stipulation.
The prediction that Rupiah would be under pressure was also made when
there was good news from the Central Board of Statistics [BPS] which posted
deflation of 0.03% which was the first deflation for the first time in the past
10 years. The deflation figure in May was thanks to the Government’s role in
overcoming increased food price, which accounted for high inflation at early
year.
Some commodities having downturn in May 2013 were among others red
onions, garlic’s, rawit chili, red chili and gold & jewelry. The general
inflation components contributed 0, 03% followed by restless price 1.1% while
general inflation contributed 0, 83 inflation of 0. 06% and price regulated was
0, 96%. Meanwhile based on expenditure group, food contributed deflation of 0,
83% followed by garment’s category where deflation was posted at 1. 22%.
The categories of ready food, beverages and tobacco contributed 0. 35%
to inflation, followed by housing, water, electricity, gas and fuel which were
having inflation of 0. 75%. Furthermore the health category also contributed 0.
23% to inflation; education, and sport 0. 06% and transportation, communication
and finance had deflation of 0. 03%. Hence inflation rate of calendar year
January-May 2013 reached 2.3% and annual inflation [ y o y ] 5.4%.
Supposedly combined two good news: ORI sales plan and May deflation
contributed to Rupiah strengthening, but it did not happen due to the sizable negative
sentiment and negative perception of foreign investors. Moreover at about the
same time BPS also released negative news about Indonesia’s trade balance which
posted deficit of USD 1.62 billion – as Indonesia’s import outsized export.
Indonesia’s total export in April 2013 was 14.7 billion USD. Meanwhile
the total export was USD 16.31 billion – so in April deficit was posted at USD
1.2 billion. Trade balance for the period of January to April 2013 still posted
deficit of USD 1.85 billion. Export was posted at USD 60.11 billion and import
was posted at USD 61.96 billion. The cause do deficit in Trade Balance was oil
gas import which never went down.
The capital market
Just like Rupiah’s unimpressive projection, index oh IHSG was predicted
to weaken by end of session last Friday [7.6%]. IHSG would be at the level of
support and resistance at 4,950 – 5,000, being overshadowed by continued act of
selling by foreign investors and negative sentiment from trade deficit which
reached high record for the period of April last.
Evidently, IHSG sank by 16 points and must submerge from the
psychological level of 5,000. During pre-opening session, IHSG weakened by
16.898 points [0, 34%] to the level of 4,984.323 whist index of LQ45 dropped by
4.260 points [0.51%] to the level of 826.832.
Furthermore, starting session last weekend, [7/6] IHSG was opened to
lessen by 27.521 points [0.55%] to the level of 4,973.700. Index of LQ 45 was
axed by [0.78%] to the level of 824,642. Acts of selling were focused on
premium shares which already rose notably high. There was only one industrial
sector at the stock market hall which still strengthened. Broadly speaking IHSG
was still affected by negative sentiment from the Asian stock market although
the Wall Street stock market ended positively after fluctuating toward
announcement of the latest US employment data.
Regional stock markets moved the mixed way where some shares managed to
strengthen, some of them trapped in the red zone. Index of composite Shanghai
rose by 4.65 points [0.21%] to the level of 2,246.76. Index of Hang Seng
strengthened by 90.45 points [0.41%] to the level of 21,747.98. Index of Nikkei
was reduced by 122.51 points [0.95%] to the level of 12, 781, 51. Index of
straits times fell by 8, 63 points [0.27%] to the level of 3, 184.88.
Meanwhile IHSG which weakened last Wednesday [5/6] was driven by
external negative sentiment. Statement of the economists that the Fed would
probably slowdown stimulus now underway would not be until September amidst
economic recovery. The estimates was in tandem with bettered some of US
economic data including unemployment data.
In addition to that, Asian regional stock market also weakened following
the downfall of Nikkei index in response to the speech of Primer Minister
Shinzo Abe in relation to Japan’s economic strategy. Acts of buying was also
triggered by Dow Jones stock market which weakened and negative sentiment from
market players’ fear of the Fed’s stimulus.
At the Asian stock market there was declining stock transaction last
Friday [7/6] as shares in Japan soared up in three years and market players
were waiting for the US employment data. Index of Topic Japan weakened by 1.6%.
Index of MSCI Asia Pacific was volatile, inching up to 0.1% to the level of 131,
44 at 10.22 Tokyo time. Index of Nikkei Japan weakened by 1.4% to the level of
12,724.83.
Previously index of shares had sumped by 9% from the highest level on
May 20th. This index of benchmark share weakened amidst speculations
that America’s economy was improving which forced the Fed to review their
stimulus policy. On the other hand, Japan’s Prime Minister failed to impress
investors about development strategy in his speech last weekend. PM Abe’s
development strategy had been anticipated which eliminated the chance of
buying. Japan’s stock market was corrected to a point where some might buy some
share.
Other stock markets on the downturn were among others Australia stock
market weakening by 0.5%, New Zealand inching down by 0.1% index of Kospi South
Korea weakened by 0.6%. Meanwhile Index of Hong Kong Hang Seng weakened by 0.6%
during initial session. Index of Shanghai inched up by 0.2%. Some shares
weakened, like Newcrest Mining Ltd weakened by 3% while share of Tokyo Electric
Power Co increased by 5.1%.
Back to the local security exchange [BEI] IHSG was projected to weaken
in the range of 4,940 – 5,020 although inflation was haunting shares of
consumer goods, this sector was predicted to move positively through Semester
Two 2013. Some factors jacked up the consumer goods sector:
Firstly, the emerging middle class in Indonesia which had come to 100
million people.
Secondly, increased people’s purchasing power due to increase of the
nation’s per capita income.
Thirdly, the population of Indonesia which continued to increase.
However, this sector had to face future challenges like increased price
of subsidized oil, inflation, increased electricity tariff [TDL] and workers’
wages; moreover with the mounting threat of competitors’ product were
increasing in number.
PT Semen Baturaja Tbk had great opportunity to make positive
performance; this was proven by various domestic infra structure projects
underway, which created a high demand for cement industry. The cement industry
in Indonesia would be highly prospective which support of infra structure
building being spurred on by the government; not to mention the energized
property industry in Indonesia being enhanced by the government. Furthermore
there was the dynamic property industry in Indonesia and the zealous project
developments run by developers.
The investment factor in Indonesia in various industry sectors also
triggered development of factories, office buildings, housing, roads etc. so
Indonesia economy would still grow, being supported by increased domestic
consumption.
To review performance of PT Semen Baturaja over 2008-2012, there was
average sales of 8% while net profit was posted at 22% which indicated that
there had been positive company’s growth year after year. Furthermore Semen
Baturaja commanded over 48% of market share In South Sumatra and 28% market
share in Lampung which could serve as asset for future growth.
PT Semen Baturaja would run IPO in this year 2003. IPO of BUMN was being
awaited for by players of the capital market. Moreover in 2012 there was not
single BUMN who run IPO. Predictably IPO of PT Semen Baturaja would get
positive response from investors. Performance of infra-structure builder
companies was recently high. Semen Baturaja which was a producer of cement
would be advantaged by the condition.
The fund obtained from IPO would be used for building a cement factory
in Sumatra. This was necessary to increase production capacity this year at
1.85 million tons. This emitent candidate offered IPO price around Rp500 –
Rp685 per share. Pricing was based on Price Earning Ratio 2013: 13.5 times this
year; whist next year would be 13 times and 11.4 times in 2015 next. The
company would release 23.76% share to the public numbering 2, 33 billion
shares.
Not less important was PT Cipaganti Citra Graha Tbk who would offer
shares amounting to 2 billion shares at nominal value of Rp100 or equal to
placed capital and fully paid to the public. The shared being offered consisted
of 1.75 billion shares and shares of PT cipaganti Global Corporindo 250 million
shares. In this IPO the company was also doing employee stock allocation [ESA]
numbering 40 million shares.
The IPO based shares would be used for investment like expansion of
vehicles armada and other supporting factors constituting around 93.21% while
around 6.79% would be used for company’s working capital. The company had
appointed PT Mandiri Sekuritas and PT Kim Eng Securities as Guarantor of
Emission.
The company booked comprehensive profit to be attributed to owner of
main entity to rise to Rp76.29 billion in 2012 of the same period the previous
year at Rp42.74 billion. Company’s business income rose to Rp639 billion in
2012 against the same period the previous year at Rp529.43 billion. Total
company’s liability was Rp872.88 in 2012 of the same period the previous year
Rp888, 95 billion. Company’s asset rose to Rp1.38 trillion in 2012 of the same
period of last year Rp1.15 trillion.
Initial offering of shares in June 5-18 2013, the effective date being
June 27, 2013, General Public Offering on July 1-3 2013, allocation and
distribution of shares on July 8, 2013, and booking of BEI shares on July 9,
2013. (SS)
Business News - June 12,2013
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