FROM EQUITY RESEARCH DESK

IDEA OF THE DAY

Metal Mining: 4Q24 preview: A Softer Quarter on Easing Commodity Prices (NEUTRAL)

• We estimate a slightly weaker 4Q24 earnings trend from declining ASPs, though some companies excel through soaring sales volume.
• We expect ANTM and NCKL to beat consensus’ FY24 estimate at 132%/ 111% from increased sales volume.
• We maintain our Neutral rating with a revised pecking order of ANTM> NCKL> INCO> TINS> MBMA> MDKA

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RESEARCH COMMENTARY

SIDO (Buy, TP: Rp640) - FY24 results: In Line with Consensus Estimates

FY24 results:

• FY24 revenue grew 10% yoy, supported by F&B (+18% yoy) and Herbal (+6% yoy).
• FY24 gross margin improved 210bps to 58.7%, supported by ASP adjustment and higher sales volume.
• With manageable opex, FY24 net profit increased +23% yoy to Rp1.7tr.
• The FY24 net profit accounted for 103.4% of consensus estimates (inline) and 113% of our FY24F (above).

 

4Q24 results:

• Revenue surged 77% qoq, driven by strong Herbal segment growth (+118% qoq) and F&B (+18% qoq).
• Robust Herbal revenue led to strong 4Q24 gross margin of 63%.
• Despite higher opex, 4Q24 Net profit rose 7.9% yoy to Rp393bn. (Natalia Sutanto & Sabela Amalina – BRIDS)

MARKET NEWS

MACROECONOMY

ECB Lowered the Interest Rates by 25 bps

The ECB lowered the three key interest rates by 25 basis points, as expected, reducing the deposit facility rate to 2.50%, the main refinancing rate to 2.65%, and the marginal lending rate to 2.90%. This decision reflects an updated assessment of the inflation outlook and monetary policy transmission. (Trading Economics)

 

Trump Delays USMCA Tariffs on Mexico and Canada Until April 2, 2025

President Donald Trump on Thursday signed executive actions that delay until April 2, tariffs on all products from Mexico and Canada that are covered by the USMCA free trade treaty. (CNN)

 

SECTOR

Commodity Price Daily Update Mar 6, 2025

Telco: Indonesia Loses Out on Data Center Investments as Foreign Firms Favor Malaysia and Thailand
Despite having the highest number of TikTok users globally, Indonesia is being bypassed for major data center investments, with ByteDance opting to spend US$8.8bn in Thailand and US$2.13 bn in Malaysia’s Johor region. While Indonesia has a mature data center market, it lags behind regional hubs like Malaysia, where Johor alone accounts for 774 MW of capacity—19% more than Indonesia’s total. One of the key deterrents is the country’s monopolistic internet service industry, dominated by Telkom Indonesia, Indosat Ooredoo Hutchison, and XL Axiata, which control 80% of the market. Telkom Indonesia alone generates around 60% of industry revenue, with firms like Cloudflare openly criticizing unfair practices that hinder foreign operators.

Indonesia’s efforts to attract investment, including the Danantara Sovereign Wealth Fund’s push for AI-focused data centers, are undermined by restrictive policies that prioritize national interests over market liberalization. This creates an investment climate that is less attractive than even Vietnam, despite Indonesia’s strong digital economy potential. As a result, global tech firms are turning to neighboring countries with more favorable regulatory environments and infrastructure, solidifying Malaysia and Thailand as the preferred data center hubs in the region. (SosMed)

 

CORPORATE

EXCL-FREN: Komdigi Approves the Merger; Issues Principle Permit

Komdigi has approved the merger of XL Axiata, Smartfren, and Smart Telecom, issuing a principal permit. The final Ministerial Decree will only be issued once XLSmart fulfills certain requirements. Each company will hold RUPSLB on March 25, 2025. Smartfren’s PresDir Merza Fachys, expects XLSmart to be officially launched after Eid. (Detik)

 

Comment:

This is a breakthrough decision for the merger to proceed. Komdigi's approval is principle-based and subject to specific requirements, likely related to spectrum holdings optimization. The next key milestone is the OJK approval. If OJK approves the merger, it will be followed by the RUPSLB of the companies. We estimate XLSmart will be launched after the dividend payment around April 24, 2025, aligning with EXCL's dividend distribution. This timeline is also in line with Smartfren’s President Director's expectation for a post-Eid launch. (Niko Margaronis & Kafi Ananta – BRIDS)

 

EMTK Acquires 74.2mn SCMA Shares

EMTK has increased its stake in SCMA by acquiring 74,263,900 shares, equivalent to 0.10% of SCMA’s total outstanding shares. The shares were purchased at an average price of IDR 202 per share. Following this acquisition, EMTK's ownership in SCMA has risen to 62.82%. (Emitennews)

 

FIF Recorded Profit of Rp4.4tr in 2024

PT Federal International Finance (FIF) posted a net profit of Rp4.4tr in 2024, up 7.5% from the previous year. Financing disbursement grew by 8.5% to Rp45.9tr with 3.2mn units financed. FIF also recorded a Net-Service Asset of Rp46.7tr (+16.1%) and maintained a NPF rate of 1.18%, reflecting strong performance and its commitment to being a reliable financial solution for Indonesians. (Kontan)

 

Freeport Officially Granted Export Concentrate Extension Until Jun25

The Ministry of Energy and Mineral Resources (MEMR) has officially issued a Ministerial Regulation granting an extension of the copper concentrate export license to PT Freeport Indonesia (PTFI) until Jun25. According to the MEMR, this policy is not a form of export relaxation, but rather a measure to address the force majeure conditions faced by Freeport. (Kontan)

 

ISAT Expands 5G Network to Eastern Indonesia

IOH is set to expand its 5G network in Eastern Indonesia, covering Kalimantan, Sulawesi, Maluku, and Papua (Kalisumapa) starting in 2025. The first three cities targeted for 5G deployment are Makassar, Balikpapan, and Pontianak, identified as having high potential for 5G ecosystem development due to strong user growth in the region. IOH is mapping out demand and assessing ecosystem readiness before proceeding with a broader rollout. (Bisnis)

 

Maxim Unable to Provide THR to Ride-Hailing Drivers Due to Financial Constraints

Maxim refuses to provide THR to drivers, citing that their relationship with drivers is a partnership and not an employer-employee relationship. Maxim emphasized that THR does not align with existing labor and transportation regulations, including the Minister of Manpower Regulation (2021) and Minister of Transportation Regulations (2019 & 2018). Maxim says is financially constrained and that it has insufficient time for proper formulation for THR. (CNBC)