Indonesia

• Amman Mineral Internasional (1416286D IJ), an Indonesian copper-gold producer, has launched an IDX IPO to raise US$870 million. Bookbuilding runs from 31 May to 16 June.
• We previously discussed the IPO in Amman Mineral Internasional IPO: The Investment Case. 
• In this note, we discuss valuation. Our analysis suggests that the IPO price range of IDR1,650-1,775 per share is attractive. We would participate in the IPO.

• ASSA continues to demonstrate the ability to adapt to the changing environment in 1Q2023 with growth in its car fleet and improving profitability for logistics and the last mile. 
• Anteraja has seen a slowdown in e-commerce revenues but is focusing more on building offline customers, whilst ASSA logistics is increasingly focused on mid-mile and cold-chain logistics. 
• JBA Auction is seeing a strong recovery to pre-pandemic levels and maintains 40% market share, whilst Caroline is targeting 3,000-4,000 used car sales in 2023, whilst expanding its offline network.

• BFI Finance Indonesia management recently confirmed its expectations for receivables growth of +20% YoY this year, which looks conservative after a strong start to the year, with +53.9% new-financing growth. 
• The company booked a strong set of 1Q2023 numbers with strong new bookings growth,  improving net interest spreads, low NPLs, and an ROE of over 22%
• BFI Finance Indonesia has the lowest cost of funds of the multi-finance companies in Indonesia, with a long track record of strong risk management, and remains a top pick.

• GoTo (GOTO IJ) is seeking shareholder approval to raise new capital through a private placement of shares (118.4bn A shares). Shareholder meeting will be held on 30th June.
• The company’s strategy to prioritise profits have put pressure on growth rates and it seems that the company is in need of more funds to refuel its decelerating growth rates.
• Though profit matrices have improved, some important growth matrices such as GTV have shown a downward trend and the company is still burning cash.

• Amman Mineral Internasional (1416286D IJ) is looking to raise around US$880m in its Indonesian IPO. 
• Amman Mineral International (AMI) carries out exploration, development, mining, processing. The company operates an open pit copper and gold mine known as the Batu Hijau mine in Indonesia.
• AMI’s profitability grew dramatically over the track record period. However, copper prices might possibly be on a downtrend in the near term.

Lucror Analytics Weekly Wraps provide an overview of all Morning Views comments and reports published by our analyst team in the past week, and also showcase a list of the most-read reports.

In this Insight:

1. Vedanta Resources
2. China Jinmao Holdings
3. Lifestyle International Holdings
4. Geely Auto
5. First Pacific Co

and more…

The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks. The Asia Monthly is intended to broaden investors’ understanding of the Asian USD high-yield market.

• Amman Mineral Internasional (1416286D IJ), an Indonesian copper-gold producer, has launched an IDX IPO to raise US$860 million. Bookbuilding runs from 31 May to 16 June.
• Amman’s Batu Hijau mine when combined with the Elang project has the fifth largest copper equivalent reserves in the world, according to Wood Mackenzie.
• The key elements of the investment case rest on world-class reserves, credible development plans, solid top-line growth, high profitability, leading cost competitiveness and cash generation.

• Indonesia-based social commerce platform Evermos today announced that it had raised US$39 million in its Series C funding round.
• It was led by the International Finance Corporation (IFC) — a member of the World Bank group — and IFC Emerging Asia Fund, LP, managed by IFC Asset Management Company, with the participation of returning partners such as Jungle Ventures, Shunwei Capital, UOB Venture Management, and Telkomsel Mitra Inovasi.
• This funding round also saw investment from new partners SWC Global, Endeavor Catalyst, and Uni-President Asset Holdings.

• Indonesia-based digital mortgage startup Ringkas has secured US$3.5 million in a seed funding round led by East Ventures and Crestone Venture Capital.
• 500 Global, Teja Ventures, Orvel Ventures, and Hustle Fund also participated.
• Ringkas will use the fresh funds to advance and scale its platform across multiple cities in Indonesia and the secondary market.

• Mitra Keluarga (MIKA IJ) recently booked 1Q2023, where headlines did not reflect the true recovery of the core business given COVID was still a factor boosting last year’s revenues. 
• Non-COVID inpatient and outpatient volumes were up by +19% YoY reflecting the strength of the recovery as the environment normalizes but occupancy rates still have a significant upside.
• Mitra Keluarga has started to put foot-to-pedal in terms of expanding new hospitals and increasing capacity at existing hospitals combined with increased efficiencies. Valuations are attractive versus history.

• Financial illiteracy has become a global problem, leading many to make uninformed, crippling decisions. This is especially true in Indonesia.
• With informal financing and predatory lending running rife, the country has a financial literacy rate of 38%.
• SkorLife, a credit builder based in the country, looks to change this. Founded by Ongki Kurniawan and Karan Khetan in 2022, the startup allows users to check their credit scores from Indonesia’s bureaus.

• Indonesian agritech startup eFishery has raised US$108 million in series D funding, pushing its post-money valuation to US$1.3 billion, according to VentureCap Insights, which tracks regulatory filings.
• The latest round is led by 42xfund and it saw participation from existing investors Northstar Group and SoftBank Vision Fund II.
• EFishery last raised US$90 million in a series C funding round in January 2022.

• JumpStart Coffee, an Indonesian startup that makes smart coffee machines, has raised an undisclosed amount in a series B round led by Cool Japan Fund and Living Lab Ventures.
• Founded in 2018, JumpStart specializes in manufacturing vending machines that can serve over 20 types of coffee and non-coffee drinks.
• The startup said it has installed 2,000 machines in the Greater Jakarta Area, Bandung, and Surabaya.

• NFC Indonesia (NFCX IJ) provides exposure to Indonesia’s O2O ecosystem as a technology-driven digital product aggregator, FMCG supplier, and advertiser covering modern trade, general trade, and e-commerce. 
• The company provides screen-based iCloud-enabled indoor advertising across mini-markets and increasingly for general trade. This provides a high-margin recurring income base which only currently covers 50% of mini-markets currently.
• NFCX is the current leader in the 2W EV market in Indonesia through its Volta brand, with the most extensive battery swapping buildout, and with further capacity expansion to come.

• Indocement overperformed the overall Indonesian cement market in 1Q2023 in terms of growth, especially in the bulk market, where it also benefited from the contribution from its Maros plant. 
• The company kept costs under control with 100% use of DMO coal during 1Q2023 despite the lower use of alternative fuels due to heavy rains and margins consequently improved. 
• There is still some lingering cost pressure from gypsum and kraft paper but these are expected to subside by 2H2023, with Indocement’s volumes expected to increase +15-20% as demand recovers.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• Meituan
• Tata Motors ADR

• GoTo released a Newsletter for May which reiterated its progress toward profitability as well as some key initiatives including increasing service fees and expanding use cases for GoPay Coins rewards.   
• The newsletter also highlighted the release of the Annual Report and its Sustainability report, which are both important documents for longer-term and increasingly ESG-focused investors. 
• GoTo also highlights a report from the University of Indonesia regarding the company’s socioeconomic impact in the country, which remains huge given its socio-economic reach through ODS and Tokopedia. 

Lucror Analytics Weekly Wraps provide an overview of all Morning Views comments and reports published by our analyst team in the past week, and also showcase a list of the most-read reports.

In this Insight:

1. Lenovo
2. Vedanta Resources
3. China Jinmao Holdings
4. Lifestyle International Holdings
5. Geely Auto

and more…

The Asia HY Trade Book for May 2023 includes a summary of our recommendations, as well as our high-conviction ideas. The report also features relative-value charts and lists of the bonds across Asia (ex-Japan) HY and crossover credits.