Daily Brief Indonesia: AKR Corporindo, Bank Negara Indonesia Persero, GoTo and more

In today’s briefing:

AKR Corporindo (AKRA IJ) – A Winning Formula

AKR Corporindo1Q2023 results demonstrated its resilience with its petroleum and chemicals division continuing to grow in 1Q2023 with the added kicker of a large land sale at JIIPE.
The company’s JIIPE Industrial Estate will become an increasingly important earnings contributor but chemical distribution will be driven by smelters and fuel by the BP retail JV at the margin,
AKR Corporindo is an increasingly interesting proxy for the next stage of Indonesia’s economic growth through its exposure to smelters through its chemicals business and the overall economy through fuel.

Bank Negara Indonesia achieved a strong set of 1Q2023 numbers despite moderate loan growth, where the headline masked some significant growth areas, whilst asset quality improvements led to lower provisions.
The bank continues to stride ahead with its digital initiatives with a multi-touchpoint approach, which has led to increased transactions and a positive impact on CASA and hence funding costs.
Bank Negara Indonesia remains an interesting proxy to the overall Indonesian economy through its high exposure to corporate and consumer lending. Valuations are attractive on 1.1x PBV for 15% ROE.

GoTo (GOTO IJ) reported 1Q2023 results yesterday. Gross revenue increased 14.3% YoY to IDR5.98trn while adjusted EBITDA losses further declined to IDR3.52trn from IDR5.94trn in 1Q2022.
However, all growth matrices point towards a slowdown compared to the previous quarter with gross revenues of all segments and On-demand take rate declining QoQ in 1Q2023.
With GoTo prioritising profits over growth, we expect the company’s growth rates to further decline and wonder if the company could hold it for long?

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