In today’s briefing:
- Bukalapak (BUKA IJ) – Eureka Moment with Better Visibility Ahead
- Indonesian Banks Screener; Negara Stands Out on Value, Growth Potential and Improving Return Trends
Bukalapak (BUKA IJ) – Eureka Moment with Better Visibility Ahead
- Bukalapak released its 1Q2024 results this week with some palpable relief as it booked its first adjusted EBITDA but underlying revenue growth remains strong, especially for its O2O business.
- The company saw take rates improve for both its Mitra O2O business and its marketplace businesses, helping to drive revenue growth. Costs were also reduced allowing for positive contribution margins.
- Bukalapak is expected to see sustainable profitability accompanied by revenue growth, with the marketplace recovering with improving product mix. BUKA’S “orphan” cash pile remains an issue but valuations are attractive.
Indonesian Banks Screener; Negara Stands Out on Value, Growth Potential and Improving Return Trends
- Bank Negara stands out versus its peers for its value attributes, its attractive PEG ratio, and its improving pre- and post-provision returns with top NPL coverage relative to its peers
- Bank Mandiri remains a buy for its quality attributes, its premium returns, and its well-controlled CoR; Mandiri has a far better valuations-to-returns mix than mega-cap BCA
- Bank Rakyat comes off the sell list; it registered improved pre-provision returns in 1Q24, and although cost of risk worsened, post-provision returns were maintained along with its NPL coverage ratio
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