GlobalCOAL NEWC Index

WEEKLY NEWC Index
02-Jan-09 79.19
09-Jan-09 81.44
16-Jan-09 81.46
23-Jan-09 88.19
30-Jan-09 83.15


MONTHLY NEWC Index
Oct-2008 106.92
Nov-2008 91.36
Dec-2008 78.18

GlobalCOAL

Coal Supply at Newcastle, Australia to Improve, Macquarie Says Coal supplies from Newcastle, Australia, the world’s biggest export harbor for the fuel, may improve with the end of disruptions caused by rain and equipment, Macquarie Group Ltd. said.
Prices at the port rose 8.3 percent to $88.19 a metric ton in the week ended Jan. 23, the highest since the week ended Nov. 14, according to the globalCOAL NEWC Index. Traders have been “scrambling to secure” coal, London-based analyst Jim Lennon said in a report today. Supplies were disrupted last month by rain and “equipment issues,” he said.
“Newcastle’s strength is driven by short-term supply issues rather than rebounding demand,” Lennon said. “The spate of physical buying seems now to have abated and we believe the tightness in Newcastle should resolve itself.”
Newcastle prices have tumbled from a record $194.79 in July. Demand for coal weakened as manufacturers cut production and the global economy slowed. Industrial output in Japan, Asia’s biggest economy, probably fell 8.9 percent last month, a Bloomberg survey showed. World economic growth will be 0.5 percent this year, the weakest postwar pace, the International Monetary Fund estimates.
Australian producers and traders still expect annual coal supply deals with Japanese customers to be priced at $85 a ton, Lennon said. The fuel is currently selling at $125 under contracts that typically run from April 1.
“Unless there are significant supply disruptions, a Japanese settlement at $85 a ton would appear to defy market logic,” Lennon said. “Other Asian customers would not accept contracts at such a premium to the market. We continue to think spot prices should retreat toward $65-70 a ton and contracts on this basis should be settled at around $75 a ton.”
Bloomberg - 29-Jan-09

PalmoilHQ CPO

Malaysian crude palm futures rose nearly 2 per cent yesterday as more investors streamed back into the market, heartened by concerns of sharp falls in domestic production this month, traders said.
Palm oil, used in biscuits to biofuels, bounced from three-week lows hit the previous day and snapped three straight days of losses although weakness in US soyaoil markets cut some gains in Asian trade.
“There is some talk that January production might have fallen by 20 per cent, which is the result of plantations cutting down on fertilisers six months ago during the palm price slump,” a head trader with a local brokerage said.Output would then probably be 1.19 million tonnes in January compared with 1.48 million the month before, traders say.
The benchmark April contract closed up RM34 at RM1,779 as traders were also taking positions ahead of a long holiday weekend. The Malaysian palm oil market will be closed on Monday.
Other traded contracts ranged between a RM20 drop to gains of RM40. Overall volume shot up to 13,970 lots of 25 tonnes from 10,000 lots.
Traders were also eyeing Jan. export data by cargo surveyor Intertek Testing Services due over the weekend while Societe Generale de Surveillance reports on Monday.
Exports are expected to be bearish given the deepening recession. - Reuters

Detikfinance Perbankan

Jakarta - Untuk lebih memperkuat sistem perbankan nasional di tengah kondisi krisis global yang masih berlangsung, Bank Indonesia memperpanjang masa transisi penerapan risiko operasional dalam perhitungan kecukupan modal (CAR) perbankan dalam rangka Basel II.Hal ini dikatakan oleh Deputi Gubernur BI Muliaman D. Hadad dalam jumpa pers di Gedung BI, Jalan Thamrin, Jakarta, Jumat (30/1/2009)."Bank Indonesia mengambil kebijakan untuk memperpanjang transisi penerapan risiko operasional dalam perhitungan kecukupan modal dalam rangka Basel II dari semua direncanakan dilakukan pada Juli 2009 menjadi diterapkan secara bertahap," tuturnya.Jadi penerapan aturan Basel II ini akan dilakukan bertahap dengan perhitungan beban modal berdasarkan persentase terhadap rata-rata pendapatan bruto positif tahunan selama tiga tahun terakhir dengan jadwal sebagai berikut:
5% harus dipenuhi sejak 1 Januari 2010 sampai dengan 30 Juni 2010;
10% harus dipenuhi sejak 1 Juli 2010 sampai dengan 31 Desember 2010;
15% harus dipenuhi pada 1 Januari 2011.Basel II merupakan aturan standar internasional perbankan yang dikeluarkan oleh Bank for International Settlement (BIS). Aturan Basel II akan menekankan pentingnya manajemen risiko bank sehingga mendorong bank semakin efektif memanfaatkan besaran modal untuk menutup segala potensi risiko, termasuk risiko kredit. Penundaan PSAKKemudian sebagai tindak lanjut keputusan penundaan pemberlakukan PSAK No.50 dan PSAK No.55 dari 1 Januari 2009 menjadi 1 Januari 2010, BI telah menerbitkan Surat Edaran mengenai pemberlakuan Pedoman Akuntansi Perbankan Indonesia (PAPI) 2008."PAPI merupakan acuan bagi bank dalam menyusun dan menyajikan laporan keuangan sesuai PSAK dan ketentuan lain yang berlaku," ujar Muliaman.Penerbitan PAPI dilakukan lebih awal untuk memberi waktu bagi bank dalam memahami dan mempersiapkan secara matang berbagai hal yang diperlukan, antara lain proses bisnis, sistem teknologi dan informasi akurat serta persiapan sumber daya manusia terkait.Perbankan sebelumnya mengajukan penundaan Pernyataan Standar Akuntansi Keuangan (PSAK) 50 dan 55 di tengah ketatnya likuiditas. PSAK 50 mengatur tentang penyajian dan pengungkapan instrumen keuangan sementara PSAK 55 mengatur tentang penyajian dan pengungkapan instrumen keuangan. Rencananya, BI akan mewajibkan bank menyampaikan laporan keuangan dengan mengacu pada revisi kedua PSAK tersebut mulai 1 Januari 2009.Penerapan PSAK 50 dan 55 diharapkan dapat mendorong proses harmonisasi penyusunan dan analisis laporan keuangan dan disiplin pasar.(dnl/qom)

Detikfinance BMRI

Jakarta - PT Bank Mandiri Tbk akan tetap mempertahankan rasio pemberian dividen sebesar 50 persen dari laba bersihnya. Sementara dividen khusus hingga kini belum diputuskan.Demikian disampaikan Dirut Mandiri Agus Martowardojo di sela-sela peluncuran e-toll card di Plaza Mandiri, Jakarta, Jumat (31/1/2009)."Kelihatannya pola yang kita ada kebijakannya adalah pembayaran dividen di kisaran 50 persen. Kalau saat lalu itu spesial dividen itu kan sifatnya tidak rutin, yang ingin kita jaga dan memperoleh persetujuan pemegang saham adalah pembayaran di kisaran 50 persen," urai Agus.Di tempat yang sama, Menneg BUMN Sofyan Djalil mengatakan bahwa dividen BUMN memang sebagian akan diturunkan dibawah 50%. Menurut Sofyan, yang paling penting dari dividen bukan lah persentasenya, tapi jumlahnya."Yang penting jumlahnya kan. Kalau misalnya jumlahnya disepakati, nanti kita distribusikan berapa dan ambil dari mana," ujarnya.Bahkan sejumlah BUMN kemungkinan tidak akan dipungut dividen, misalnya Jamsostek. Namun ada pula BUMN yang akan dimintakan dividen khusus."Ada yang di bawah (50%), ada yang diatas. Nanti kita lihat satu per satu," katanya.Yang pasti, setoran dividen BUMN itu akan dilihat berdasarkan tingkat keuntungan, kebutuhan pendanaan BUMN bersangkutan dan juga kebutuhan APBN.Kinerja MandiriAgus juga menyatakan, sejauh ini kinerja Mandiri cukup baik, sehingga bank BUMN terbesar itu tidak ada niatan untuk menerbitkan subdebt dalam rangka meningkatkan rasio kecukupan modal atau CAR."Itu tidak perlu subdebt karena kita masih punya permodalan kira2 16-17 persen. Jadi kalau seandainya kita lihat kebutuhan baru akan kita keluarkan," katanya.Selain itu, Mandiri juga memiliki Dana Pihak Ketiga (DPK) valas yang akan cukup untuk mendukung pinjaman valasnya. Per Desember 2008, LDR valas Mandiri mencapai 80% atau turun dibandingkan posisi per tahun 2007 yang sebesar 125%."Sekarang ini posisi dana lebih sekitar US$ 1,6 miliar. Jadi kita punya dana valas likuid, jadi kalau ada kebutuhan pendanaan ataupun pelunasan tentu kita dalam posisi melunasi itu. Tapi kita harus hati-hati," katanya."Kalau seandainya ada pinjaman luar negeri valas tentu sekarang kalau bisa diperpanjang akan diperpanjang tapi seandainya terlalu mahal kita akan lunasi," imbuh Agus. Mandiri juga menargetkan pertumbuhan kredit sebesar 16 persen di tahun 2009. Angka itu berarti revisi dari target sebelumnya."Untuk pertumbuhan kredit 2009, waktu budgeting awalnya 22-24 persen, terus turun ke 15-16 persen. Angka finalnya 16 persen," ungkapnya.Menurutnya, Mandiri melakukan revisi target pertumbuhan kredit setelah mendengar rencana IMF untuk menurunkan tingkat pertumbuhan ekonomi dunia."Ini membuat semua orang takut. Posisi 16 persen ini yang kita yakin berada di posisi yang wajar," kata Agus.(ang/qom)

Samuel ANTM

• Rising nickel inventories in LME amid weak demand. Tingkat persediaan nikel di
London Metal Exchange (LME) mencapai level tertinggi sebanyak 82,764 MT akhir
Jan’09, naik 5.6% YTD’09 dan 76.8% YoY. Meningkatnya persediaan nikel merupakan
dampak dari perlambatan pertumbuhan ekonomi global, terutama di AS dan China.
Konsumsi nikel global diperkirakan turun sebesar 30% tahun ini karena turunnya
permintaan stainless steel dari Eropa dan melambatnya pertumbuhan ekonomi China,
yang diperkirakan hanya tumbuh 7% di FY09. Ke depannya, perusahaan nikel dunia
akan melakukan pemotongan produksi untuk mengurangi kerugian.
• Nickel price remains low whilst gold relatively stable. Tingginya persediaan
menyebabkan harga nikel anjlok 65% dari level peak ke US$11,710/ton (US$5.3/lb).
Kami memperkirakan harga nikel masih dalam tren bearish karena turunnya
permintaan dunia akibat resesi global. Namun kami netral terhadap emas yang
merupakan alternatif investasi yang aman disaat resesi global. Produk nikel memberi
kontribusi sekitar 75%, sementara kontribusi emas sekitar 20% terhadap pendapatan
Antam. Asumsi harga jual rata-rata nikel kami sebesar US$5.5/lb dan emas sebesar
US$800/ton di FY09.
• Cut nickel production by 29%. Antam berencana menutup 1 smelter nikel di 2Q09
sehingga total produksi nikel turun menjadi 12,000 ton (dari rencana awal 17,000 ton).
Kami melihat masih ada potensi Antam untuk menurunkan produksi nikel seiring
dengan rendahnya permintaan nikel dunia. Sensitivity analysis kami menunjukkan
setiap penurunan 1,000 ton nikel, pendapatan Antam berpotensi turun sebesar 3%.
• Diversification and cash rich equal higher survival. Margin operasional Antam
akan tergerus di FY09 akibat turunnya harga jual nikel dan produksi, sementara
laba bersih diperkirakan turun 68% YoY menjadi Rp682 miliar. Namun dengan
posisi neraca yang sehat ( net cash sebesar Rp2.9 tr) dan bisnis yang lebih
terdiversifikasi (feronikel, emas, perak, bauksit), kami perkirakan Antam akan
mampu bertahan dalam kondisi sulit saat ini. Kami mendowngrade target harga
menjadi Rp1,000 namun mempertahankan rekomendasi HOLD. MAINTAIN HOLD

UBS BUMI

Recent actions underline legacy risk
Bumi Resources’ (Bumi) most recent corporate actions underline the legacy risk,
which has been associated with the Bakrie group since the US$1.2bn debt default
in 1998, and was heightened following the 2006 Lapindo mudflow disaster. We
advise caution considering the absence of an EGM to ensure shareholder approval
for the most recent acquisitions, but highlight the possibility of a near-term EGM,
given ongoing pressure from state financial regulator, Bapepam.
Street’s valuation analyses inconsistent and premature
We question recent broker valuations, which apply new risk premiums to Bumi, as
we argue such premiums should have been applied long ago, in line with the longtime
legacy risk. We believe incorporating more conservative assumptions, such as
higher capex and cost of debt, is more prudent, instead of applying arbitrary risk
premiums that try to capture negative market sentiment.
Acquisitions value accretive with manageable gearing
We believe Bumi’s three recent acquisitions are value accretive, which is contrary
to recent broker reports. Our bear-case valuation scenarios of the acquisitions
would add 21% to Bumi’s share price, while we do not expect net gearing levels to
exceed our 2008 peak estimate of 1.1x.
Valuation: maintain price target of Rp1,600
Our 2009 earnings estimates are 33% below consensus. Our Rp1,600 price target is
based on a 2009E PE of 7.5x and a WACC of 15%.

PalmoilHQ CPO

PETALING JAYA: India’s decision not to impose import duty on crude palm oil (CPO) while maintaining a 20% duty on soybean oil is expected to boost CPO exports to the continent, at least in the first quarter of this year.
Despite mounting pressure by domestic oil producers’ associations to re-impose import duties on all edible oils, analysts said the Indian government was reluctant to impose duty on CPO – the world’s cheapest edible oil – ahead of the country’s general election, as it would be more expensive for local consumers.
AmResearch analyst Gan Huey Ling said the latest development in India was positive as “the tax differential between CPO and soybean oil enhances the attractiveness of CPO, which is now trading at a price significantly below soybean oil”.
Based on Malaysian Palm Oil Board statistics, the international price discount between CPO and soybean oil was US$235 per tonne last December against US$336 per tonne in the previous month.
“We believe that the absence of an import duty on palm oil would smooth out the flow of Malaysian palm oil exports to India, instead of just short-term demand spikes ahead of possible import duties,” Gan said.
Earlier, there was talk that the CPO import duty would be imposed before India’s election in May. It is believed that the Indian government was reluctant to impose the duty which could lead to an increase in the prices of key commodities although inflation had fallen below 6%.
In April 2008, India removed the duties on all vegetable oils to keep prices at bay, given its soaring inflation rate.
However, it imposed a 20% duty on soybean oil last November after the global prices of edible oils fell.
India used to be the largest importer of Malaysian palm oil before being replaced by China in 2002.
China overtook India as the biggest importer of Malaysian palm oil due to the growth of its economy, the abolishment of palm oil quota system and the fact that it imports palm oil mainly in refined form.
India imports its CPO mainly from Indonesia while from Malaysia, it imports mostly refined, bleached and deodorised (RBD) palm olein. India imports about 65,000 tonnes of palm oil from Malaysia every month.
ECM Libra Investment Research said in its latest report that the plantation industry was on a clear path to healthier times after a major oversupply situation.
Last month, local palm oil exports rose some 197%, driven by demand from India.
“We believe this is due to pre-stocking activities towards the implementation of import tax on palm oil. This could also be in reaction to the import tax imposed on soybean oil that was put into place in November,” ECM Libra said.

Detikfinance BUMI

Jakarta - Badan Pengawas Pasar Modal & Lembaga Keuangan (Bapepam-LK) sedang melakukan pemeriksaan terhadap tim penilai independen yang ditunjuk PT Bumi Resources Tbk (BUMI)."Sedang kami periksa. Nanti kita umumkan hasilnya kalau sudah ada," ujar Kabiro Penyelidikan dan Pemeriksaan Bapepam, Sardjito di kantornya, Lapangan Banteng, Jakarta, Jumat (30/1/2009).BUMI baru saja menandatangani perjanjian akuisisi 80% saham Zurich Asset Investments senilai Rp 2,412 triliun pada 30 Desember 2008. Kemudian pada 5 Januari 2009, BUMI mengambil alih 76,8% saham PT Fajar Bumi Sakti (FBS) senilai Rp 2,475 triliun. Terakhir, pada 7 Januari 2009 BUMI mengambil alih 84% saham PT Pendopo Energi Batubara (PEB) senilai Rp 1,304 triliun.Mekanisme pembayarannya dilakukan secara bertahap selama 3 tahun. Pembayaran pertama (down payment/DP) ke Zurich dilakukan sebesar Rp 492 miliar. Pada FBS, BUMI hanya membayar Rp 156 juta dan kepada PEB sebesar Rp 841 juta. Total dana yang dikucurkan BUMI untuk DP akuisisi hanya sebesar Rp 492,997 miliar.Kemudian selama satu tahun pertama BUMI akan mengucurkan pembayaran sebesar Rp 1,015 triliun, terdiri dari pembayaran pada Zurich sebesar Rp 359 miliar, FBS Rp 430 miliar dan PEB Rp 226 miliar.Pada tahun kedua, BUMI akan mencicil Rp 3,122 triliun. Rinciannya, ke FBS Rp 2,045 triliun dan PEB Rp 1,077 triliun. Pada tahun kedua BUMI tidak melakukan pembayaran pada Zurich. Tahun ketiga, BUMI hanya akan melakukan pembayaran kepada Zurich sebesar Rp 1,561 triliun.Untuk keperluan akuisisi Zurich dan Pendopo, BUMI menunjuk Yanuar Bey dan Rekan sebagai tim penilai independen. Untuk akuisisi Fajar Bumi Sakti, BUMI menunjuk Ernst & Young sebagai tim penilai independen."Sekarang kita sedang memeriksa Yanuar Bey," ujar Sardjito.Sayangnya, Sardjito tidak menyebutkan detail hal yang sedang diperiksa. Namun Ketua Bapepam Fuad Rahmany pekan lalu mengatakan, tujuan pemeriksaan adalah melakukan klarifikasi atas perbedaan pendapat antara rumor yang beredar di pasar dengan apa yang dijelaskan manajemen BUMI.Akuisisi tersebut semula dinilai memiliki benturan kepentingan dan nilai akuisisinya terlalu mahal dan berada di atas harga wajar.Menanggapi hal ini, SVP Investor Relations BUMI Dileep Srivastava menegaskan bahwa tidak ada yang dilanggar dalam akuisisi senilai Rp 6,191 triliun tersebut.BUMI sudah menyiapkan pendapat hukum (legal opinion) dan siap maju ke pengadilan jika diperlukan.(dro/ir)

CIMB GGRM

Gudang Garam's commitment to change brings hopes that the giant producer could be making a comeback. With a new distribution system in place, gross margins are expected to fare better as the company increases its control over distributors and negotiates for higher margins. In addition, Indonesia's new excise tax system for cigarettes favours the bigger players, potentially squeezing out competition. We initiate coverage of Gudang Garam with an Outperform rating and DCF-based target price of Rp7,150 (13.8% WACC, 5% LTG). This implies 7.3x and 6.5x CY09-10 core earnings respectively.

Bloomberg Indika

UPDATE 1-Noble, Indika eye stake in Straits Asia Resources
HONG KONG/PERTH, Jan 30 (Reuters) - Commodities firm Noble Group and Indonesian coal miner PT Indika Energy Tbk are among the companies pursuing a bid for Straits Asia Resources , according to sources familiar with the matter, in a deal that could be worth more than $800 million.
Bidders are setting their sights on the two Indonesian coal mines that the Singapore-listed company controls. Its stock rose 10 percent to S$0.91 on Friday after Reuters first reported the interest of Noble and Indika.

Bloomberg Coal Loading at Xstrata’s Abbot Point

Jan. 30 (Bloomberg) -- The Abbot Point coal port, an export terminal in Australia operated by Xstrata Plc, has stopped loading vessels after its only loader was blown off its tracks during a storm late yesterday.
The loader “is going to be out action for a few days,” Graham Rawlings, general manager commercial at the port, said today by phone. “We have commenced an investigation into the incident.”
The port, located 25 kilometers (16 miles) north of the town of Bowen in central Queensland, ships coal from mines including Newlands and Collinsville and has a capacity of 21 million metric tons. Abbot Point shipped 12.5 million tons of coal in the year ended June 30, according to the port’s Web site.
To contact the reporter on this story: Jesse Riseborough in Melbourne at jriseborough@bloomberg.net

Bloomberg Crude Oil May Rise as OPEC Members Cut Production

Jan. 30 (Bloomberg) -- Crude oil may rise as the Organization of Petroleum Exporting Countries reduces production to counter the recession in major consuming countries.
Twelve of 32 analysts surveyed by Bloomberg News, or 38 percent, said futures will increase through Feb. 6. Ten respondents, or 31 percent, forecast oil will fall and 10 said there will be little change. Last week, 43 percent of analysts expected prices to increase.
OPEC announced a record 9 percent cut in supply targets at a Dec. 17 meeting to bolster prices. The reduction took effect on Jan. 1. U.S. crude oil inventories rose 6.22 million barrels last week to 338.9 million barrels, the highest level since August 2007, the Energy Department reported on Jan. 28.
“Although U.S. crude oil inventories are still climbing, it’s about time for the OPEC production cuts to have an impact,” said Tim Evans, an energy analyst with Citi Futures Perspective in New York.
Crude oil for March delivery has declined $5.03, or 11 percent, to $41.44 a barrel so far this week on the New York Mercantile Exchange. Prices have dropped 72 percent from the record $147.27 a barrel reached on July 11.
The oil survey has correctly predicted the direction of futures 48 percent of the time since its start in April 2004. Bloomberg’s survey of oil analysts and traders, conducted
each Thursday, asks for an assessment of whether crude oil
futures are likely to rise, fall or remain neutral in the coming
week. The results were:
RISE NEUTRAL FALL
12 10 10
To contact the reporter on this story: Mark Shenk in New York at mshenk1@bloomberg.net.

Detikfinance Surat Utang Negara (SUN)

Jakarta - Perdagangan harian seluruh produk surat utang negara (SUN) di bulan Januari 2009 anjlok hingga 39,47% dibanding rata-rata perdagangan SUN harian di 2008. Pasar obligasi diperkirakan membaik di semester II-2009."Perdagangan SUN harian Januari 2009 sebesar Rp 2,3 triliun," ujar Direktur Perdagangan Fix Income dan Derivatif, Keanggotaan dan Partisipan Bursa Efek Indonesia, Guntur Pasaribu di gedung Departemen Keuangan, Lapangan Banteng, Jakarta, Jumat (30/1/2009).Guntur mengatakan, rata-rata perdagangan SUN harian di 2008 sebesar Rp 3,8 triliun. Mengacu pada angka tersebut, perdagangan SUN harian di pasar sekunder selama Januari 2009 anjlok hingga 39,47%.Hal serupa juga terjadi pada perdagangan harian produk obligasi korporasi. Per 29 Januari 2009, rata-rata perdagangan harian obligasi korporasi di pasar sekunder sebesar Rp 146 miliar, turun 32,71% dibanding posisi di akhir 2008 sebesar Rp 217 miliar."Menurunnya perdagangan harian obligasi maupun SUN di pasar sekunder lebih disebabkan oleh kondisi ekonomi global dan masih tingginya tingkat suku bunga acuan bank," jelas Guntur.Oleh sebab itu, Guntur melanjutkan, likuiditas pasar obligasi jadi seret. Alasannya, yield (imbal hasil) yang diterima oleh investor jika ia membeli di pasar sekunder tidak terlalu menguntungkan karena suku bunga acuan bank sedang tinggi."Jadi kebanyakan pemegang obligasi maupun SUN memilih hold to maturity. Dalam arti, mereka lebih suka mencari keuntungan dari kupon bunga ketimbang mencari gain dari pasar sekunder," jelas Guntur.Guntur memperkirakan pasar obligasi akan kembali atraktif di semester II-2009. Menurutnya, seiring dengan membaiknya kondisi ekonomi, suku bunga acuan bank juga akan menurun, sehingga akan kembali mendorong minat investor di pasar obligasi.(dro/qom)

CLSA TINS

Timah – 2008 indication down 21% YoY
Timah indicated that its net profit in 2008 would reach Rp1.4tn down by 21% YoY.
The result was 35% below consensus estimate. Note that the fall in profit came despite a 30% increase in average tin price last year. Management was quoted stating that profit affected by a much higher input costs, particularly ore.
This, in our view, suggests the company’s vulnerability in managing its costs as Timah has relied to and been buying tin ore from the so-called unconventional miners (effectively illegal miners working on Timah concession area) and price for this ore is somewhat linked to the spot tin price. Timah, therefore, has not been able to enjoy the full upswing in margin during the commodity boom.
The management is targeting a flat YoY production and sales of around 46k tonnes in 2009. With tin price hovering around US$11,000/t as compared to last year average of US$18,500/t, we might see another year of declining profit.

CLSA PTBA

Bukit Asam – 2008 earnings indication slight below, comfortable with 2009 outlook
CEO indicated that net profit in 2008 could reach Rp1.8tn, suggesting a 140% increase YoY. The result however came in slightly below consensus and our estimates by around 5% to 10%. Management explained that there were partly one-off costs coming from underpayment of royalties, accumulated since 2005, following audit from state audit body, and changes in calculating pension benefits.
We remain comfortable with our 2009 earnings estimates, which is already 11% below consensus. We have assumed a 15% lower-than-management-guidance price for coal sola to PLN, while our crude oil price assumption of US$60/bbl looks conservative as well compared to the current spot price of around US$40/bbl. Meanwhile, our sales volume target for 2009 of 14.1m tonnes is around 1m tonnes below management guidance.
We maintain our Outperform rating on Bukit Asam with TP of Rp8,800. Our preferred coal play in ITM (ITMG IJ) with Tp of Rp16,600, given its strong balance sheet, high portion of contracted tonnage that translates to good earnings visibility, and good dividend yield as the company pays 60% of earnings as dividend.

CLSA BBCA

BCA superior bank, limited upside

Nicolaos Oentung lowers our earnings estimate for on Bank Central Asia (BBCA IJ). No change in recommendation, though. Maintain OPF call and TP at Rp2,800.

Limited upside, but defensive fundamentals (excellent franchise: large, stable, and low cost funding base) will support profitability under current weak environment. Not cheap at 2.6x 09 P/B, but under this kind of environment the stock is a safe heaven (relatively speaking).

Nico highlights 1 interesting point: BBCA’s deposit margin (risk free margin, i.e. SBI minus cost of funds) is likely to fall going forward. It has peaked and will start to contract in 09, in our view. We now assume deposit margin to contract by 90bp in 09 and remain stable in 2010.

We downgrade our 09-10 earnings by 12-13% due to slower revenue production resulting from a more modest NIM expansion. Despite lower deposit margin, NIM will still expand
from 5.8% in 08 to 6.1% vs. 6.8% previously due to steady loan growth. We forecast earnings to be flat in 09, before rising by 19% in 2010.

Key points from the report:

• We believe BBCA’s deposit margin has peaked and will start to contract in 09 given cost of funds is at all time low and interest rates are falling rapidly.
• Provision for loan losses will also rise to as exporters suffer from falling commodity prices and weakness in global growth
• We downgrade earnings by 12-13% in 09-10 to reflect lower NIM due to deposit contraction
• Maintain O-PF as BCA has defensive fundamentals and perceived as safe haven under current weak environment
  

Morgan Stanley UNTR

UNITED TRACTORS (UNTR.JK): LOW EXPECTATIONS; HIGH UPSIDE; REITERATE OW What's Changed Price Target: Rp6,500 to Rp5,7002009-11 EPS Estimates : Up by an average of 5%We reiterate our OW rating on United Tractors (UNTR), even though we are cutting our PT on the stock to Rp5,700, as it still offers 15% upside from current levels. At our price target, UNTR would trade at a 2009E P/E of 6.9x and a 2010E P/E of 6.0x, well below the stock's trough-cycle P/E of 9.0x, which we believe reflects UNTR's projected three-year EPS CAGR of -4.7%. While we believe UNTR's share price is overshooting to the downside, this situation could present attractive buying opportunities. We advise investors to accumulate UNTR stock, as: 1) the market appears to have factored in a significant decline in UNTR's 2009 machinery sales since 4Q08, and so we see no negative surprise; 2) UNTR's new 2009 machinery sales volume guideline appears to be overly conservative by historical standards, and so upside risks might be in the cards; 3) the machinery sales volume decline may not be affecting UNTR's earnings as much as the Street feared - mining contracting is now the key earnings driver; and 4) a stronger mining contracting business in 2009 could offset the weakness in the machinery division as margin adjustments in 2009 should be followed by normalization in 2010.
Risks to our call: 1) Coal price trend reversal; 2) significant delays in the coal asset acquisitions; 3) steep appreciation of the rupiah vs. the US dollar; 4) execution risks and delays in the timely delivery of the government power plant projects; and 5) political concerns in Indonesia during the general election in 2009.

Morgan Stanley AALI

ASTRA AGRO LESTARI (AALI.JK): MORE CONSERVATIVE LT OUTLOOK; MAINTAIN EW What's Changed Price Target: Rp12,000 to Rp10,500Average FY2009-11e EPS : Up 55%We retain our EW rating on Astra Agro Lestari (AALI) with a new target price of Rp10,500/share, implying 5% downside from the current price. The TP revision is based on: 1) higher rupiah exchange rate assumptions against the US dollar; 2) less aggressive land bank acquisitions and new palm planting program; and 3) flat productivity of the estates in the medium term. While we upgrade AALI's 2009-11e earnings by 55%, which is now 15% ahead of the consensus, we downgrade AALI's long-term total planted area by 27%, resulting in lower DCF-based target price for AALI stock despite the more positive near-term earnings revision. We advise investors to revisit the counter in 2Q09 ahead of the seasonal CPO price strength in 3Q09. We expect CPO price to weaken as we go into 2Q09, given seasonal demand factors, uncertain global macroeconomic outlook, and higher-than-expected CPO supply. We expect attractive buying opportunities in 2Q09 and advise investors to build up positions in AALI ahead of the celebration of Ramadan and Eid Al-Fitr in August-September.
Key risks to our call on AALI stock: 1) lower realized average CPO price below US$550/ton in 2009e, driven by weaker-than-expected consumption growth due to prolonged weakness in the global economy; 2) steep appreciation of the rupiah against the US dollar, causing AALI's rupiah-based earnings to fall; and 3) negative surprises on AALI's CPO production volume amid weaker-than-expected estate productivity levels.

Morgan Stanley ASII

ASTRA INTERNATIONAL (ASII.JK): HIGH EXPECTATIONS, HARSH REALITY; DOWNGRADE UW What's Changed Rating: Equal-weight to UnderweightWe cut our rating on ASII stock to Underweight, even though we keep our TP unchanged at Rp9,500 per share, as the stock implies 26% downside to the current price. At the TP, ASII would trade at 7.3x 2009e P/E - below its mid- and trough-cycle P/E of 9.6x and 8.0x respectively - which captures: 1) a challenging outlook in Indonesia's auto sales in 2009; and 2) the company's projected 3-yr EPS CAGR of -5.7%. ASII recent stock price strength looks vulnerable. ASII's stock has risen 48% in the past two months on perception of auto sales acceleration in 2009 due to the recent interest rate and fuel price cuts. Lower interest rate levels without financing availability, unfortunately, will not be effective in supporting auto sales, in our view, while fuel price levels have minimal correlation on auto sales in the long run. Our analysis suggests that the market is pricing-in 20-30% decline in 2009 auto sales vs. our expectations of a 30-40% contraction.Catalysts:1) weak 1Q09 auto sales plus pressure on 2W market share
- auto sales volume could surprise on the downside and Yamaha's market share might be consistently ahead of Honda's; 2) FY08 financials reporting at end-Feb. 2009 - we expect strong results, a good opportunity to take profit; and 3)1Q09 financials reporting at end-Apr. 2009 - expect weak earnings and consensus earnings revisions.Risks to our call: 1) easing liquidity in the auto financing market; 2) appreciation of the rupiah with low volatility against the US dollar; 3) tame competition in the 2W market; 4) peaceful and successful completion of the 2009 elections; and 5) sharp appreciation of the commodity prices: coal and crude palm oil.

Bahana WIKA

Support from government spending
Ahead of the 2009 elections, we remain bullish on the outlook for the construction sector this year, in spite of the current tight liquidity condition. Within the state budget, the government has allocated IDR61.7t for infrastructure-related spending (please see table 1 for details), of which around IDR17.5t from a total of IDR35t would be spent on making new roads and improving existing roads and facilities as part of the massive government spending program on infrastructure. This year’s road construction program financed by the ministry would prioritize inter-city roads across Java and Sumatra. The other IDR17.5t would be spent on irrigation canals amounting to IDR8t while IDR9.5t would go towards sanitation and other projects. At the local government level, we expect IDR59t to be spent while from the private side some IDR47t could materialize as interest rates further fall in 2H09. Historically, WIKA has participated in various projects such as toll road projects, irrigation canals and power plants.
Power plant projects: Still on track
Having finished two power plant projects, PLTU Celukan Bawang Bali and PLTU Labuhan Angin, in 2008, WIKA still has seven power plant projects in the pipeline. WIKA is also acting as an EPC for steam power plants in South Kalimantan and South Sulawesi, which are both slated for completion in 2010. Additionally, WIKA is doing 2,670MW projects (please see table 2 for details) as part of the government’s 10,000MW coal-fired power plant projects. The management has informed us that in spite of concerns over possible delays, WIKA portions would still remain on track.
Other projects to support performance
WIKA has many planned projects in their pocket including offers to develop bridges and tunnels in Aljazair and Dubai through their subsidiary WIKA beton. Plans to acquire a mining contracting company, valued at IDR35b coupled with 20% investment in Marga Nujyasumo Agung, concession holder of the Surabaya-Mojokerto 77km toll road, should raise WIKA’s revenue, although to be conservative we have excluded these from our numbers.
Upgrading target price to IDR290
We like WIKA’s medium-term plan to increase government proportion for its revenue to 73% from the current 60%. Additionally, we like the company’s well-diversified business, which would cushion the recent adverse impact coming from the unfavorable construction tax regulation. Furthermore, WIKA could benefit from possible future projects which we have not taken into account. Finally, we also like WIKA’s net cash position which would be an advantage given the current tight liquidity condition. We come up with a new TP of IDR290, based on 2009 10x PE, or a 30% premium to the average 2009 Indonesian construction companies. At our new target price, WIKA would still trade on a 20% discount to its regional peers, which are trading on 12x 2009 PE. Thus, we re-iterate our BUY recommendation for the counter.

CIMB Indo Bank

• Early stage of NPL cycle. We do not expect the full NPL hit to be reflected yet in 4Q08 results. Conversely, some banks might even raise their provisioning coverage on successful estructuring. Despite stable industry NPL ratios of around 3.5%, NPLs in absolute amounts have started to rise. In Sep-Nov 08, NPLs rose 12% to Rp46tr, indicating an early stage of the NPL cycle. We believe NPL ratios will escalate very soon, exacerbated by slow loan growth (denominator in the ratio) in 1Q-2Q09. The central bank’s extended requirements for loan grading that incorporate debtors’ business outlook and financial conditions, including the oneobligor concept, will put more pressure on NPLs. Bankers are seeking to renegotiate these terms with the central bank, in hopes of alleviating the indirect NPL shock.
• Liquidity disparity. A series of indicators is suggesting that liquidity has started to ease. Deposit growth has outpaced loan growth in the past few months, contrary to the trend in the first eight months of 2008. The SBI rate has come down quite sharply, closing the gap with the BI rate, on much lower SBI issuance. Nevertheless, some risks remain in the system, as the liquidity disparity appears to be widening. Most big banks have secured enough liquidity, some even more than needed, but small banks are still struggling for deposits. Statistics show that the top
10 banks (out of 126 in Indonesia) have captured two-thirds of industry deposits. Interbank mechanisms have not done much to help, without guarantees on counterparty risks. The donward repricing of deposits could get much slower, creating a lengthier lag for lending-rate repricing.
• Capital constraints. Several years of continuous high loan growth have consumed most banks’ capital adequacy ratios. Industry CAR dropped from 21.3% at Dec 06 to 16.8% at Nov 08, though still well above the 8% requirement. Based on banks’ simulation, the introduction of operational risks in CAR calculations could consume CAR by another 1-3%. Implementation is aimed at 2009-10, but could be postponed by the economic downturn. While banks could fortify their capital by issuing subordinated loans or rights or cutting dividends, some banks could opt to lower their loan growth in these 1-2 years before they are able to get new capital. The latter would be a better option given the current difficulties of raising capital. Fortunately, state banks channelling Kredit Usaha Rakyat (KUR) loans, especially BRI, are gaining more space as the BI cuts the KUR risk weighting to 20% from 85%.
• Maintain Neutral. We have yet to turn positive on the sector, despite lower BI rates. A potential NPL spike is another test for banks, before valuations can be re-rated meaningfully, in our view. State banks have become more appealing on support from the government and SOEs, which reinforces our selection of Mandiri and BRI as top picks. No changes in our forecasts and target prices.

Detikfinance EBA

Jakarta - Setelah menunggu selama 12 tahun sejak aturan Efek Beragun Aset (EBA) diterbitkan tahun 1997, akhirnya pasar modal Indonesia memiliki produk EBA yang benar-benar diterbitkan dan telah mendapat pernyataan efektif dari Badan Pengawas Pasar Modal dan Lembaga Keuangan (Bapepam LK).

Bapepam akhirnya mengizinkan penerbitan EBA untuk pertama kalinya dengan produk bernama Efek Beragun Aset Danareksa SMF I – KPR BTN.

Pernyataan efektif Bapepam itu keluar pada 29 Januari 2009 melalui surat No: S-647/BL/2009. Surat tersebut berisi pernyataan efektif untuk produk investasi baru berbasis sekuritisasi dengan menggunakan wadah Kontrak Investasi Kolektif yaitu Efek Beragun Aset Danareksa SMF I – KPR BTN.

EBA tersebut diterbitkan oleh PT Danareksa Investment Management selaku Manager Investasi yang berfungsi sebagai pengelola dan PT Bank Rakyat Indonesia (Persero) selaku Bank Kustodian yang berfungsi sebagai penyimpan portofolio efek.

Pihak lain yang turut menunjang suksesnya penerbitan produk ini adalah PT Sarana Multigriya Finansial (Persero) yang bertindak sebagai global koordinator dan pembeli siaga.

EBA SMF I – KPR BTN, menggunakan underlying aset berupa kumpulan tagihan Kredit Pemilikan Rumah (KPR) terpilih dari PT Bank Tabungan Negara (Persero) dengan nilai Rp 111,111 miliar yang berasal dari 5.060 debitor. Dengan menggunakan konteks Kontrak Investasi Kolektif sebagai wadahnya.

"12 tahun bukanlah waktu yang singkat untuk kelahiran sebuah produk, namun dengan upaya yang terus menerus bersama pelaku pasar, akhirnya kita boleh berbangga bahwa pada akhirnya pasar modal kita memiliki produk ini," ujar Kabiro Pengelolaan Investasi Bapepam-LK, Djoko Hendratto, Jumat (30/1/2009).

Bapepam berharap dengan hadirnya produk investasi baru ini, bukan saja akan memperkaya alternatif investasi bagi para investor kita tetapi juga dapat menjadi sarana untuk ikut serta mengembangkan sektor riil melalui pembiayaan pasar modal.

"Bagi para Manager Investasi, hal ini dapat dijadikan momentum untuk lebih kreatif dalam mengembangkan produk-produk investasi baru yang akan memperkaya pasar modal Indonesia," ujar Djoko.

EBA merupakan Efek yang diterbitkan oleh Kontrak Investasi Kolektif Efek Beragun Aset yang portofolionya terdiri dari aset keuangan berupa tagihan yang timbul dari surat berharga komersial, pemberian kredit kepemilikan rumah atau apartemen, Efek bersifat hutang yang dijamin Pemerintah, Sarana Peningkatan Kredit, serta aset keuangan setara dan aset keuangan lain yang berkaitan dengan aset keuangan tersebut.(ir/ir)

Detikfinance BBNI

Jakarta - PT Bank Negara Indonesia Tbk (BNI) pimpin sindikasi bank untuk membiayai proyek PLTU Tanjung Awar-Awar, Jawa Timur berkapasitas 2x350 MW. Proyek ini dibangun dengan total biaya investasi sebesar Rp 1,36 triliun.Sumber pembiayaan itu berasal dari pembiayaan bank sebesar Rp 1,16 triliun (85%) dan self launching PLN sebesar Rp 204 miliar (15%). "BNI sebagai lead sindikasi memberikan pinjaman sebesar Rp 635,4 miliar dan bank lain, yaitu BRI sebesar Rp 519,9 miliar. Fasilitas pinjaman berupa kredit investasi pokok ini memiliki jangka waktu kredit 10 tahun termasuk grace periode 3 tahun," tutur Direktur Utama BNI Gatot M. Suwondo dalam siaran pers yang diterima detikFinance, Jumlat (30/1/2009). Menurut Gatot, sektor kelistrikan merupakan salah satu sektor yang memiliki prospek bisnis sangat baik dalam beberapa tahun ke depan. "Hingga kini permintaan pasarnya jauh lebih tinggi dibanding kapasitas PLN memasok listrik ke konsumen," jelasnya. PLTU Tanjung Awar-Awar merupakan salah satu proyek Fast Track Program PLN 10 ribu MW dalam batch 5 paket 1 yang dikerjakan oleh konsorsium China National Machinery Industry Coporation (Sinomach), China National Electric Equipment Corporation (CNEEC) dan PT Penta Adi Samudera. Hingga akhir Desember 2008, komitmen kredit sektor kelistrikan BNI mencapai Rp 8,32 triliun. Proyek-proyek yang telah dibiayai BNI antara lain PLTU Indramayu, PLTU Labuan, PLTU Rembang, PLTU Gas Bumi Wayan Windu, PLTU CIlacap, PLTU Palu, PLTU Bangkalan BUn, PLTU Gas Bumi Sibayak, PLTU cikarang, PLTU Poso dan PLTU Bintan.(dnl/ir)

Palm Oil Updates

Malaysian crude palm oil fell 2.1 per cent to more than three-week lows yesterday, pressured by weak crude and slowing shipments, although traders said drought hurting South American soyaoil could spur demand.
Palm oil, used in products ranging from biscuits to biofuel, have soared by a third from an October 28 low of RM1,331 thanks to falling domestic stockpiles but have failed to stay above RM1,800 due to volatile crude markets and long Lunar New Year holidays.
“The market is very quiet for the holidays, palm producers only enter the market in the mornings and then get out in the afternoon,” said a trader with a foreign commodities brokerage.

The benchmark April contract on the Bursa Malaysia Derivatives Exchange closed down RM37 to stand at RM1,745, a level unseen since January 5.
Other traded contracts fell between RM17 and RM41. Overall volume slumped to 6,982 lots of 25 tonnes each from about 10,000 lots as many traders were still away for Lunar New Year following market closures on Monday and Tuesday.
Exports of Malaysian palm oil products for Jan. 1-25 fell 29.2 per cent to 952,478 tonnes from 1,345,325 tonnes shipped between Dec. 1 and 25, cargo surveyor Intertek Testing Services said on Wednesday.
Another cargo surveyor, Societe Generale de Surveillance, reported declines of 24.1 per cent to 1,016,477 tonnes. - Reuters

Credit Suisse PGAS

• To encourage more gas use, Perusahaan Gas Negara (PGAS) is set to cut surcharge for customers in West and East Java. Customers are currently charged 50% additional on price for the use of gas more than 100% of the contracted volumes, due to limited gas supply. They are also required to pay ‘take or pay’ of 80%, if they consume below this level.
• PGAS has the track record for reducing distribution volumes target. However, we now believe that 2009 is the major growth year as the company has secured gas contracts to PLN (Perusahaan Listrik Negara), the state-owned power company (not listed), which would take one-third of its distribution volumes.
• The gas price decline is unlikely as PGAS’ selling price remains at 40% of the subsidised diesel price. Please note that industrial customers have to pay for non-subsidised diesel. The weakening in oil price, however, provides negative sentiment on the stock which we believe should be taken as an opportunity to accumulate.
• We assume no gas price increase. PGAS’s gas pricing is set by the BOD decree. Customers are charged based on the contracted volumes and the location to reflect the distribution fee. PGAS currently has more gas supply than what it sells. Therefore, to encourage more gas use by customers, the company cut the surcharge for additional gas over the contracted volumes.
• The company also claims that very few customers use more than the contracted volume, in fact they tend to use below the contracted volume. Therefore, the lifting of surcharge would not have a significant impact on its average realised price.
  We have taken a conservative approach by assuming no gas price increase for this year and next. Since the purchase prices from the upstream oil and gas companies have increased, we have assumed that PGAS would be able to pass on the increases in gas costs to its customers, to maintain distribution margins. Increasing distribution volume. PGAS has the track record for missing its own volumes target, primarily due to the delay of the South Sumatra West Kava (SSWJ) pipeline project.
• We expect the company to have strong distribution volume growth, primarily from the gas sales contract with PLN.

Danareksa Jasa Marga

Definitely more certainty
The government has signaled that it has the resolve to settle land acquisition problems related to the development of new toll roads. In this regard it has issued two regulations. The first deals with revolving funds for land acquisition and the second covers “land capping” in regard to land prices. The good news is that we now have strong evidence that these regulations are actually working (as evident in the development of two of Jasa Marga’s projects). As such, there is much greater certainty in regard to investment returns. Going forward this should increase investor appetite for toll road construction.

New interchange drives growth
Jasa Marga currently operates 11 toll road sections. Traffic on nine of them has reached the “maturity stage”, while traffic on the two relatively newer sections (Cipularang and JORR) has greater room to grow. Nonetheless, traffic on the Jakarta Cikampek section grew by 12.3% yoy in FY08, or much faster than the total growth of 2.2%. This was thanks to the new interchange at Cikunir (in the area of Bekasi). Likewise, we also expect traffic on the Jakarta Tagerang section to see a boost when JORR North W2 is completed in 2Q10. More integration will generate more traffic.

“Six plus one” projects in the pipeline
Jasa Marga has “six plus one” projects in the pipeline. Three sections are part of the Java Toll road network, while the remaining sections are part of the Greater Jakarta toll road network. At the same time, Jasa Marga is also looking to acquire the Surabaya-Mojokerto section with a minimum stake of 55%. Its partner would be Wijaya Karya with maximum ownership of 20%. Total capex is estimated to reach Rp3.3tr in FY09, comprising of routine and periodic expenditure, capacity expansion and new toll road development.

Changes to our forecast
With the updates provided by Jasa Marga, we have altered our scenarios for the three new toll roads (the Bogor Ring road, Gempol Pasuruan, and the Semarang Solo project), and we have shifted back our expected commencement dates for the commercial operation of these toll roads due to delays in land acquisition. Despite full support from the government, land acquisition is still time consuming. To be on the conservative side, we do not include the other three new toll roads into our forecast. As a result of our forecast changes, our core income estimate for FY09 is 4.4% higher due to higher interest income although core profits are 15.4% lower in FY10 due to the delays in the commercial operation of the toll roads.

Reiterate BUY
Although we retain our BUY recommendation on the counter, our target price is cut to Rp1,540 as the expected commencement dates for the commercial operation of the new toll roads are put back due to land acquisition delays. However, full support from the government in regard to the land acquisition has nonetheless reduced the investment risk. Jasa Marga has benefited from revolving funds and land capping – an encouraging sign for the industry.

Mandiri Sekuritas Economy

Jan09 CPI figure: Another round of deflation?
On Monday (2/1), the statistical bureau will announce Jan09 inflation
figure, which we estimate to be a deflation of 0.23% mom, bringing annual
inflation to a single digit of 8.96%.
Relatively stable food prices, coupled with more aggressive administered
price cut, in January will likely result in a monthly deflation in January,
which historically posted above 1% monthly inflation.
Declining inflation outlook and weaken domestic demand would
encourage BI to further cut benchmark rate in the next governor board
meeting (2/4). BI may continue to cut the rate by 50bps to 8.25% in
order to jump start the economy. Currently we maintain our inflation
forecast at 6.8% yoy and BI rate at 8% by the end of 2009.
Moreover, BI may continue to narrow the SBI and BI rate spread in order
to intensify the monetary policy transmission. In Jan09, the SBI 1mo has
declined by more than 100bps vs. 50bps cut in the benchmark rate.


Dec-09 MS Forecast Market Consensus
Headline Inflation (% yoy) 11.06 8.96 9.7
Headline Inflation (% mom) -0.04 -0.23 -
Headline Inflation (% ytd) 11.06 -0.23 -
Core Inflation (% yoy) 8.29 - -



Government secured external financing to back budget deficit.

We had a meeting with Anggito Abimanyu, Head of Fiscal Policy, Ministry of
Finance yesterday. Some takeaways from the meeting as follows:

To stimulate the economy in 2009 and to response to changes macroeconomic fundamentals, the government plan to
increase budget deficit to 2.5% of GDP (US$12bn) from 1% of GDP (US$5.5bn).
The fiscal stimulus planned to reached Rp71.3tn (1.4% of GDP), of which Rp43tn in the form of tax saving and
Rp10.2tn of cash injection to the economy.
Government has secured additional stand by loan from multilateral and bilateral of US$5.5bn, besides 2008 budget
financing surplus of US$5bn to finance the additional budget deficit. Government bond issuance is set to be unchanged
at US$5bn.
But the caveat remains on the ability of the government, both local and central government to spend the budget early
and parliament decision to approve the proposed budget.