JP Morgan - ASII: Auto momentum strong, rotation beneficiary

ASII’s 1Q net profit of Rp 3.0 trn, was broadly in line with our 1QFY10 forecast of 3.2 trn. At an EPS run rate of Rp 754, we see these results as being ahead of the street (consensus FY10E EPS of Rp 2,890), and expect the trend of upward earnings revisions to continue, and our forecasts are about 11% higher than the street.

JP Morgan - UNTR: Earnings momentum waning

After continuously beating expectations for the last 4 quarters, we see UNTR’s 1Q headline profits as slightly underwhelming. Net profits (after stripping out Rp 42 bn in post tax non-recurring income that we had factored in) of Rp 866 bn were up 7% y/y and flat q/q despite stronger sales volumes, and came in about 14% lower than our forecasts.

JP Morgan - PTBA: Weak Results

The company reported 1Q10 net income of Rp373B; down 59.5% Y/Y and down 25.3% Q/Q. With historically, 1Q has contributed to an average of 26.0% to full year profit, PTBA’s 1Q10 result came in lower than both JPM (14.7%) and consensus’ (13.8%) full year forecast of Rp2.535 trillion and Rp2.707 trillion respectively.

JP Morgan - BBCA: Weak Results

At the PPOP level, 1Q profit was about 6% lower than our estimate. Based on comparable data provided by management, PPOP declined by 23% y/y. Management also indicated that G&A expenses rose by 25% y/y, although largely due to branch and ATM network expansion. Credit quality deteriorated by 20bp but remained well contained at 0.9%; coverage stood at 327%.

JP Morgan - Mayora (MYOR) Small Cap search continues

This company has shown an impressive quarterly trend up to 4Q09. Over the last 8 quarters, turnover has grown by about 5% per quarter (turnover 42% higher in eight quarters). Gross profit margin has been expanding by 70 basis points per quarter. As a result, quarterly net income has multipled by 2.5x between 1Q08 and 4Q09. Profit run rate is now around Rp100bn per quarter, and the Street forecast of Rp390bn for the full year 2010 is looking conservative (implied P/E of 9.5x), given JPMorgan’s bullishness on IDR currency and further reductions in corporate tax rate. The management remains upbeat about surprising the Street further with 1Q10 profits, believing that growth opportunity for MYOR remains abundant. The company will be spending around US$40mn per year (10% of current market cap) on capex. Mayora’s total turnover has grown by 12x over the past 12 years, with no signs of market saturation. MYOR could be one of the best long term play on potentially rising purchasing power for the Indonesians, as the population drinks more instant coffees and eats more candies and biscuits.