Morning Brief

16 May 2012,

Our best trading ideas for today 16 May 2012 SMGR Add LT Sideways di 10.350-11.650 16 May 2012 INDF Add LT trading range di 4.500-5.150 16 May 2012 ITMG Add LT Trading range di 34.400-45.000 16 May 2012 BBNI Red ST trading range di 3.850-4.075 16 May 2012 BBRI Red Breakdown support kunci 6.400	Latest Company Report 14 May 2012 RANC SBL: Redefining Supermarket Experience - - 30 Nov 2011 ASRI The Right Time for New Projects BUY TP Rp550 24 Nov 2011 UNTR October Operational Outlook BUY TP Rp30,000 18 Nov 2011 BUMI Takeaway from Bumi Plc Note NR Under Review 17 Nov 2011 UNVR Adapting to Win BUY TP Rp17,400 [ More ]
Latest Sector Report  21 Oct 2011 Cement Still on Track OW 16 Sep 2011 Cement Cyclical Downturn Only OW 14 Jul 2011 Cement Buoyant on Volume, Cautious on Price OW 21 Jun 2011 Cement Growth Momentum OW 15 Jun 2011 Coal Mining Contract Renegotiation Brews OW [ More ]	Latest Technical Report  10 Jun 2011 TINS Potensi Rebound Menanti DN 19 Apr 2011 BMRI Tekanan di 2Q11, Siap Panen di 3Q11 RED 15 Mar 2011 Nymex Oil Closing the gap UW     [ More ]

Following a decrease in domestic consumption  (down to 25.0% from last year’s 30.0%), and a corresponding decline in the contribution of coal and mineral income to national revenues, Director of Coal Business, Ministry of Energy and Mineral Resources, Edi Prasojo has stated that a form of unfairness on the part of several contract holders appears to be the main reason for the delay in implementing  the export duty. Without dismissing a rumor that coal businessmen have made a significant push, he conveyed the notion that weighting a 20% extra export tax to PKP2B 1st Generation contract holders (contributing around 75% of the nation’s production) might bring the Ministry to file suit in Arbitrage Court; in the other hand, discrimination against IUPs and other PKP2B generations is against the constitution. Source: Investor Daily

AKR Corporindo (AKRA) director Suresth Vembu has stated that this year the company's target is for some 1.0m tons of production from its coal mining unit, with projected ASP of US$72.0-73.0 per ton. Currently the subsidiary holds 5 KPs, mostly located in Central Kalimantan, while another in East Kalimantan has started operation with estimated reserves of 12.0m tons. Meanwhile, the company has also finalized the acquisition of 26.0% of Jabal Nor, the owner of a coal hauling road and terminal operator in Tapin, East Kalimantan . With this acquisition, company will secure a majority stake of 59.4% Source: Bisnis Indonesia , The Jakarta Post

A total of Rp1.7tr has been prepared by Unilever Indonesia (UNVR) to fund its capex (capacity expansion and distribution network reinforcement); the Rp1.7tr fund is part of company’s investment fund for 2010-2012, at a value of EUR300.0-350.0m. Source: Investor Daily

The new US$450.0m loan will emerge from 2 sources, with US$250.0m funded by Bank Mandiri, BRI and BNI with 6 years' maturity, while the remainder will function as a standby loan. The blast furnace itself will be located in the Krakatau Steel (KRAS) industrial complex in Cilegon, at an estimated total cost of US$601.0m. Source: The Jakarta Post

In respect to the implementation of Ministry of Trade ruling No29/2012, starting Jun-Aug12 the Government will clamp a 25.0% cap on exports of raw ore, indexed to 2009-2010 figures; the limit will be equally distributed among exporters, in accordance with their 2009-2010 export weightings. Officials have stated that the export cap is aimed to dampen what they claim to be excessive exports, which have soared around 90.0% since 2010 – when the Law no.23/2010 restricting raw ore exports was enacted. Source: Investor Daily

For Apr12, the Indonesian auto industry recorded a jump of 43.4% YoY growth to 87,080 units, from 60,726 units in Apr11, apparently eating into motorcycle sales, which were beaten down 12.4% YOY, from 705,165 to 617,508 units. Astra still leads both car and motorcycle segments, with stable market shares of 58.3% and 55.7%, respectively. Indonesia’s vigorously growing economy and the emergence of a middle-income class is marked by a simple turn of preference in choice of transportation – much as took place in Post-WWII Europe . Source: Astra International, Kresna Research

The Indonesian Heavy Equipment Association has projected a need for some US$300.0m to be on tap for the industry, which is set to grow by 50.0% by 2015. Association Chief Hinabi Pratjojo Dewo opines that while demand will spurt by 5,000 units, domestic production will only cover around 60.0%, or some 25,000 additional units, with the remainder to be imported. He added that to boost production major investment in close-to-port Eastern Jakarta reassembling plants will be required. Source: Bisnis Indonesia