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Moody’s Investors Service has affirmed the Government of Indonesia’s Baa3 issuer rating with a stable outlook. The key drivers are 1) Indonesia will maintain its strong balance sheet against the current backdrop of widening fiscal deficits and 2) policymakers will continue to effectively manage the risks from lower commodity prices and weaker growth to ensure.

Indonesia corporate bonds yield tightened sharply on last week trading with the yields fell in all maturities curve supported by a relief rally of IDR which strengthened 8.4% WOW to IDR 13,412 per US dollar. Credit yield fell in all tenor bonds and rating classes by an average of 65 bps WoW. Flows also rose.

With the economy growing >5% annually and its people increasingly connected via social media (evidenced in 2014’s presidential election), we see a new generation of confident and informed consumers on the rise. Vibrant, younger Indonesians in the sizeable middle class want to satisfy their secondary needs. They are optimists, entrepreneurial, technology-dependent and express their opinions.

We initiate coverage on Spindo with a DCF-derived TP of IDR370 which represents a 100% potential return upside and recommend a BUY. Our TP implies a 7.0x FY15F earnings. Main triggers: i) its dominance in the domestic steel pipe market with a 30% share; ii) the company being a beneficiary of the nation’s growing gas.

While we are still cautious on Indonesia’s short-term equity market outlook owing to economic and political uncertainties, we are of the view that its long-term fundamentals are intact. We foresee 2014 GDP growth dipping to 5.4% while Bank Indonesia (BI) may have to raise the BI rate to 7.75-8.25%. As short-term macroeconomic fundamentals are weak,.

Driven by sanguine investor sentiments, the market cap of the Indonesian construction sector has expanded by 280% since 2012, outpacing its EPS growth potential of 18%-22% for 2013F. We propose a bellwether report to consider amid potentially weaker sentiments, while we continue to have a positive outlook on construction companies. At present, defensive stock picks.

We are re-initiating coverage on the construction sector with an OVERWEIGHT for the following reasons: i) valuations are reasonable compared to regional players, ii) the government’s infrastructure projects are expected to accelerate earnings growth, iii) there are lower risks in executing projects, as laws will be enforced, iv) the property market’s outlook is solid for.

We are re-initiating coverage on the construction sector with an OVERWEIGHT for the following reasons: i) valuations are reasonable compared to regional players, ii) the government’s infrastructure projects are expected to accelerate earnings growth, iii) there are lower risks in executing projects, as laws will be enforced, iv) the property market’s outlook is solid for.

We initiate coverage on Selamat Sempurna (SMSM) with a BUY recommendation, based on: i) its high dividend yield; ii) high profitability; and iii) stable revenue growth prospects. We expect ROE to improve to 36.3% in 2013 from 29.6% in 2010, fuelled by higher utilization, and the stock’s dividend yield to jump to 10.7% from 7.1%..

Two fertilizer producers listed on the Indonesia Stock Exchange (IDX) managed to record good performances throughout the first semester of 2021. The revenue and net profit of PT Saraswanti Anugerah Makmur Tbk (SAMF) and PT Nusa Palapa Gemilang Tbk (NPGF) rose.