Kim Eng Indonesia Equity Daily, 23 Feb 09

Our Comment During a meeting of finance ministers in Phuket (Thailand), Japan, China, South Korea and 10 south east Asian nations (ASEAN +3) agreed to pool US$120b funds to prevent extreme currency depreciation and strengthen net reserve.


The above amount is 50% higher than that agreed on Chiang Mai Initiative in May 2008. The funds can be withdrawn by member countries through currency swap mechanism. Details will be further discussed in Bali in May 2009. Around 80% of the pooled funds is contributed by China , the remaining 20% is generated by other members. For Indonesia , available funds will be US$13.7b, up from US$8b previously. The above is positive for Indonesia and the region as it provides additional funds to prevent currency shock like the one in 1997-98 Asian crisis. Inco Reported lower-than expected net profit in 4Q08 on lower nickel prices and high energy prices. It booked net loss of US$9.8m in 4Q08 vs. net profit of US$200m in 4Q07. The net profit was well below our expectation, as well as market consensus, mainly due to lower nickel prices and high energy prices. Meanwhile, sales were in line with our estimates. The company recorded loss (other expenses) of US$18m in 4Q08. We reckon that aside from that loss, operationally Inco was still profitable in 4Q08. We reiterate our SELL recommendation on Inco. Our TP is Rp1,100. Bumi Resources Is considering holding an EGM to seek shareholders approval on acquisitions of 3 companies: Darma Henwa, Fajar Bumi Sakti, and Pendopo Energi Batubara. Previously, Chairman of Bapepam indicated that the transactions bear conflict of interests. The capital market regulatory body also plans to appoint a new appraiser to value the transactions. (by Katarina Setiawan)


Highlights
o Inco (SELL): Posted net loss of US$9.8m in 4Q08
o Bumi Resources: To hold EGM
o Truba Alam: Aims to book Rp2.5-2.7t revenue
o Bank Permata: FY08 results From our chartist desk

o IDX: Regional markets are in negative territory, in line with weakening Rupiah. Low target on IDX chart are 1230 and 1247, referring to Fibonacci retracement level 61,8% and 50%. But, Bollinger band 20 day in oversold zone. Today´s trading range is between 1230-1247-1270 (support) and 1314-1332-1361 (resistance) .

o UNVR: Minor correction will be healthy, with strong support level Rp7900, according to gap candlestick. BUY ON WEAKNESS


o LTLS: Daily TD sequential buy set up 6th day with strong buying volume. We set target price at Rp750. TRADING BUY