Kim Eng Indonesia Equity Daily, 14 Apr 09

Our Comment -by Katarina Setiawan

Bisnis Indonesia daily reported that Bakrie Sumatera Plantations has revised six accounts in its FY08 financial statements. Management claims the revision is due to some reclassifications and typos made by the company auditor. Biggest revisions are found in cash flow statements items. On income statements, the company omitted loss on written off plantation Rp1.5b in FY07. It seems that there is no impact on FY08 net profit.

We maintain SELL recommendation on the counter, mostly due to weak performance in FY08. Bakrie Sumatera is the weakest in the industry due to its high leverage and relatively high young age plantation portion resulting from acquisitions in the recent years..

Ramayana reported a 9.3% YoY sales decline in March. It seems that the layoffs (on domestic and migrant workers) and the declining commodity price have taken a toll on sales
The market rallied yesterday, supported by positive sentiment from the legislative election result. Rupiah also appreciated. Despite the recent rallies some stocks are still attractively valued.. Our picks include Bukit Asam, Gudang Garam, Indocement, Indofood, Indosat, Unilever, Wijaya Karya.

The US and regional markets were slightly down this morning after a strong rally yesterday.

Highlights

o Kalbe Farma (HOLD): To pay debt using internal cash

o Bakrie Sumatera (SELL): Revising FY08 financial statements

o Ramayana (UNDER REVIEW): Mar-09 sales down 9.3%

o CP Prima: Bapepam maintains quorum requirement From our chartist desk

o IDX: We see a high possibility of profit taking. But it will be only temporary, as we see a break in the IDX trend line and continuing appreciation of Rupiah (target is Rp10300/USD, from Rp11000/USD) . Today´s trading range is between 1384-1451-1495 (support) and 1562-1585-1651 (resistance) .

o BBCA: Middle line of Bollinger band, MA 12, MA 14 days are still intact in its upward momentum. We maintain target Rp3500. TRADING BUY

o TINS: Strong volume, supported by a reversal signal on stochastic. TRADING BUY