Our Comment\r\n\r\nBank of Indonesia indicated that inflation may swell over 9% if the government increases the fuel price by 30% in June. The Central Statistic Agency (BPS) says inflation will remain high in the next three months. \r\n\r\nAccording to Koran Tempo daily, Investigative panel from Indonesia’s Business Competition Supervisory Commission (KPPU) recommends a guilty verdict against all incumbent telco operators in allegation of SMS fixed-pricing. The commission will review the recommendation in 30 working days, providing opportunities for the operators to defend them shelf. \r\n\r\nRegional markets are slightly down this morning, after the US market fell sharply.\r\n\r\nRicardo Silaen\r\n\r\n \r\n\r\n \r\n\r\nHighlights\r\n\r\n• Semen Gresik (BUY): Analyst meeting\r\n\r\n• Ramayana (BUY): Sales increase 20.6% Y/Y in Apr-08\r\n\r\n• Truba Alam (BUY): To issue dollar bonds for IPP projects\r\n\r\n• Telkom (HOLD): To seek US$500m loan for acquisition\r\n\r\n• Astra International: Propose to distribute Rp484 final DPS for FY07 \r\n\r\n• Mitra Rajasa: Obtaining loan to acquire Apexindo\r\n\r\n• Bank Mega: Q108 result\r\n\r\nFrom our chartist desk\r\n\r\n• JCI: Dow Jones index corrected deeply -1,5% this morning. JCI: Indonesia stock market is signaling daily TD sequential buy set up 5th days. Upper line as our strong resistance level 2443, providing good opportunity. Our strategy is buy on weakness at near support. Today’s trading range is between 2337-2358-2370 (supports) and 2391-2401-2422 (resistances) \r\n\r\n• BUMI: The share price broke of trend line channel yesterday with big volume. It is supported by moving average histogram. Target price is Rp7600. BUY \r\n\r\n• ANTM: Positive cross over of moving average histogram. Trend line indicates target of Rp4100. BUY.
Our Comment\r\n\r\nArcelorMittal has officially submitted a letter stating its interest to acquire 49% stake in the state-owned Krakatau Steel (KS) and may spend up to US$10b for investment in Indonesia. At present, Tata Steel from India and BlueScope Steel from India are also keen to acquire KS.\r\n\r\nYesterday, Microsoft founder Bill Gates met the President and expressed his commitment to support the government’s efforts to improve education quality by providing Internet-based national education. The visit also highlights the progress that Indonesia makes to fight the software piracy. \r\n\r\nAnticipation of fuel hike in June induces some people to pile-up the fuel and causing scarcity in a number of cities throughout Indonesia. The government expects to introduce smart card by September to control fuel consumption. \r\n\r\nRicardo Silaen\r\n\r\n \r\n\r\n \r\n\r\nHighlights\r\n\r\n• Semen Gresik (BUY): Dividend schedule\r\n\r\n• CP Prima: Net profit grew 66% Y/Y to Rp100b in Q108\r\n\r\n• Media Citra Nusantara: Q108 net profit up 28% Y/Y\r\n\r\n• Elnusa: Won project of US$49m\r\n\r\n• Mitra Rajasa: Progress on acquisition plan on Medco\r\n\r\n• IPO: Indika Energy (update)\r\n\r\n• IPO: Bumi Serpong Damai (update)\r\n\r\nFrom our chartist desk\r\n\r\n• JCI: Dow Jones slightly moved up +0,4% this morning. Indonesia stock market has limited upside with daily TD sequential buy set up 6th days. On the other side; yen/dollar currency 103,7 is still showing weakening trend, brings positive impact to JCI in the mid-term. Our strategy is buy on weakness. Today’s trading range is between 2304-2335-2356 (supports) and 2387-2397-2428 (resistances) \r\n\r\n• ANTM: Moving average 12-26 days histogram is still in positive territory right now. The share price broke up trend line, target is Rp4100. BUY \r\n\r\n• DEWA-W: Long white candle with strong of buying volume. Good choice, with trend line indicate target of Rp310. BUY.