BMRI
Contact our analyst achmadi
19% UPSIDE, Buy
11th August, 2022
Price Rp8,600
Target price Rp10,250
61.66% Profit Growth
As of 1H22, BMRI recorded a Net Profit of IDR 20.21 trillion, up 61.66% YoY from IDR 12.50 trillion in 1H21. Growth was supported by higher Net Interest Income +18.99% YoY and well managed operating expenses +3.91%. BMRI's positive performance was also driven by digitalization through Livin' by Mandiri so that the CASA ratio increased from 67.46% in 1H21 to 70.75% in 1H22. We estimate BMRI will grow Net Profit +39.63% from IDR 28.03 trillion to IDR 39.14 trillion in 2022.
Strong Loan growth
BMRI recorded strong loan growth of +10.67% YoY in the first semester of 2022. The growth was driven by SME Loans, which grew 12.48% YoY. Other segments increased too. Micro, Corporate, Commercial, and Consumer grew +12.03%, +10.59%, +9.90% and +9.30% respectively. We predict Total Gross Loans (bank only) will grow +11.85% in 2022 with Corporate Loans growing the fastest at 15.14% compared to last year.
Asset Quality Improved
BMRI improved its asset quality with the gross NPL ratio declining from 3.21% in 1H21 to 2.44% in 1H22. Of the five segments that are served by BMRI, only one, Corporate lending had a NPL ratio increase from 0.39% last year to 1.04%. Micro loans had the largest improvements with the NPL ratio declining from 2.82% to 1.25%. The NPL ratios from SME, Consumer, and Commercial loans were 0,96%, 1.91% and 7.36% respectively. The asset quality improvement was also seen by a decrease in the Consolidated Restructured Loans Ratio which declined from 19.22% to 13.21%. We forecast BMRI’s gross NPL will decline again to 2.39%.
Valuation: 19% Upside, Buy.
Based on our DDM Valuation, we have a target price within one year of IDR 10,250 or trading at 2,0x PBV which gives 19% potential upside, Buy
As of 1H22, BMRI recorded a Net Profit of IDR 20.21 trillion, up 61.66% YoY from IDR 12.50 trillion in 1H21. Growth was supported by higher Net Interest Income +18.99% YoY and well managed operating expenses +3.91%. BMRI's positive performance was also driven by digitalization through Livin' by Mandiri so that the CASA ratio increased from 67.46% in 1H21 to 70.75% in 1H22. We estimate BMRI will grow Net Profit +39.63% from IDR 28.03 trillion to IDR 39.14 trillion in 2022.
Strong Loan growth
BMRI recorded strong loan growth of +10.67% YoY in the first semester of 2022. The growth was driven by SME Loans, which grew 12.48% YoY. Other segments increased too. Micro, Corporate, Commercial, and Consumer grew +12.03%, +10.59%, +9.90% and +9.30% respectively. We predict Total Gross Loans (bank only) will grow +11.85% in 2022 with Corporate Loans growing the fastest at 15.14% compared to last year.
Asset Quality Improved
BMRI improved its asset quality with the gross NPL ratio declining from 3.21% in 1H21 to 2.44% in 1H22. Of the five segments that are served by BMRI, only one, Corporate lending had a NPL ratio increase from 0.39% last year to 1.04%. Micro loans had the largest improvements with the NPL ratio declining from 2.82% to 1.25%. The NPL ratios from SME, Consumer, and Commercial loans were 0,96%, 1.91% and 7.36% respectively. The asset quality improvement was also seen by a decrease in the Consolidated Restructured Loans Ratio which declined from 19.22% to 13.21%. We forecast BMRI’s gross NPL will decline again to 2.39%.
Valuation: 19% Upside, Buy.
Based on our DDM Valuation, we have a target price within one year of IDR 10,250 or trading at 2,0x PBV which gives 19% potential upside, Buy
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