BNGA
Contact our analyst Achmadi
11% upside. Hold.
12th September 2022
Price Rp 1135
Target price Rp1,260
Stagnant Net Interest Income
In 1H22, BNGA’s Net Interest Income was stagnant. There was no growth from 1H21, which was at IDR 3.54 trillion. But net profit grew +18.85% yoy, from IDR 2.13 trillion in 1H21 to IDR 2.53 in 1H22. The net profit growth was driven by Non-Interest Income which grew +22.32% from IDR 2.49 trillion in 1H21 to 3.05 trillion in 1H22. We estimate that BNGA’s net profit will increase +12.73% in FY22, to IDR 4.62 trillion from IDR 4.10 trillion in FY21.
Strong Loan and Deposit growth
Total Gross Loans grew +9.43% from IDR 173.35 trillion in 1H21 to IDR 189.70 trillion in 1H22, supported by Corporate loans, which grew +16.43%. Other loans, Consumer and EBB grew too. Those segments grew +13.83 and +7.31% respectively. In contrast to other loans, commercial credits declined -9.08% due a change of focus towards SME loans which offer higher risk-adjusted returns. Total Customer Deposits grew +6.38% yoy from IDR 218.07 trillion to IDR 231.99 trillion. The deposit growth was driven by Current Accounts, which grew +16.90% yoy, and led to a CASA ratio improvement of 335 bps to 65.72%. We forecast Total Gross Loans and Customer Deposits will grow by +9.03% and +8.83 respectively.
Higher NPL ratio
Although still within OJK’s requirement, BNGA’s NPL ratio was worse compared to 1H21. It increased 30 bps to 3.50% this semester . The COVID-19 restrictions are still one of the major factors, especially for the hospitality industry. We assume that BNGA’s will improve its NPL ratio to 3.41% in FY22.
Valuation: 11% Upside, HOLD.
Based on our DDM Valuation, we have a target price within one year of IDR 1,260 or trading at 0.7x PBV which gives 11% potential upside, Hold.
In 1H22, BNGA’s Net Interest Income was stagnant. There was no growth from 1H21, which was at IDR 3.54 trillion. But net profit grew +18.85% yoy, from IDR 2.13 trillion in 1H21 to IDR 2.53 in 1H22. The net profit growth was driven by Non-Interest Income which grew +22.32% from IDR 2.49 trillion in 1H21 to 3.05 trillion in 1H22. We estimate that BNGA’s net profit will increase +12.73% in FY22, to IDR 4.62 trillion from IDR 4.10 trillion in FY21.
Strong Loan and Deposit growth
Total Gross Loans grew +9.43% from IDR 173.35 trillion in 1H21 to IDR 189.70 trillion in 1H22, supported by Corporate loans, which grew +16.43%. Other loans, Consumer and EBB grew too. Those segments grew +13.83 and +7.31% respectively. In contrast to other loans, commercial credits declined -9.08% due a change of focus towards SME loans which offer higher risk-adjusted returns. Total Customer Deposits grew +6.38% yoy from IDR 218.07 trillion to IDR 231.99 trillion. The deposit growth was driven by Current Accounts, which grew +16.90% yoy, and led to a CASA ratio improvement of 335 bps to 65.72%. We forecast Total Gross Loans and Customer Deposits will grow by +9.03% and +8.83 respectively.
Higher NPL ratio
Although still within OJK’s requirement, BNGA’s NPL ratio was worse compared to 1H21. It increased 30 bps to 3.50% this semester . The COVID-19 restrictions are still one of the major factors, especially for the hospitality industry. We assume that BNGA’s will improve its NPL ratio to 3.41% in FY22.
Valuation: 11% Upside, HOLD.
Based on our DDM Valuation, we have a target price within one year of IDR 1,260 or trading at 0.7x PBV which gives 11% potential upside, Hold.
Previously