Lacking positive sentiment, investors are starting to watch the impact of demonstrations. Yesterday, the movement of the bond market was influenced by the domestic situation. A number of people reject the Omnibus Law on Job Creation (Ciptaker). Rupiah opened up 0.14% to IDR 14,670 / USD, which then fell 0.11% to IDR 14,706 / USD, before finally closing slightly higher by 0.03% at IDR 14,685 / USD. Meanwhile, most Government Securities (SBN) prices closed lower, except for 1-year and 20-year tenors, which were busy for investor transactions. 1-year SBN yields slumped 4.6 bps and 20-year yields fell 0.1 bps. On the other hand, the yield on 10-year SBN increased by 0.3 bps. The rejection which has lasted for the last 2 days has resulted in demonstrations in a number of areas. This has made investors prefer to sell SBN. Domestic economic data has not been able to provide positive sentiment. Bank Indonesia (BI) released data on the Real Sales Index (IPR) as of August, which fell 9.2% YoY. This figure has indeed improved compared to July 2020 which also fell by 12.3% YoY but still showed a contraction.
Pefindo: AAA Rating Two ADMF Notes. The Indonesian Securities Rating Agency (Pefindo) assigned an AAA rating to two Adira Dinamika Multi Finance Tbk (ADMF) debt securities, namely Continuous Bond IV Phase I 2017 Series B and Sustainable Sukuk Mudharabah III Phase I Year 2017 Series B. For the record, Sustainable Bonds IV Phase I Year 2017 Series B Adira Finance worth IDR 893 billion and Continuous Sukuk Mudharabah III Phase I Year 2017 Series B reaches IDR 55 billion. Pefindo sees Adira Finance as having the readiness to pay off the two debt securities, supported by the company’s large cash and cash equivalents of IDR 5.9 trillion by the end of August 2020. ADMF also has installment receivables on financing receivables of around IDR 3.2 trillion per month. . Both bonds will mature on December 12, 2020. For information, during 1H20, Adira Finance obtained a net profit of IDR 597 billion, or down 37% YoY. This decline was triggered by hampered financing performance due to the Covid-19 pandemic. Based on the company’s financial statements, Adira Finance posted a 1% decrease in interest income to IDR 5.8 trillion, compared to the same period last year. Interest expense decreased 2% YoY to IDR 2.3 trillion in 1H20. (Investor Daily)
The government sold a total of IDR 229.68 trillion to Bank Indonesia for burden sharing. In four issuances, the government has sold government bonds (SUN) to Bank Indonesia (BI) through a private placement scheme. This total issuance reaches 57.77% of the total public goods financing needs, projected at IDR 397.56 trillion. On Tuesday (6/10), the government issued IDR 46.2 trillion SUN purchased by BI. The government issued four series of SUN with the variable rate type, aka floating interest, which can be traded. Each series offers a 3-month BI reverse repo interest rate with a coupon for the first three months of 3.84% each. The four series of bonds have a value of IDR 11.55 trillion. The four SUN series are VR0046 (due 12 October 2025), VR0047 (due 12 October 2026), VR0048 (due 12 October 2027), and VR0049 (due 12 October 2028). The government first issued SUN through private placement to BI for the first burden sharing on August 6. In the second stage, the government only issued IDR 16.98 trillion and in the third stage IDR 84.4 trillion of SUN through a private placement to BI. (Kontan)
Investors Can Start Paying Attention to Long Tenors of PBS025 and PBS028. In the previous sukuk auction, the incoming bids for PBS025 and PBS028 were the highest. Based on data from the DJPPR, PBS025 recorded an incoming bid of IDR 6.72 trillion with a weighted average yield of 7.12% and a return of 8.37%. Meanwhile, PBS028 received a total incoming bid of IDR 6.44 trillion with a weighted average yield which was won by 7.49% and a reward of 7.75%. For the record, this Sukuk auction started the first SBSN auction for the 4Q20 period.