In the midst of waiting for the release of data on foreign exchange reserves that have the potential to rise. Yields on 10-year and 20-year government bonds were relatively flat at around 6.40% and 7.05% yesterday. NHKSI Research sees a potential increase in foreign exchange reserves (cadev), supported by the issuance of samurai bonds worth more than IDR 13 trillion. We also see the potential for an increase in cadev until the end of 2021, compared to the previous year of USD 135.9 billion. This potential increase in cadev is also amid expectations of US tapering in line with US economic recovery.
BFI Finance Distributes Dividends. BFI Finance Indonesia Tbk (BFIN) will distribute dividends of IDR 18 per share from profit in 2020. The dividends will be distributed to shareholders on June 8, 2021 and will be paid on June 25, 2021. Dividends distributed are IDR 269 billion or equivalent to 38, 3% of BFI Finance’s profit last year. With BFIN’s share price at IDR 735 per share, Thursday (27/5), BFI Finance’s dividend yield is 2.45%. BFI Finance earned IDR 4.57 trillion in revenue last year. This revenue is down 12.79% YoY. (Kontan)
Gold Mining Results Subject to VAT. The government plans to regulate mining products to be subject to value added tax (VAT), including pure gold. Previously, pure gold from mining was excluded from tax objects or included in Non-Taxable Goods (BKP). Because currently only gold jewelry is subject to VAT. However, gold bullion for the sake of state foreign exchange reserves is still excluded from non-BKP. The agenda is contained in the fifth amendment to Law (UU) Number 6 of 1983 concerning General Provisions and Tax Procedures (KUP). This regulation is planned to be discussed as soon as possible this year because it has been stipulated in the National Legislation Program (Prolegnas) by the parliament. (Kontan)
Investors Interested in FR0086 and FR0087. Market participants have the opportunity to return to interest in short and medium tenors in this SUN auction. In the previous auction, market participants responded positively to BI’s decision to keep the BI 7-DRRR low at 3.50%. As a result, the real yield spread between 10-year SUN and similar tenor UST remains at 500 bps, or higher than in the region. In more detail, the bid for the SUN auction last Tuesday (25/05) was valued at IDR 78 trillion. This high offer was supported by FR0086 and FR0087, which recorded incoming bids of up to IDR 28 trillion and IDR 26.2 trillion, respectively. At the end of last May, the government won IDR 32.5 trillion or slightly above the indicative target