Company Update Bank BRI Bloomberg: BBRI:IJ Reuters: BBRI.JK Samuel Research 09 Februari 2017 Target Price Rp 13,500 Last Price Rp 12,000 Potential Upside 12.5% JCI Index 5,322 Share Issued (mn) 24,669 Market Cap. (Rp bn) 296,030 52-Weeks High/Low 12,975/9,525 Avg Daily Vol (mn) 21.1 Free Float 43.25% Nominal Value Rp 250 Book value/share 16 Rp 5,935 Relative to JCI Chart BUY (Maintain) 20% 10% 0% -10% Dec-14 May-15 Oct-15 Mar-16 Aug-16 Jan- -20% -30% -40% BBRI JCI Company Background PT Bank Rakyat Indonesia Tbk didirikan pada tahun 1968 dan melantai di bursa efek pada 2003. Bank ini terus berkembang dan saat ini merupakan salah satu bank terbesar di Indonesia. Shareholder Structure Govt of Indonesia 56.8% Public 43.3% Andy Ferdinand, CFA +62 21 2854 8148 andy.ferdinand@samuel.co.id Growing Softly Pertumbuhan kredit di tahun ini diperkirakan masih di atas industri terutama ditopang oleh segmen mikro dan BUMN, sementara pendapatan komisi masih akan tumbuh relatif kuat. Namun masalah kualitas aset masih perlu diwaspadai. Tetap Buy dengan TP sedikit turun menjadi Rp 13.500 (2,0x PBV 2017F). Tetap waspadai NPL. Meski NPL (bank only) tampak membaik di 2H16 (4Q16: 2,03%, 2Q16: 2,31%, 4Q15: 2,02%), kami masih menyimpan kekhawatiran mengenai kualitas aset bank ini di tahun ini karena sejumlah hal: 1.) Manajemen BRI memperkirakan NPL sebesar 2,2-2,4% di tahun ini, lebih tinggi dari 2,03% di 4Q16 (bank only) atau 2,13% di 4Q16 (konsolidasi); 2.) NPL segmen korporasi non SoE dan medium yang tinggi dan cenderung meningkat bahkan di 4Q16, dapat berlanjut di tahun ini dan ada kemungkinan writeoff; 3.) Coverage ratio direncanakan tidak jauh berbeda dari tahun 2016 (4Q16: 170%, rencana 2017: 160-170%), mengindikasikan kemungkinan penurunan biaya provisi secara yoy yang tidak begitu besar, atau mungkin malah akan naik. Perlu diingat bahwa Direktur Utama BRI akan segera mengakhiri masa jabatannya di 1Q17 dan saat ini calon penggantinya sedang diseleksi. Ada kemungkinan perubahan pemimpin akan membawa perubahan juga pada kebijakan dan program seputar kualitas aset. Segmen mikro dan korporasi SoE masih kuat. Setelah membukukan kenaikan kredit 14,2% di 2016, kami memperkirakan kredit tumbuh 14% di tahun ini dengan segmen mikro dan korporasi non SOE masih sebagai penopang utamanya. KUR masih akan memegang peranan penting di segmen mikro meski ada perubahan skema dari pemerintah. Sementara itu, berjalannya proyek infrastruktur merupakan kunci bagi berlanjutnya permintaan kredit infrastruktur ke BUMN. Seiring dengan potensi peningkatan inflasi dan suku bunga, kami memperkirakan NIM akan sedikit turun (sekitar 30bps yoy) di tahun ini. Pendapatan komisi turut menopang kinerja. Fee-based income yang ratarata (CAGR) tumbuh 23,9% per tahun diperkirakan masih akan bertumbuh relatif kuat di tahun ini dengan proporsi pendapatan komisi ke total pendapatan perlahan meningkat (2015: 7,4%, 2016: 8,2%, 2017F: 9,0%). Maintain Buy with lower TP. Setelah sedikit merevisi ke bawah forecast kami sejalan dengan situasi terkini dan guidance manajemen, target price kami berdasarkan book value turun sedikit menjadi Rp 13.500 (2.0x PBV 2017F) dengan faktor resiko NPL dan biaya dana yang meningkat. Forecast and Valuation (at closing price Rp12,000 per share) Y/E Dec (Rp Bn) 15A 16A 17E 18E Net Interest Income 58,279 67,577 73,541 80,646 Pre Provision Profit 40,859 47,754 49,965 52,565 Net Profit 25,398 26,196 28,054 31,927 EPS (Rp) 1,030 1,062 1,137 1,294 DPS (Rp) 295 309 319 341 Dividend Yield (%) 2.5 2.6 2.7 2.8 BV per Share (Rp) 4,574 5,935 6,754 7,707 P/E Ratio (x) 11.7 11.3 10.6 9.3 P/BV Ratio (x) 2.6 2.0 1.8 1.6 www.samuel.co.id Page 1 of 5
Figure 1. FY16 Result (reported figures) Rpbn 4Q15 3Q16 4Q16 QoQ YoY FY15 FY16 YoY FY16F Achiev. Net Interest Income 15,416 17,074 17,519 2.6% 13.6% 58,280 67,576 16.0% 66,268 102.0% Operating Profit 10,567 7,449 11,740 57.6% 11.1% 31,960 33,966 6.3% 31,765 106.9% Pre Provision Profit 12,374 11,342 14,110 24.4% 14.0% 40,860 47,757 16.9% 44,102 108.3% Net Profit 6,981 6,775 7,245 6.9% 3.8% 25,398 26,196 3.1% 25,923 101.1% Bank Only: NIM 8.1% 8.3% 14 bps BOPO 68.0% 68.9% 97 bps LDR 86.9% 87.8% 89 bps Gross NPL 2.0% 2.0% 1 bps Figure 2. Loan (Bank only) Composition Rptn FY15 FY16 Growth Composition Micro 179 212 18.2% 33.3% Consumer 89 100 13.2% 15.8% Small Commercial 115 126 9.8% 19.8% Medium 20 21 4.0% 3.3% Corporate Non SoE 75 84 12.0% 13.2% SoE 81 93 14.3% 14.6% TOTAL 558 635 13.8% 100.0% Figure 3. Deposit (Bank only) Composition Rpbn FY15 FY16 Growth Composition Time Deposit 262 285 8.8% 39.4% Saving Account 268 298 11.2% 41.1% Current Account 113 141 24.6% 19.5% TOTAL 643 724 12.6% 100.0% www.samuel.co.id Page 2 of 5
Figure 4. Gross NPL (%) by Segment 10 8 6 4 2 0 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 Micro Consumer Small Comm. Medium Corp. Non SoE Overall Figure 5. Fee-Based Income (Rp tn) and Its Composition in FY16 10 8 6 4 2 0 4-yr CAGR: 23.9% 2012 2013 2014 2015 2016 9% 10% 13% 24% 44% Deposit Admin E-banking Loan Admin Intl. Business Others Figure 6. Rolling Forward PBV 3.5 3.0 2.5 2.0 1.5 1.0 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Average ST dev +1 ST dev -1 PBV- Forward ST dev +2 ST dev -2 Source: Bloomberg, SSI Research www.samuel.co.id Page 3 of 5
Key Financials Profit and Loss Key Ratio (our calculations may differ slightly from actual) (Rp bn) 15A 16A 17F 18F 15A 16A 17F 18F Net Interest Income 58,279 67,577 73,541 80,646 Profitability Operating Income 31,959 33,964 35,896 40,859 NIM 8.4% 8.7% 8.4% 8.2% Pre Provision Profit 40,859 47,754 49,965 52,565 ROAE 24.1% 20.2% 17.9% 17.9% Profit before Tax 32,494 33,973 35,905 40,869 ROAA 3.0% 2.8% 2.6% 2.6% Net Profit 25,398 26,196 28,054 31,927 CIR 43.4% 43.7% 46.4% 48.8% BOPO 67.8% 69.7% 70.9% 70.0% Liquidity Balance Sheet LDR 86.9% 87.6% 87.7% 87.7% Yr-end Dec (Rp bn) 15A 16A 17F 18E CASA Ratio 57.8% 59.1% 59.7% 60.4% Cash 28,772 25,212 24,279 20,675 CA and Placement 120,289 144,802 161,381 179,919 Asset Quality Marketable Securities 124,873 131,482 151,194 173,879 Gross NPL 2.0% 2.0% 2.2% 2.2% Gross Loan 564,480 643,471 733,557 836,255 NPL Coverage 151% 170% 170% 170% Loan Provision (17,162) (22,184) (27,929) (31,182) Recap Govt Bonds 3,816 3,318 3,152 2,994 Capital Other Assets 53,358 77,543 86,918 97,409 CAR 20.6% 22.8% 21.2% 22.6% Total Assets 878,426 1,003,644 1,132,553 1,279,950 Deposits 668,995 754,525 858,442 976,836 Growth Rate Current Account 114,367 142,547 163,929 188,518 Gross Loan 14.0% 14.0% 14.0% 14.0% Saving Account 272,471 303,269 348,759 401,073 Deposits 7.5% 12.8% 13.8% 13.8% Time Deposit 282,157 308,709 345,754 387,245 Net Interest Income 13.3% 16.0% 8.8% 9.7% Deposits from Other Ban 11,165 2,229 2,340 2,457 Operating Income 12.9% 6.3% 5.7% 13.8% Borrowings 35,480 35,008 36,758 38,596 Net Profit 4.9% 3.1% 7.1% 13.8% Securities Issued 10,521 24,800 23,560 22,382 Other Liabilities 39,138 40,270 44,424 49,119 Macro Total Liabilities 765,299 856,832 965,525 1,089,391 GDP Growth 4.7% 5.1% 5.2% 5.4% Minority Interest 294 391 411 431 BI RR Rate 4.8% 4.8% 5.3% Total Equity 112,834 146,422 166,617 190,128 USD/IDR, average 13,500 13,253 13,200 12,800 www.samuel.co.id Page 4 of 5
Research Team Andy Ferdinand, CFA Head Of Equity Research, Strategy, Banking, Consumer andy.ferdinand@samuel.co.id +6221 2854 8148 Rangga Cipta Economist rangga.cipta@samuel.co.id +6221 2854 8396 Muhamad Makky Dandytra, CFTe Technical Analyst makky.dandytra@samuel.co.id +6221 2854 8382 Akhmad Nurcahyadi, CSA Auto, Aviation, Cigarette, Construction Healthcare, Heavy Equipment, Property akhmad.nurcahyadi@samuel.co.id +6221 2854 8144 Arandi Ariantara Cement, Telecommunication, Utility arandi.ariantara@samuel.co.id +6221 2854 8392 Marlene Tanumihardja Poultry, Retail, Small Caps marlene@samuel.co.id +6221 2854 8387 Sharlita Lutfiah Malik Mining, Plantation sharlita.malik@samuel.co.id +6221 2854 8339 Adde Chandra Kurniawan Research Associate adde.kurniawan@samuel.co.id +6221 2854 8338 Private Wealth Management Evelyn Satyono Head of PWM / Institutional Sales evelyn.satyono@samuel.co.id +6221 2854 8380 Muhamad Alfatih CSA, CTA, CFTe Senior Technical Portfolio Advisor m.alfatih@samuel.co.id +6221 2854 8129 Ronny Ardianto Institutional Equity Sales ronny.ardianto@samuel.co.id +6221 2854 8399 Clarice Wijana Institutional Equity Sales clarice.wijana@samuel.co.id +6221 2854 8395 Fachruly Fiater Institutional Equity Sales fachruly.fiater@samuel.co.id +6221 2854 8325 Equity Sales Team Kelvin Long Head of Equities kelvin.long@samuel.co.id +6221 2854 8150 Yulianah Institutional Equity Sales yulianah@samuel.co.id +6221 2854 8146 Lucia Irawati Retail Equity Sales lucia.irawati@samuel.co.id +6221 2854 8173 Online Trading Sales Team Nugroho Nuswantoro Head of Marketing Online Trading nugroho.nuswantoro@samuel.co.id +6221 2854 8372 Wahyu Widodo Marketing wahyu.widodo@samuel.co.id +6221 2854 8371 Aben Epapras Marketing aben.epapras@samuel.co.id +6221 2854 8389 DISCLAIMERS : Analyst Certification : The views expressed in this research accurately reflect the personal views of the analyst(s) about the subject securities or issuers and no part of the compensation of the analyst(s) was, is, or will be directly or indirectly related to the inclusion of specific recommendations or views in this research. The analyst(s) principally responsible for the preparation of this research has taken reasonable care to achieve and maintain independence and objectivity in making any recommendations. This document is for information only and for the use of the recipient. It is not to be reproduced or copied or made available to others. Under no circumstances is it to be considered as an offer to sell or solicitation to buy any security. Any recommendation contained in this report may not be suitable for all investors. Moreover, although the information contained herein has been obtained from sources believed to be reliable, its accuracy, completeness and reliability cannot be guaranteed. All rights reserved by PT Samuel Sekuritas Indonesia www.samuel.co.id Page 5 of 5