Aldira Sunrise 13 September 2024

Economy: VAT increases to 12%, Indef estimates the economy will contract
Institute for Development of Economics and Finance (Indef) research found that if the VAT rate is increased to 12%, the economy will experience a contraction. Indef’s Executive Director, Esther Sri Astuti, said that the increase in VAT will cause nominal wages to decrease, meaning real income will also fall, inflation will contract, and the performance of exports and imports will decline. Based on Indef’s calculations, if the VAT rate increase scenario is 12.5%, then nominal wages will contract by 5.86%, CPI will contract by 0.84%, and GDP growth will contract by 0.11%. Meanwhile, public consumption will contract by 3.32%, exports will contract by 0.14%, and import performance is also projected to contract by 7.02%. This is the scenario figure if the VAT rate is increased to 12.5%. However, when the new government comes in January 2025, the VAT rate is planned to increase to 12% so the figure will be around this prediction. (Kontan)
ADRO thermal coal business spin-off
Adaro Energy (ADRO) announced that it will sell all shares under Adaro Andalan Indonesia (AAI). This effort is expected to have a positive impact on Adaro’s business diversification in the future. ADRO explained that the company would offer 99.99% of AAI shares or the equivalent of 7B shares owned directly by the company. These shares will be offered to all ADRO shareholders on a certain date, which will be announced in the public offering prospectus by shareholders (PUPS). ADRO management also explained that it would distribute dividends before the spin-off was carried out. Details regarding the dividend payout ratio will await approval from shareholders on the EGMS agenda on 18 Oct 24. The offering price for AAI shares uses the weighted average price formed after the close of trading on the day AAI shares are listed on the Exchange. Meanwhile, the value of the planned AAI share sale transaction will take into account the results of the share assessment from an independent appraiser, namely USD 2.45 billion. This estimate is equivalent to 31.8% of ADRO’s total equity. (Bisnis Indonesia)
ASSA realized IDR 577.6B capex in 1H24
Adi Sarana Armada (ASSA) had realized a capex of IDR 577.6B in 1H24 from allocated funds worth IDR 1.3-1.5T. The majority of capex was used for revitalization and purchasing vehicle units in the rental business. In 1H24, net profit increased by 84.58% yoy to IDR 128.42B although revenue was recorded to have decreased slightly by 0.87% yoy to IDR 2.36T yoy. This was due to the efficiency carried out by the Company, especially in its subsidiary Anteraja, and the synergy between the Company’s logistics ecosystem and CargoShare. The rental business is the main driver, contributing 39% of ASSA’s total revenue, followed by the express and logistics business at 37%, the used vehicle sales and auction business at 23%, and the rest from other segments. Looking ahead to 2H24, ASSA is optimistic that its positive performance will continue and exceed that of 1H24. (Kontan)