BBCA - Healthy 1Q25 earnings growth; inline

KBVS Update
Thursday, 24 April 2025

BBCA: Healthy 1Q25 earnings growth; inline
(Maintain BUY; GGM TP: IDR12,510)

* BBCA's 1Q25 earnings demonstrated a strong 9.8% yoy growth, positioning it well against the 24.1%/24.1% consensus and our forecasts (1Q24 run-rate: 23.5%). While exhibiting a modest 2.8% qoq growth, the IDR 14.1tn in 1Q25 earnings met the IDR 14.0tn consensus forecast and surpassed our IDR 13.7tn 1Q25F net income projection for BBCA by 3.2%.

* BBCA's loan portfolio demonstrated exceptional growth across all segment boards, registering a 12.6% yoy surge. This performance significantly outpaced the industry average of 9.16% yoy and exceeded both our ‘25F and management's guidance. Meanwhile, total third-party funds by a solid 6.5% yoy. Notably, high-cost time deposits decreased by 0.9% yoy, further strengthening BBCA's low-cost funding structure.

* BBCA achieved strong profitability in 1Q25, NIM expanding by 20 basis points to 5.8%, surpassing our 2025 forecast. Despite prolonged uncertainty, key risk metrics remained well-managed, with the cost of credit at 0.5% (up from 0.4%) and the gross non-performing loan at 2.0% (compared to 1.9% in 1Q24).

* The 1H25 will be critical in assessing the impact of ongoing global trade tensions, persistent buying power pressure, and prolonged uncertainty. Our cautiously optimistic outlook for BBCA's 2025 earnings hinges on a stable NIM and sound asset quality. Key catalysts include achievable loan growth guidance, a solid low-cost funding base with a robust deposit mix, and manageable risk metrics.

* We maintain our BUY recommendation with a 12-month GGM-based target price of IDR 12,510 (5.0x 2025F P/B), noting the current attractive trading level of 3.5x, below its historical average of 3.7x.

Regards,
Akhmad Nurcahyadi - KBVS Research