BRIS - Inline 1H24 result; expect solid growth in 9M24

KBVS Update
Friday, 6 September 2024

Inline 1H24 result; expect solid growth in 9M24
(Maintain BUY; TP: IDR2,970)

* BRIS delivered impressive first-half 2024 results, highlighted by a robust 20.3% year-over-year increase in net profit, which aligns with both our forecast and street forecasts at a run-rate of 51.3%/52.1%. This strength, fueled by factors such as solid financing growth, manageable funding costs, and improved credit quality, suggests continued strong earnings momentum throughout the 9M24.

* Robust financing demand remains intact, with total loan growth of 16.0% year-over-year. We are also pleased to see solid third-party fund growth of 17.5% yoy, bolstered by an improved CASA ratio of 62.05%.

* Risk metrics appear positive, with NPF gross and CoC both improving, decreasing by 32bps and 56bps to reach 1.99% and 0.99%, respectively, compared to 2.31% and 1.55% in the previous quarter. On the margin side, BRIS's NIM also expanded, albeit modestly, from 5.38% in March 24 to 5.51% in June 24.

* The bank secured substantial earnings in Q2 2024, which strongly supports our expectation that BRIS's 9M24 net income will align with both our forecast and the consensus estimate. Ceteris paribus, our 3Q24F PATMI projection for BRIS of IDR1.52tn (10.8% yoy) would result in a cumulative net income of approximately IDR4.92tn in 9M24, representing a 17.2% yoy increase. Maintain BUY, GGM TP of IDR2,970 (pegged at 3.2x ‘24F PB), while currently trading at 2.8x ‘24F P/B, or slightly above its average historical mean of 2.4x.

Regards,
Akhmad Nurcahyadi - KBVS Research