Automotive - Indonesia Juli 4W sales inched up

Automotive - Indonesia Juli 4W sales inched up Indonesia's car sales saw a slight increase in July 2025, with wholesale distribution (from factory to dealer) rising 4.8% to 60,552 units compared to the previous month. Retail sales (dealer to consumer) also grew by 1.8% to 62,770 units. However, the overall trend remains negative. When compared to July 2024, both wholesale and retail sales dropped significantly, by 18.4% and 17%, respectively. For the period of January to July 2025, wholesale figures are down 10.1% yoy, and retail sales have decreased by 10.8%. Despite this, the Indonesian Automotive Industry Association (Gaikindo) is sticking with its target of 900,000 car sales for the year. (Source : Detik.com) Comment : In summary, the Indonesian automotive market in July 2025 experienced a temporary positive lift from the GIIAS exhibition. However, this monthly increase is not strong enough to reverse the negative yoy and cumulative sales trends, which point to ongoing challenges in the market. Gaikindo's unrevised sales target and remain far above our ‘25F expectation. Our ‘25F 4W sales forecast of -6.4% yoy remains challenging (vs. -14.0% in 24A), though our 2H25F of -12.2% yoy (vs. -8.8% in 2H24) sound makes it acceptable. In our view, key 2H25 drivers include: (1) auto events (Jul-Nov), (2) faster interest rate cut transmission to auto loans, and (3) ongoing promotions. EV demand remains robust and could pointedly impact overall ‘25F sales. Maintain Overweight on auto sector and BUY ASII, SOTP-based TP of IDR5,850 (7.3x '25F P/E).