BBRI - Ultra Microecosystem reaches 36.1 mn debtors

BBRI - Ultra Microecosystem reaches 36.1 mn debtors The Ultra Micro Ecosystem (UMi), consisting of BRI, Pegadaian, and Permodalan Nasional Madani (PNM), consistently continues to empower MSME actors in Indonesia. Until the end of the second quarter of 2024, the UMi ecosystem was recorded as having distributed loans to 36.1 mn debtors with a loan portfolio distributed reaching IDR622.3 tn, or growing 7.7% yoy. Of the total IDR622.3 tn, IDR496.2 tn of it was distributed through BRI microcredit, IDR77 tn was distributed by Pegadaian, and the remaining IDR49.2 tn was distributed by PNM. BRI Micro Business Director Supari said that the key to the growth of the UMi ecosystem cannot be separated from selective credit distribution (selective growth). BRI will also strengthen its microbusiness positioning with an ecosystem-centric approach, and the strategy of empowerment is at the front of financing. Previously, Minister of SOEs Erick Thohir continued to encourage the performance of the ultra-micro financing distribution business even in the midst of unstable global economic conditions and weakening people's purchasing power. (Source : Kontan) Comment : We expect SME-based loan channels will grow much better in the following quarters. Post the synergy, UMi will continue to play an important role for BBRI growth going forward. Moreover, we also expect the consumer and corporate segments will overall underpin and strengthen loan growth, especially for this year (1H24 figure remains in line with management guidance and our ‘24F total loan growth for BBRI). Maintain BUY BBRI GGM-TP IDR6,830, implying 3.0x ’24F P/B.