Bank Rakyat Indonesia (BBRI) - Strong Main Business

Bank Rakyat Indonesia (BBRI) – Maintain BUY
Price: Rp6,450 – Target Price: Rp7,600

Strong Main Business

  • On 1Q11, BBRI booked net income as much as Rp3.2 tr, above our expectation.
  • Implementation of PSAK 50/55 boosted interest income significantly.
  • Management has decreased NIM of MSME loan as much as 50 bps.
  • Cost to income stood at 35.47%, lower than FY10 42.23% and 1Q11 37.13%
  • NPL slightly increase QoQ to 3.05% from 2.78% but NPL still at manageable level
  • We upgrade our target price as a result of forecast upgrade. TP Rp7,600 reflecting 3.8x PBV
  • Maintain Buy