Updated: Oct 28
Two of the world’s leading battery producers of electric vehicles (EV), Contemporary Amperex Technology Co. Ltd. and LG Chem Ltd., have signaled on joining projects that could bring in $20 billion investment in supply chains in Indonesia, according to the country’s government. Both firms collectively signed heads of agreement with Aneka Tambang Tbk in September which aims to manufacture higher value products for automotive batteries from the state-owned miner’s nickel output. Furthermore, the strategy itself involves the development of new capacity for metals processing to battery pack assembly. Septian Hario Seto, Mining Deputy of The Coordinating Ministry for Maritime Affairs and Investments, claims that this is a race on technology between the two front-runners in lithium battery technology. Despite being in the very early stages, the start of the agreed joint venture options between LG Chem Ltd. and Aneka Tambang Tbk, brought upon a ray of prominence for the stated companies. Looking from the capital market perspective, Aneka Tambang had risen as much as 18% in Wednesday trading, as of 12.52 pm in Jakarta.
The project carried out had an impact on the movement of shares of MIND ID's subsidiary companies, namely PT Timah Tbk (TINS), PT Vale Indonesia Tbk (INCO), and PT Aneka Tambang Tbk (ANTM). PT Timah Tbk (TINS) managed to increase 6.83% to Rp860 after previously rallying 15.44%, while PT Vale Indonesia Tbk (INCO) also managed to reach the green zone for 4.04% to Rp 4,120 after having appreciated 4.57% during the week. It was observed from the four MIND ID subsidiaries that took the floor on the IDX, only the coal issuer PT Bukit Asam Tbk (PTBA) failed to rise as it remains stagnant at the level of Rp. 2050 / unit during the week. Seeing the rally in state-owned mining stocks over the past week such an increase from ANTM, TINS and INCO, has created a sense of optimism among market players about the plan to form this battery holding. However, keep in mind that Inalum Cs battery company will be processed in 2023, so the positive impact that will possibly appear on the financial statements of each issuers will not come in the near future.
In response to the rise of BUMN holding subsidiary shares, JCI subsequently rose as well. Last Monday (10/19), JCI in early trading ended in the green zone. Later that day, top gainers were led by PT Aneka Tambang Tbk (ANTM), which reached a trading volume of 1.2 billion shares. Apart from ANTM, other top gainers are PT Karya Bersama Anugerah Tbk (KBAG), with 5 cumulative trading days has significantly increased by 15%, PT Timah Tbk (TINS) which increased by 6.83%, PT Wismilak Inti Makmur Tbk (WIIM) which increased by 6.67%, and PT Bumi Serpong Damai Tbk (BSDE), which rose 6.29%. The global stock market is entering the financial reporting period of the third quarter of 2020. According to data from Refinitiv, among the 49 companies in the S&P 500 that have reported their performance, 86% have performed well. In Indonesia, the performance of listed companies is projected to grow positively in the third quarter, supported by various efforts from the government. All in all, a massive $20 Billion EV Plans by top battery makers has encouraged BUMN mining industry shares and is also bringing a positive impact to the JCI.
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