When the rupiah exchange rate continues to fall as it is today, the Composite Stock Price Index (CSPI) seems difficult to return to 6,000 points.

However, it does not mean that market participants can not invest in the stock market when rupiah is declined. Because, some export-oriented issuers are cheerful because the weakening of the rupiah against the US dollar (US) has the opportunity to boost the company’s financial performance.

Securities analysts agree that the appreciation of the US dollar against the rupiah provides a positive sentiment for listed companies based on plantations, mining and textiles.

If most commodities are sold on an export basis, the majority of the company’s revenues will be in US dollars. That way, the company will get a bigger profit when converting its revenue into the rupiah exchange rate.

“The performance of the first semester of 2018 is predicted to rise,” continued Lucky.

Looking at both companies’ financial performance in the first quarter of 2018, Astra Agro Lestari and the London Sumatra Indonesia Plantation Company posted a decrease in net income and net income.

Astra Agro Lestari, for example, posted a 55.03 percent net profit to Rp355.45 billion from Rp790.45 billion in the first quarter of 2017. This is because the company’s revenue also fell 1.11 percent from Rp4.49 trillion to Rp4.44 trillion.

Meanwhile, net income of London Sumatra Indonesia Plantation Company fell 64.6 percent to only Rp115.99 billion from the previous Rp327.68 billion. This decline occurred because the company’s revenue slumped to Rp868, 33 billion, while in the first quarter of 2017 reached Rp1, 46 trillion.

“With rupiah conditions like this target stock price (AALI and LSIP) could rise 7 percent from closing Friday (20/7) yesterday,” continued Lucky.

At the end of last week, Astra Agro Lestari’s share price ended at Rp10.650 per share or closed stagnant. Then, the London Sumatra Plantation Company of Indonesia rose 2.06 percent to Rp990 per share.

In addition, mining shares that will benefit from the weakening of the rupiah, such as PT Bukit Asam Tbk (PTBA), PT Aneka Tambang Tbk (ANTM) and PT Adaro Energy Tbk (ADRO).

“When the US dollar strengthens it is good for mining companies, the majority of exporters, commodity prices are also okay,” said Lucky.

Lucky explained that the price of Comex gold futures rose 0.64 percent last weekend to US $ 1,231.9 per troy ounce. According to him, the price of gold will still strengthen up to the level of US $ 1,255.00 per troy ounce.

“The price of coal is also still around US $ 100 per metric ton,” added Lucky.

Furthermore, Binaartha Sekuritas Muhammad Nafan Aji Gusta Utama analysts call PT Sri Rejeki Isman Tbk (SRIL) or Sritex will also enjoy the benefits of rupiah depreciation.

Understandably, these textile-based issuers also penetrated overseas markets as the target consumers. Referring to the financial statements of issuers in the first quarter of 2018, the company markets its products to Asia, Europe, USA, Latin America, United Arab Emirates, Africa and Australia.

Total export sales alone in the first three months of this year amounted to US $ 145.37 million, while domestic sales only US $ 122.46 million. As a result, total sales in the first quarter of 2018 amounted to US $ 267.83 million.

“The performance of Sri Rejeki Isman also consistently increased, maybe this year could be doubled up,” said Nafan.

In this case, Sri Rejeki Isman recorded a 49.57 percent sales increase in the first quarter of 2018 from the first quarter of 2017 position of US $ 179.06 million.

Not surprisingly, the company’s net profit was boosted 84.63 percent from US $ 22.39 million to US $ 41.34 million.

Meanwhile, Sri Rejeki Isman’s share price at the end of last week rose 1.74 percent to Rp350 per share. Shares of Sri Rejeki Isman observed continued uphill since Thursday (19/7) yesterday, at which time the stock price closed at the level of Rp334 per share.

(Source: CNN Indonesia)