/2014/04/23/494708479p.jpg)
ISSUER NEWS - JAKARTA. The performance of PT Bank Central Asia Tbk (BBCA) in 2024 is expected to remain strong. However, analysts predict a slowdown in the growth rate will still occur.
For information, BBCA recorded a net profit growth of 19.4% to IDR 48.6 trillion. However, its growth rate slowed down from 2022, which grew by 29.6%.
Associate Director of Research and Investment at Pilarmas Investindo Sekuritas, Maximilianus Nico Demus, said that the slowdown in BBCA's growth rate was due to the company's operational costs increasing by up to IDR 5 trillion or 5.45% from 2022. Therefore, the potential for a slowdown in the company's growth rate in 2024 still exists.
"However, so far the net income has consistently increased year by year, especially in 2024 BBCA will focus on lending to various sectors amid the potential for a decrease in interest rates," he told Kontan.co.id, Monday (29/1).
Read Also: Bank Central Asia (BBCA) Profit Soars 19.4% to IDR 48.6 Trillion in 2023
Therefore, Nico sees that this year BBCA will continue its excellent performance. Especially with the maintained recovery of the national economy, purchasing power and consumption, and the potential for a decrease in The Fed's interest rate.
According to him, the decrease in The Fed's interest rate will drive this credit increase. In addition, the increase in transaction activities due to increased purchasing power and consumption due to the election is also expected to boost BBCA's performance this year.
"In 2023 alone, the total transaction volume increased by 25.1%, doubling in the last 5 years," he explained.
Nico predicts that BBCA's net profit will grow around 10% to IDR 53 trillion to IDR 55 trillion. He also recommends buying BBCA with a target price of IDR 10,700.
Senior Analyst at Sucor Sekuritas, Edward Lowis, also views that BBCA's net profit grew 12% in 2024 to IDR 54.39 trillion. "We anticipate an increase in interest income with an increase in asset returns," he said.
However, Edward continued, BBCA management sees moderate credit growth of 8%-10% in 2024. This comes from a high base in 2023, while business credit demand is expected to slow down due to the election year.
BBCA also plans to adjust the credit interest rate by 25-50bps this year after maintaining it during the recent interest rate hike. NIM is conservatively projected to remain stable at the 5.5%-5.6% level.
On the other hand, the overall asset quality is projected to further improve with the risky credit ratio (LAR) possibly decreasing to 4%-6% compared to 2023 at 6.9%.
"This improvement will allow the company to maintain low credit costs at 30-40bps because the LAR coverage remains sufficient at 70% in 2023," he explained.
Sucor Sekuritas maintains a buy recommendation for BBCA with a target price of IDR 10,500 supported by strong asset quality and deposit franchise, coupled with extraordinary profitability with the highest ROE in the industry that will continue to justify high valuations.
