REPUBLIKA.CO.ID, JAKARTA -- PT Bank Rakyat Indonesia Tbk (BBRI) shares hit a record high All Time High (ATH) at Rp 6,375 on Wednesday (21/2/2024).

As year-to-date, BBRI shares have risen 11.35 percent and have repeatedly broken new records. At the close of trading Wednesday, BBRI shares were still strong at Rp 6,300 per share with a market capitalization of Rp 954,82 trillion.

The catalyst for the increase in the share price was driven by impressive financial performance in 2023, thanks to credit growth reaching double digits mainly in the MSME segment. In terms of intermediation functions, by the end of December 2023, BRI managed to drive credit distribution to grow by 11.2 percent yoy to Rp 1,266.4 trillion. This achievement was recorded higher compared to the national banking industry's credit disbursement of 10.4 percent yoy throughout 2023.

When detailed, all BRI loan segments recorded positive growth, micro segment recorded growth of 10.9 percent yoy to Rp 611.2 trillion, consumer segment grew 13.4 percent yoy to Rp 190.0 trillion, small and medium segment grew 8.6 percent yoy to Rp 267.5 trillion and corporate segment grew 13.8 percent yoy to Rp 197.7 trillion.

With such positive achievements, a number of analysts from various reputable securities companies recommend Buy shares of BBRI.

“BBRI posted solid credit growth in FY23 or grew 11.2 per cent yoy, driven primarily by the micro and medium segments. For FY24, BBRI set a target range of credit growth of 11—12 per cent yoy supported by the micro segment. One of them is Kupedes, which grew 64 percent, '” Samuel Sekuritas Indonesia analyst Prasetya Gunadi was quoted as saying Thursday (22/2/2024).

Analysts recommended a buy for BBRI as it looks at the performance of the stock and also the company will continue to post credit growth of the ultramicro segment, including from PNM and Pawn Shop.

“We also forecast that the credit growth of the ultra micro segment (PNM and Pawn Shop) will continue to outpace bank-only credit, and will account for more than 12 percent of total BBRI credit by 2024F (an increase compared to 2023's 9 percent),” he said.

Given the target range for credit growth in this year which will reach a range of 11—12 per cent yoy, with it BBRI is most likely to manage to post EPS growth of 10.9 per cent yoy in the 2024 full year performance.

Prasetya Gunadi recommends Buy BBRI shares with a target price of Rp 6,800 per share, implying a PBV of 3.1x. The target is supported by a solid capital structure.

“We still like BBRI as we believe BBRI will continue to post double-digit credit growth next year, supported by the ultramicro and Kupedes segments, which will help stabilize NIM despite pressure from CoF (Cost of Funds),” he wrote.

On a separate occasion, the President Director of BRI Sunarso revealed that the existence of ultramicro holding will serve as a new source of growth for the company. BRI will remain focused on SMEs, especially in the ultramicro segment. Therefore, continuing its performance and strategy, ultramicro holding will remain a top priority as a source of new growth. Sunarso added that by the end of December 2023, Ultramikro Holding successfully integrated 37 million borrower customers.

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