Stockbit Sekuritas has highlighted the current price of PT Bank Rakyat Indonesia Tbk (BBRI) stock as an attractive entry point for long-term investors, despite the challenges posed by foreign outflows and ongoing market uncertainty. The bank's shares have recently seen a significant decline, making it a potential opportunity for those looking to capitalize on undervalued assets, especially given the strong fundamentals and promising dividend yield.

According to Rahmanto Tyas Raharja, Lead Investment Analyst at Stockbit, BBRI's stock is now priced near its lowest point in the past decade (excluding the pandemic period). He noted that the bank's valuation has dropped significantly, with its share price falling by 10% in the past month, reaching IDR 4,400 per share as of November 22, 2024. This decline is largely attributed to the net foreign outflows that have pressured the stock, with BBRI seeing the largest foreign capital outflow on the Indonesian Stock Exchange (IDX) in recent weeks, accounting for 39% of the total foreign outflow from the IDX in November.

"Foreign outflows from BBRI have been almost double those of the second-highest foreign outflow in the same period, which was from Bank Central Asia (BBCA), at IDR 3.6 trillion," Rahmanto said. Year-to-date, BBRI's share price has dropped by 23%, with net foreign outflows reaching IDR 30 trillion. This has led to a decrease in foreign ownership of the bank to just 32.95% as of October 2024, the lowest level in three years.

Rahmanto attributed the outflows to broader trends, including the strengthening of the US dollar and growing concerns about the microbusiness sector. He explained that fears regarding credit costs, asset quality, and growth in this sector have added to the pressure on BBRI's stock.

Despite these challenges, Rahmanto remains optimistic about BBRI's future prospects. The stock's current valuation has fallen to a price-to-book ratio (P/BV) of 2x, marking a -1.5 standard deviation below the bank's five-year average. This puts the stock at its lowest valuation since the recovery period following the COVID-19 market crash in mid-2020. He emphasized that if BBRI's P/BV were to fall to its lowest point in the past decade, which occurred during the 2020 crisis (P/BV of 1.4x), it would imply a further 32% downside to IDR 3,000 per share.

However, Rahmanto also highlighted a key upside: the bank's potential for dividend growth. BBRI's management has signaled a strong possibility of increasing its dividend payout ratio to 85%, up from 80% in 2023, provided shareholders approve. This would result in a dividend yield of around 7.8% based on the current price of IDR 4,400 per share. "For long-term investors, this is an appealing entry point, especially considering the bank's improving fundamentals and a dividend yield approaching 8%," he added.

While there are risks—such as further declines in stock price if foreign outflows continue and potential asset quality deterioration in the micro segment—Rahmanto remains hopeful that BBRI will avoid revisiting its lowest valuation levels. With improving credit costs and asset quality, the downside risk appears limited, and the attractive dividend yield provides a buffer for investors until foreign outflows stabilize and asset quality improves.

INVESTOR.ID