AnalystConsensusTarget updated the narrative for BMRI

Analysts have raised their fair value price target for Bank Mandiri (Persero) slightly from IDR 5,436.15 to IDR 5,439.19. This adjustment comes as optimism increases following policy measures designed to bolster the nation’s banking liquidity.

Analyst Commentary

Recent upgrades and changes in sentiment reflect a reassessment of Bank Mandiri (Persero)'s growth prospects and operational outlook following new government initiatives. The changes in fair value targets are driven by views on liquidity dynamics, bank fundamentals, and sector positioning.

Bullish Takeaways

• Bullish analysts expect Bank Mandiri to benefit from the government's announced liquidity injection, which is aimed at enhancing banking system resilience and supporting deposit flows.
• There is growing optimism about the bank’s potential to outperform domestic peers. Increased liquidity could translate into improved lending capacity and more stable net interest margins.
• The upgrade in price target reflects expectations for improved execution on growth strategies, capitalizing on Indonesia's recovering economic environment.
• Analysts highlight that with a new price target of IDR 5,850, there is meaningful upside potential from current trading levels, especially given an improving policy backdrop.

Bearish Takeaways

• Bearish analysts remain cautious about the sustainability of margin expansion. External pressures and increased competition may limit upside to profitability.
• There are lingering concerns that structural risks in the broader Indonesian banking sector could restrict Bank Mandiri’s ability to fully leverage new liquidity.
• Some analysts point to potential execution risks if loan growth fails to accelerate as expected or if deposit costs rise more quickly than anticipated.

Valuation Changes

• Consensus Analyst Price Target (Fair Value): Rose marginally from IDR 5,436.15 to IDR 5,439.19, reflecting updated optimism about the bank's outlook.
• Discount Rate: Increased slightly from 14.53% to 14.54%, indicating marginally higher perceived risk or required return.
• Revenue Growth: Improved from 11.64% to 12.16%, suggesting higher expectations for future top-line expansion.
• Net Profit Margin: Increased modestly from 31.62% to 31.98%, indicating expectations for greater efficiency or profitability.
• Future P/E: Declined from 12.46x to 12.07x, which may imply higher forecasted earnings relative to share price.