2026-27F: Super Earnings Growth

Capitalizing on deeper integration through Salim’s distribution ecosystem. We expect 2025 to be a turning point for Bank INA Perdana (BINA) with its growth strategy backed by more extensive integration through the Salim Group ecosystem coupled with repositioning to capture ecosystem-driven SME lending opportunities. For Indomaret, BINA plans to leverage its nationwide footprint, paving the way for outlets to serve as low-cost branch extensions, enabling entry into underserved rural markets. Additionally, the bank also plans to roll out franchise financing, BNPL (buy-now-pay-later) solutions for customers, and payroll banking services for Indomaret’s 200k+ employees. Meanwhile, through Indogrosir’s 29+ wholesale outlets, BINA aims to provide supply chain financing for SME partners, covering both start-up capital and recurring inventory needs. To strengthen customer stickiness, BINA also seeks to integrate loyalty programs (e.g. Indogrosir memberships & Poinku) with its deposit and lending products.

From earnings slump to ecosystem-driven structural recovery. Collectively, the above-mentioned initiatives will provide BINA with ecosystem driven structural recovery ahead. That said, we expect reversal of BINA’s 1H25 steep earnings decline with net profit down 64.1% YoY to IDR 24.7bn, pressured by margin compression (2Q25 NIM: 2.8% from 3.3% in 4Q24) on higher funding costs. Additionally, as the management cleaned up its book, we expect improvements on weak assets quality with gross NPL of 4.7% in 1H25 to 4.5% in FY25F, before further coming down to 4.2-4.0% in FY26-27F. In terms of loan growth, we estimate 3.8% for this year, reflecting intense competition across retail and corporate segments, although we see improvement to 7.1% in 2026F and 8.0% in 2027F, helped by BINA’s higher share of MSME loans from ~15% of 2025F loan book to 22% by 2028F, structurally enhancing asset yields and loan quality.

Strong growth stemming from margin recovery – SPEC-BUY on 57.3% upside. Driven by NIM recovery to 2.9% in 2026F and 3.6% in 2027F (from 2.5% in 2025F), BINA’s net profit will experience average earnings growth of 203.6% over the next 2 years. With MSME supply chain financing as core growth driver, NIM is supported by higher-yielding loans and broader cross-selling opportunities across deposits, payments, and digital lending. Integration with Indomaret and Indogrosir provides BINA with unmatched distribution reach and unique competitive edge as the fintech backbone of Salim Group’s consumer ecosystem. We assign SPEC-BUY rating with technical TP of IDR 7,000, underpinned by its rapid turnaround trajectory. Risks to our call: Higher CoF, elevated CoC, and penetration challenges of Salim-related distribution.