Jun-26 4W sales increased 12% MoM, supported by BYD and Daihatsu. Indonesia’s 4W sales reached 78K units in Jun-26 (+12.0% MoM, +32.9% YoY), driven by BYD recovery to 5.3K units after May supply disruptions. ASII market share declined to 52% (May-26: 56%) as BYD regained share, while LCGC sales rose to 9.5K units (+14.8% MoM, +13.9% YoY) despite weaker purchasing power. We maintain 2026F sales at 820K units (+2% YoY), supported by EV growth but pressured by high rates, weak IDR, and higher vehicle prices.

EVs regained market share to 30% (1H26: 26%), expected to reach 35% in FY26F. xEV market share recovered to 30% in Jun-26 (May-26: 25%) after BYD’s supply constraints, with 6M26 share reaching 26% (6M25: 16%), driven by BEVs (+84% YoY) and HEVs (+42% YoY). We expect xEV penetration to exceed 35% in 2026F and 40% in the next 2–3 years, supported by incentives and new model launches. However, mid-to-low income consumers are expected to remain focused on ICE vehicles due to lower prices and better resale values amid weaker purchasing power.

Neutral on automotive sector with ASII as a HOLD with TP of IDR 5,100. We maintain Neutral on the auto sector amid weak purchasing power, volatile fuel prices, and higher interest rates, while EV adoption remains resilient. We prefer ASII (HOLD, TP: 5,100) due to its large-cap profile and attractive valuation. DRMA (HOLD, TP: 950) focuses on cost efficiency to protect margins, while ASLC (HOLD, TP: 65) may benefit from stronger used-car demand, although earnings were revised down due to lower JBA contribution and margins.