JPMorgan cuts SCMA stock rating to neutral, keeps target

Published 28/02/2025, 07:24
JPMorgan cuts SCMA stock rating to neutral, keeps target

On Friday, JPMorgan downgraded Surya Citra Media Tbk (SCMA:IJ) (OTC: PTBKF) stock from Overweight to Neutral, maintaining a price target of IDR200.00. The firm’s analysts cited the stock’s significant outperformance compared to the index, with a year-to-date increase of 25% and a 40% rise over the past year, while the Jakarta Composite Index (JCI) declined by 7% and 10%, respectively.

The analysts at JPMorgan suggested that investors take profits on SCMA shares, highlighting the stock’s robust performance against the backdrop of a challenging market. They acknowledged the potential upcoming catalyst for SCMA’s over-the-top (OTT) business, Vidio.com, which could come from either private funding rounds or an initial public offering (IPO) in the public market.

Vidio.com, Indonesia’s leading Subscription Video On Demand (SVOD) platform, has achieved impressive growth with over 4 million paid subscribers. JPMorgan’s analysts expressed optimism about Vidio’s strong execution but also conveyed caution regarding the market environment for tech-related fundraising.

The analysts pointed out that the anticipated direction of interest rates, which is expected to remain high for a longer period, could pose a risk to maintaining or increasing Vidio’s recent fundraising valuation, which stands at approximately $1 billion. This financial landscape, they noted, raises concerns about the ability to grow the valuation of SCMA’s OTT business in the near future.

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