BFIN Why Did Bookings Reverse the Same Quarter the Stock Fell 30%?

The Brakes Come On, But the Credit Cycle Hasn't Followed

Q1's post closed on Cost of Credit's sharp reversal from Q4 2023's 0.8% back to 3.7%, and asked whether that reversal itself was a new, stable level or another single data point in a metric that keeps swinging. H1 2024 gives an answer, and it isn't reassuring: Cost of Credit climbed again in Q2, to 4.4% - up 70 basis points quarter-over-quarter from Q1's 3.7%, the third consecutive quarter the number has moved, and every move has been in the direction of more credit stress, not less. The half-year figure of 4.0% reads as roughly flat against 1H23's own 4.0% (the company's presentation puts the year-over-year gap at just 5 basis points), but that framing flattens a number that has done nothing but climb within 2024 itself - 3.7% in Q1, then 4.4% in Q2. A cumulative half-year average that looks stable is exactly the kind of number that hides a quarter-over-quarter trend, and here the trend is unambiguous.

The other side of this quarter's story is what management chose to do about it. New bookings reversed to Rp4,306 billion in Q2, down 10.0% quarter-over-quarter from Q1's Rp4,783 billion - breaking three straight quarters of sequential growth that had been read, including in this backlog's own prior post, as a genuine recovery signal. The company's own framing is candid about the reason: "continued risk and soft market conditions resulting in a more cautious business approach." That's a company choosing to originate less rather than chase volume into a credit cycle it can't yet call turned - a defensible choice on its own terms, but one that arrives in the same quarter Cost of Credit kept climbing, meaning the caution hasn't yet shown up as improvement in the metric it's presumably meant to protect. Net profit for the six months ended 30 June 2024 fell 19.2% year-over-year, to Rp685,796M from Rp848,397M - a smaller percentage decline than Q1's standalone 29.0%, but that's arithmetic, not improvement: Q2's profit fell 10.3% quarter-over-quarter from Q1's own base, the fourth straight quarter of sequential profit decline this backlog has tracked.

The Prescription

A lender that pulls back on new bookings while its own headline credit metric keeps deteriorating hasn't yet proven the pullback is working - it's proven it's willing to sacrifice growth for a result it can't yet show. BFI should keep the booking discipline it adopted this quarter, but it should pair that discipline with a genuine, dated commitment to when Cost of Credit is expected to actually turn - not another "to be reflected in subsequent period" from a slide, but a number tied to the current underwriting cohort, so a reader can judge the caution against its own stated timeline rather than watching the metric drift quarter to quarter with no reference point.

What the company should stop doing: letting the restructured-loan balance disappear from disclosure entirely. Every post in this stretch since H1 2022 has asked BFI to restore the cure rate and second-restructuring share it stopped disclosing eight filings ago - and even through that stretch, the restructured balance itself had at least remained a disclosed figure (Rp29,436M as of Q1 2024, per the prior post). This filing's financing-receivables note doesn't carry that line at all (see Beyond the Usual below). A pool this small in absolute terms costs the company nothing to keep disclosing, and its continued disappearance - now total, not partial - is the wrong direction at exactly the quarter Cost of Credit and net NPF are both trending the wrong way.

Key Financial Metrics

Six months ended 30 June 2024 vs. six months ended 30 June 2023

FX: Rp16,343 = USD 1 (28 June 2024 close, the closest trading day to period-end). Both periods below are converted at this same rate for comparability, following the convention used throughout this backlog - it is not a historical rate for the H1 2023 column.

Metric	H1 2024 (IDR)	H1 2024 (USD)	H1 2023 (IDR)	YoY
Total Income ("Net Revenue" equivalent)	Rp3,108,662M	~$190.2M	Rp3,199,717M	⚠️ -2.8%
Profit Before Tax ("Operating Income" equivalent)	Rp844,539M	~$51.7M	Rp1,049,900M	⚠️ -19.6%
Net Income	Rp685,796M	~$42.0M	Rp848,397M	⚠️ -19.2%
Total Cash and Cash Equivalents	Rp1,739,952M	~$106.5M	Rp2,567,492M	⚠️ -32.2%

Profit before tax remains the closest operating-income equivalent for this lender, as established throughout this backlog. Total income fell a comparatively modest 2.8%, meaning most of the profit decline is again a margin story: operating expenses (including impairment provisions) grew 5.3% year-over-year even as revenue shrank, with the impairment charge itself up 8.6% YoY (Rp484,761M from Rp446,255M across financing and Ijarah receivables) - a smaller increase than Q1's standalone 34.4% jump, but still growing off an already-elevated base. Combined operating and investing cash flow swung from an outflow in H1 2023 to a net inflow this half - a genuine improvement, but one driven mainly by slower new-booking volume needing less cash to fund, not by stronger collections. Total cash fell 32.2% year-over-year to Rp1,739,952M, continuing a decline from H1 2023's elevated post-bond-issuance level; quarter-over-quarter it was essentially flat (Rp1,739,659M at FY2023 to Rp1,739,952M now).

Basic earnings per share fell to Rp46 for H1 2024 from Rp56 a year earlier (-17.9%), on an unchanged weighted-average share count - a smaller percentage decline than the net-income figure because H1 2023's own EPS was already carrying the year's front-loaded profit.

Balance sheet metric	30 Jun 2024 (IDR)	30 Jun 2024 (USD)	30 Jun 2023 (IDR)	YoY ∆
Total Assets	Rp24,292,304M	~$1,486.5M	Rp25,176,796M	✅ -3.5%
Financing Receivables (net)	Rp20,888,381M	~$1,278.2M	Rp20,990,220M	✅ -0.5%
Total Liabilities	Rp14,613,819M	~$894.3M	Rp16,072,457M	✅ -9.1%
Fund Borrowings (net)	Rp10,787,826M	~$660.2M	Rp9,686,899M	⚠️ +11.4%
Securities Issued (bonds, net)	Rp2,867,859M	~$175.5M	Rp5,370,683M	✅ -46.6%
Total Equity	Rp9,678,485M	~$592.2M	Rp9,104,339M	✅ +6.3%

Debt-to-equity^» (OJK Gearing Ratio) climbed back to 1.41x, from Q1 2024's 1.36x - reversing most of Q1's de-lever and landing exactly at FY2023's own 1.41x. The move is driven by fund borrowings rising 11.4% year-over-year even as bond issuance kept shrinking: Rp1,857,000M of securities were repaid this half with no new issuance recorded in the cash flow statement, pushing securities issued down 46.6% YoY, while bank borrowings grew to fill the gap. The related-party PT United Tractors Tbk facility - flagged since Q1 2020 - continued amortizing on schedule, with its drawn balance falling to Rp368,526M from FY2023's Rp432,257M, still against an unchanged Rp1,250,000M limit and a 20 June 2027 maturity.

Key Operational Metrics

• New financing originations: Rp4,306 billion for Q2 2024 (excluding Pinjam Modal channeling), down 10.0% quarter-over-quarter from Q1's Rp4,783 billion - reversing three straight sequential increases (see The Brakes Come On above). For the half, new bookings totaled Rp9,089 billion, down 11.8% year-over-year from H1 2023's Rp10,300 billion.
• Managed receivables (including off-balance-sheet joint financing, per the deck): Rp22,449 billion, essentially flat both year-over-year (+0.3%) and quarter-over-quarter (-0.3%) - the company's own presentation describes this as "stable."
• Non-Performing Financing (NPF) (company's own disclosed figure^», gross basis): 1.47% at Q2 2024, up 23 basis points quarter-over-quarter from Q1's 1.24%, but down 47 basis points year-over-year from Q2 2023's 1.94%. NPF coverage fell to 2.6x from Q1 2024's 2.9x, though up from Q2 2023's 2.3x. Net NPF worsened for a third straight quarter, to 0.29% from Q1's 0.23% and FY2023's 0.15% - a steady quarter-over-quarter climb this backlog hasn't seen before.
• Cost of Credit (CoC): 4.4% for Q2 2024 alone, up 70 basis points quarter-over-quarter from Q1's 3.7% - the third straight quarterly increase; 4.0% for H1 2024 overall, roughly flat against H1 2023's own 4.0% on a cumulative basis, a framing that obscures the quarter-over-quarter climb (see above).
• Net Interest Spread: 12.0% for H1 2024, down 117bps from H1 2023's 13.2%; 11.9% for Q2 2024 alone, down a further 13bps from Q1's 12.1%.
• Cost to Income: 47.8% for H1 2024, up sharply from 42.8% a year earlier (+500bps); 47.7% for Q2 2024 alone, a marginal 23bps improvement from Q1's 48.0%.
• Return on average assets (after tax): 5.7% for H1 2024, down from 7.0% a year earlier (-131bps); 5.4% for Q2 alone, down from Q1's 6.1%.
• Return on average equity (after tax): 14.1% for H1 2024, down from 18.6% a year earlier (-447bps); 13.4% for Q2 alone, down from Q1's 14.9%.
• Earnings per share: Rp46 basic for H1 2024, down from Rp56 a year earlier (see Key Financial Metrics above).

Every profitability ratio this backlog tracks - ROAA, ROAE, Net Interest Spread, and Cost to Income - moved the wrong way both year-over-year and quarter-over-quarter, extending the reversal flagged in Q1 into a second straight quarter. Indonesia's own industry NPF benchmark stood at 2.77% in May 2024, per the company's disclosure - meaning BFI's 1.47% still compares favorably to the sector even as its own trend line worsens, a genuine mitigating context the deterioration above shouldn't be read without.

Three Segments, Still All Declining - But the Order Has Changed

The company reports Cars, Motorcycles, and Others on the same half-year basis as every prior period in this backlog.

Cars - still the largest segment: Rp2,107,235M of income for H1 2024 (67.8% of total, up from H1 2023's 65.1%), up slightly year-over-year (+1.1%) on continued volume - but profit before tax fell 25.5% YoY to Rp535,880M from Rp718,878M, with net profit down 25.1% to Rp435,154M. This is now the segment carrying the largest profit decline of the three, a reversal from Q1's pattern where Motorcycles and Others had fallen harder in percentage terms.

Motorcycles - Rp500,400M of income (16.1% of total, down sharply from H1 2023's 21.3%), down 26.7% YoY on a shrinking book - but profit before tax fell only 7.1% YoY to Rp160,723M from Rp173,000M, the mildest decline of the three segments this half, a marked improvement from Q1's pattern of Motorcycles absorbing the heaviest damage.

Others (heavy equipment/machinery, property, and sharia financing) - Rp501,027M of income (16.1% of total, up from H1 2023's 13.5%), up 15.7% YoY on continued growth - but profit before tax fell 6.4% YoY to Rp147,936M from Rp158,022M, the same magnitude of decline as last year despite the segment's revenue expansion.

All three segments posted a year-over-year decline in profit before tax for a second consecutive half - the first instance of this was flagged in Q1 2024 as evidence the credit-quality problem had stopped being concentrated in vehicle-collateral risk. This half confirms it wasn't a one-quarter artifact, though the order has shifted: Cars, the segment historically least exposed to the sharpest swings, is now absorbing the deepest percentage decline, while Motorcycles - the segment that took the earliest and hardest hit through 2023 - is showing the mildest one. That's consistent with a credit cycle that has moved through its worst point for two-wheeler collateral and is now showing up more evenly, or later, in the larger four-wheeler book.

Beyond the Usual

The restructured-loan balance itself is no longer disclosed

BFI stopped disclosing the restructuring cure rate and second-restructuring share starting with the H1 2022 filings - now eight consecutive interim quarters and three annual reports without either figure. Through all of that stretch, the restructured loan balance itself had remained a disclosed line in the financing-receivables note, shrinking every period (Rp29,436M as of Q1 2024, roughly 0.13% of managed receivables). This filing's financing-receivables note carries no such figure at all - not a smaller number, but no line for it. The disclosure gap this backlog has tracked for two years has now gone from partial (the composition metrics missing, the balance still shown) to total (the balance itself gone), at the exact quarter net NPF extended its worst run in this backlog's history (see Key Operational Metrics above) - precisely when a reader would most want to know how much of the loan book is being carried through modified terms rather than genuinely performing.

A cyberattack named once, still un-named a second straight filing later

FY2023's annual report was the first and, so far, only filing to explicitly name and describe the May 2023 cyberattack in its management discussion. Q1 2024's interim statements reverted to generic language, and this filing's own Note 35 (Risk Management) does the same again - IT steering committees, penetration testing, access-management renewal - with no reference to an incident having occurred. Two consecutive interim filings since the annual report's disclosure confirms that precedent was confined to the one document of the year built for narrative rather than audited disclosure, not a new baseline going forward.

An imminent facility expiry with no disclosed renewal, even as the balance keeps growing

The Bank Jago joint-financing facility - expanded to a Rp2,000,000 million ceiling in the days after the cyberattack disclosure, flagged since H1 2023 - grew again to Rp624,368M gross (Rp623,022M net) as of 30 June 2024, up 26.2% from FY2023's Rp493,824M net, even though the current facility agreement is due to expire 5 August 2024, roughly five weeks after this quarter's period-end. This filing (dated 26 July 2024, days before that expiry) states the agreement's "current status" is "still active" but discloses no renewal terms - unsurprising given the filing predates the deadline, but it leaves a now-larger off-balance-sheet funding line's continuation as a genuinely open question for the next filing, not a settled fact.

The treasury mandate's eighth straight quarter at zero, now well past its own halfway point

The 29 June 2022 EGMS authorized disposing of BFI's entire 1,002,732,000-share treasury stock: 75,000,000 shares for the MESOP^» program (executed 11 October 2022) and 927,732,000 shares for sale to Trinugraha Capital or any other party. That larger tranche shows an unchanged treasury balance across eight straight quarter-end filings now - 30 September 2022 through 30 June 2024 - against the 5 November 2025 transfer deadline. With roughly 24 of the mandate's total ~40 months elapsed, the disposal is now well past the halfway point flagged as freshly crossed last quarter, still at 0% executed.

Software intangible assets fell to Rp232,865M net as of 30 June 2024, from FY2023's Rp255,166M - the first decline this backlog has tracked in a line the company's own commentary had framed as an accelerating technology buildout. The shift lines up with the cash flow statement: acquisitions of intangible assets fell to Rp12,416M for H1 2024 from Rp156,128M a year earlier, a sharp pullback in capitalized technology spending that tracks the same booking-volume caution discussed above (see The Brakes Come On), rather than the growth narrative used to describe the same line item as recently as Q1.

The company's investor presentation also discloses a new Rp6,000,000 million Shelf Registration Bonds Phase VI program approved this half, with a first tranche of roughly Rp600,000M targeted for issuance in September 2024 and rated AA-(idn) by Fitch Ratings - a fresh funding program approved in the same half that outstanding securities issued fell 46.6% year-over-year on repayments with no offsetting new issuance (see Key Financial Metrics above), suggesting the funding mix shift toward bank borrowings this half was a temporary bridge rather than a change in strategy.

Target Valuation Range

Market cap ~Rp14,212,218M (~$869.8M) at ~9.60x TTM P/E and ~1.47x P/B - closer to fair value than Q1's overvalued call - the stock fell faster than earnings this quarter, unwinding most of the prior re-rating, but the credit metrics behind the price drop (climbing Cost of Credit, worsening net NPF, a vanished restructuring disclosure) argue the market moved for real reasons, not an overreaction worth buying into.

Using 15,039,383,620 shares outstanding net of treasury (unchanged again this quarter - see Beyond the Usual above) and the Rp945 closing price:

Market cap buildup	H1 2024
Share price (period-end)	Rp945
Shares outstanding	15,039,383,620
Market capitalization	Rp14,212,218M (~$869.8M)
Book value (total equity)	Rp9,678,485M

Peer-multiple sanity check	Q1 2024	H1 2024	Change
P/E (TTM)	~13.47x	~9.60x	down sharply - price fell 29.5% while TTM earnings fell only 1.0%
P/B	~2.05x	~1.47x	down sharply

Market cap is down 29.5% from Q1 2024's ~Rp20,152,774M. TTM P/E uses TTM net income of Rp1,481,198M (FY2023's Rp1,643,799M less H1 2023's Rp848,397M plus this half's Rp685,796M). This time, unlike Q1, price and earnings moved in the same direction, just at very different speeds. TTM net income fell a further 1.0% from Q1's own trailing figure (Rp1,496,417M → Rp1,481,198M) - a modest decline compared to the price's own move. The share price fell 29.5% quarter-over-quarter (Rp1,340 → Rp945), unwinding essentially all of Q1's 11.2% gain and then some. Over the trailing two years (July 2022 through June 2024), the stock ranged from Rp945 (this quarter's own close, a new two-year low) to Rp1,430 (June 2023's two-year high) - a roughly 33.9% swing, just below this backlog's usual >30-40% threshold for a standalone stock-price section, so it's folded in here. At ~9.60x trailing earnings and ~1.47x book against a 14.1% half-year ROAE, the stock no longer looks priced for the recovery narrative Q1's re-rating implied - it looks priced for a business whose credit cycle genuinely hasn't turned yet, which is closer to what H1's own numbers actually show.

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