BMRI Target Price Raised to Rp 6,200 as Profit Beats Forecasts

JAKARTA, Investortrust.id — PT Bank Mandiri Tbk or BMRI has its target price revised higher to Rp 6,200 on Tuesday, Feb 10, 2026 in Jakarta after the lender delivered 2025 profit above analyst forecasts on lower operating and credit costs, a move expected to reinforce the stock buy case despite tighter margins.

Bank Mandiri booked 2025 net profit of Rp 56.29 trillion, equal to about $3.5 billion, up 1% from Rp 55.78 trillion a year earlier and equivalent to 114% of BRI Danareksa Sekuritas estimates and 110% of Bloomberg consensus.

BRI Danareksa analysts Naura Reyhan Muchlis and Victor Stefano said the outperformance was driven by cost discipline and a lighter provisioning burden than expected.

The brokerage said fourth quarter net profit reached a record Rp 18.6 trillion, rising 40% quarter on quarter and 35% year on year, marking the highest quarterly profit in the bank history.

The analysts linked the earnings strength to still solid loan growth, stabilizing margin dynamics at the bank only level, and a surge in fee driven income that offset NIM compression.

BMRI posted 13% year on year loan growth, led by corporate and commercial segments, while net interest margin was compressed by 30 basis points even as net interest income still rose 4%.

Funding momentum also stayed robust, with third party funds increasing 24% year on year, led mainly by time deposits, bringing the loan to deposit ratio down to 89% and easing liquidity pressure.

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Non interest income increased 9% year on year, supported by fee based income and one off items, while the bank also benefited from recovery related income in the quarter.

Asset quality remained firm, with the bank keeping its non performing loan ratio stable around 1.1% and lowering cost of credit to 58 basis points, even as the coverage ratio was described as lower.

BRI Danareksa pointed to unusually low credit costs in the fourth quarter, with cost of credit at 0.2%, which it tied to a sharp drop in provisioning and a revision to the loss given default methodology.

The brokerage also highlighted operating leverage, with operating expenses rising only 2% quarter on quarter and falling 6% year on year, helping lift profitability in a quarter when margins were under pressure.

“Supported by solid fundamentals and an adequate risk buffer, we are very optimistic that Bank Mandiri can continue to grow sustainably while carrying out its role as an agent of development in supporting national economic growth,” President Director Riduan said during the fourth quarter 2025 results briefing on Thursday, Feb 5, 2026.

Riduan warned that the operating environment remained uneven despite a more accommodative monetary stance, arguing the benefits of lower rates would take time to reach the real economy.

“Entering early 2026, the challenges we are observing still come from global uncertainty that has not fully eased,” Riduan said. “Domestically, although monetary policy is more accommodative, the transmission of rate cuts to the real sector is still gradual, so the impact on economic activity and financing has not been evenly distributed.”

He said the bank continued to steer lending toward more resilient sectors, pairing selective growth with tighter portfolio monitoring.

“Because of that, at Bank Mandiri we consistently direct lending to sectors that are prospective and have strong resilience,” Riduan said, adding, “Supported by Bank Mandiri discipline, with strong underwriting capability and tight portfolio monitoring.”

The bank said it ended 2025 with NPL gross of 0.96%, below the industry average, as it emphasized disciplined risk management across segments.

“An NPL coverage ratio that we have built is still quite strong at 253% as an anticipatory step against potential deterioration in asset quality and pressure from future economic risk,” Riduan said.

Re rating thesis and what changes in the Rp 6,200 target

BRI Danareksa maintained its buy rating and raised its target price to Rp 6,200 from Rp 5,500, reflecting higher profitability assumptions and a richer valuation multiple.

The brokerage said the target was based on 1.8 times price to book value and lifted its return on equity assumption to 18.8% from 16.7%, arguing that operational efficiency and lower credit costs were more durable than previously modeled.

The upgraded view also leaned on management 2026 guidance calling for normalized growth, with loan expansion of 7% to 9%, NIM of 4.6% to 4.8%, and cost of credit of 0.6% to 0.8%.

Bank Mandiri said it aimed to keep the loan to deposit ratio below 95% and maintain a cost to income ratio around 42% to 43%, reinforcing the message that balance sheet discipline would remain central.

Management also indicated a dividend payout ratio target of 65% to 70%, supported by what it described as still strong capital.

Beyond the parent bank, investors track subsidiaries and BSI contribution

The bank noted that it no longer consolidates the financial statements of PT Bank Syariah Indonesia Tbk, while emphasizing there was no change to its ownership stake.

In its presentation, Bank Mandiri reported BSI as the largest profit contributor among subsidiaries, with net profit of Rp 5.56 trillion as of September 2025, while BSI assets reached Rp 416.57 trillion and accounted for a significant share of total subsidiary assets.

For equity investors, the BMRI investment case is now increasingly framed as a combination of stable core banking profitability, stronger cost efficiency, and the ability to defend asset quality through the cycle, with the target price revision signaling renewed confidence that earnings can stay above consensus even as the macro environment normalizes.