Concerns about its strategy to explore overseas opportunities,particularly in neighbouring countries such as Malaysia and the Philippines, hit Semen Gresik’ share price.
Management explained that the strategy is still aimed at primarily focusing on the domestic market. The reasons behind the strategy are:
1) capacity constraints,
2) the timing and cost for the new expansions,
3) balance sheet’ flexibility, and
4) transportation costs. Management said it is in a very early stage of discussion with financial advisors and do not expect it to material anytime soon.
We believe the above considerations are reasonable and therefore exploring these opportunities, especially given the current low asset price environment, should not be seen as negative. We do agree that other factors such as costs, locations and synergy are required to further evaluate the strategy.
Our positive stance over the stock remains intact, given
1)relatively resilient demand,
2) oligopolistic market,
3) strong balance sheet, and
4) fragmented geographical markets
Tidak ada komentar:
Posting Komentar