CIMB Bakrie Sumatra Plantation Company update - Lack of focus?

(UNSP IJ / UNSP.JK, UNDERPERFORM - Maintained, Rp780 - Tgt. Rp430, Plantations)

Despite a difficult environment, Bakrie's Sumatra's capex spending has been surprisingly quite lax. The company has a variety projects, all part of its growth strategy. However, given volatile CPO prices, cash-management prudence is important, in our view. With around 33% of its nucleus oil-palm plantations still immature, we believe money would have been better spent on this area. Maintain UNDERPERFORM and target price of Rp430, due to the poor visibility of the company's strategy.