Indopremier ITMG – BUY ( Tp – Rp18.495)

Valuation
With WACC of 12.4%, our current estimates in the DCF calculations resulted in the share price of ITMG to be valued at Rp18.495 per share, still gives potential upside of 8.5% from yesterday’s closing price of Rp17.050. From earnings multiple valuation , at Rp17.050, the share is trading at 6.82 X FY09 earnings, which is below the market rating of 10 X FY09 earnings. We view upsides exist in our DCF-based valuation calculation. In addition , ITMG share price characteristic is that it has a high volatility,daily standard deviation of return of 5.8% in 2008 (vs. the JCI of 2.5%), and this provides trading opportunity to investors.

Recommendation
ITMG is a listed coal producer with a good fundamental, strong balance sheet and cash position, and also with sufficient management transparency. We retain our BUY recommendation.