KimEng Holcim Indonesia (SMCB IJ): BUY - Best proxy to Indonesia’s infrastructure boom

We initiate coverage on Holcim Indonesia with a BUY and a TP of Rp2,200. We believe Holcim would benefit from the upbeat Indonesian cement market with new capacity ramp as a key growth lever. While the stock trades at a premium of 15.8x 2010F PER versus 12.2x for Semen Gresik and 14.0x for Indocement, we believe it is one of the best proxy to Indonesia’s infrastructure boom.