Mandiri Sekuritas Gudang Garam: 1Q10 net income was inline with our forecast and consensus (GGRM, Rp27,600, Buy, TP: Rp30,000)

􀂄 Gudang Garam posted 1Q10 net income of Rp928bn (+18.9%yoy, -5.4%qoq). This result is inline with our and consensus FY10F estimate

􀂄 Lower QoQ performance was due to high base seasonality effect in 4Q09, while yoy improvement was due to the effect of full consolidation of distribution arm.

􀂄 We expect company’s performance in the rest quarters in 2010 will be more or less the same with 1Q10 as ASP increase is limited due to strong competition.

􀂄 We have Buy recommendation on GGRM which currently is trading at PER10-11F of 13.3-11.7x.