Mandiri Sekuritas Holcim Indonesia: The government to reevaluate its limestone mining agreement (SMCB, Rp2,150, Neutral, TP: Rp2,500)

Minister of Forestry together with Minister of Law and Human Rights plans to reevaluate Holcim’s limestone mining license in Nusakambangan and Jeruklegi, Cilacap. The government has formed a team to evaluate and analyze the contract. On the other hand, Holcim believes that they have abided the regulation for their exploitation activities. Furthermore, they just utilize the land of only 112 ha from 1,000 ha concession license. Should the government revoke the license, it will have a negative impact to Holcim Indonesia. Currently, SMCB is trading at EV/ton of US$234, which still below than average peers of US$271.