NISP Astra International’s net income surges by 60.7% YoY in 1Q10 (ASII, Rp46,100, Buy)

• During 1Q10 Astra managed to post significant performance where net income grew by 60.7% YoY to Rp3.0tn as compared to Rp1.9tn in 1Q09. The results came in at 23.8% of our full year expectation for 2010F and 25.4% of the consensus.

• Such strong growth was driven by 37.8% YoY growth on revenue to Rp29.7tn from Rp21.5tn, as all of the company’s business units posted strong growth during 1Q10 compared to a year earlier.

• This was also added by higher contribution from share of associates’ results and jointly controlled entities that leapt by 172.7% YoY to Rp1.1tn on significantly higher contribution from automotive companies such as Astra Honda Motor, Toyota Astra Motor and Astra Daihatsu Motor, which contributes Rp918bn of share of results compared to Rp309bn in 1Q09.

• However, the company’s margin decreased slightly during 1Q10 as stronger Rupiah affect several Astra’s subsidiaries.

• Overall, the results managed to meet the expectation and with current valuation of 2010F PER of 14.8x and EV/EBITDA of 11.8x, we still maintain buy.