NISP Astra Agro Lestari expects a flat growth in revenue (AALI, Rp20,000)

• AAL expects its 2010F revenue to come at around its 2009’s at Rp7.42tn. The company explained that higher CPO price will help AAL’s performance despite its sales volume is expected to come slightly lower at 1mn tons (-0.1% YoY).

• AAL added that its current action in replanting its estate will improve its harvest despite the impact is not imminent. The company plans to spend Rp1.40tn this year to replant almost 10% of its total plantation.

• We view that AAL’s solid net cash position will enable the company to flexibly nurture its estates and to easily obtain loans should it aims for an expansion.

• AALI is trading at 2011F PER of 16.0x and EV/EBITDA of 8.6x.