Mansek Indotambang :1H10 net income 46.8%of our FY10F,and 41.7%of consensus (ITMG, Rp38,800,Neutral,TP: Rp34,920)

1H10 achievements was 46.8%of our FY10 net income estimate.Despite stronger operating margin in 2Q10 (25.6%)Vs 1Q10 of 22.9%,derivative losses of US$13.4mn eased the gain,with 2Q net income equally match the achievement of 1Q10.ITMG has contracted 18.4Mt of their coal,with revenue of US$1.34bn and ASP of 72.8/ton.Another 14%is contracted priced to index-linked,and 6%spot.The contracted volume was 81%of our forecast and 82.7%of nominal value.Our FY10 volume assumption is 22.7Mt with ASP of US$71.7/ton.At Rp38,800,ITMG is trading at 16.4x,and 13.6x PER10F and PER11F,respectively,with EV/EBITDA10F and 11F of 8.7x and 7.0x respectively.

Mandiri Sekuritas Indotambang : 1Q10 within ours and consensus (ITMG, Rp35,450, Neutral, TP:Rp34,920)

Net income was 21.7% below Bloomberg consensus. However it is understandable as average coal price they obtained in 1Q10 of US$66.6/ton was in the low range of its US$65-70/ton. Its sales volume was ahead with 26% of its 23Mt sales target. As coal price is trending up, we expect ITMG to achieve and possibly surpass our FY10 estimate. We are keeping our forecasts. We have a Neutral recommendation. At Rp36,450, ITMG is traded at PER10F and PER11F of 15.4x and 12.8x, respectively with EV/EBITDA FY10F and FY11F of 81.x and 6.5x , respectively.