Mandiri Sekuritas Gudang Garam: 1H10 results are inline with ours and consensus estimate (GGRM, Rp35,100, Neutral, TP: Rp35,000)

􀂄 GGRM posted 1H10 net income of Rp1.8tn (+24%yoy, -8%%qoq), which is inline with ours and consensus estimate.
􀂄 Net profit decline was due to increase in selling expense (World Cup ads) by 104% qoq and yoy. Excluding it, the company performed well on qoq basis.
􀂄 We have Neutral recommendation on GGRM which currently is trading at PER10-11F of 16.9-14.8x.

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.