Banks: SOE banks management movers
New faces at Mandiri and BNI management appointments suggest they are the respective CEO’s dream team. BRI EGM is coming this tomorrow: Expectations are that the CEO will stay.
Mandiri is looking more interesting now with a solid management team, but we think upside is limited until the rights issue overhang settles. One of BNI new BoD Darmadi Sutanto (ex Standard Chartered private banking head, famous for building StanChart wealth on wealth), positive for BNI deposit franchise. We think BNI (Not Rated) is worth a look, trading at 1.7x 2010e PB vs BRI at 3.0x and Mandiri at 2.8x.
PGAS (Buy PT 5,500): Price positive, volume negative
VP Boediono comment that domestic gas price is still far lower than foreign gas price of US$11/ mmbtu and gradually domestic price should rise. Even if public has to bear the eventual cost increase, a gas based economy will benefit everyone more than an oil based economy.
Separately, Hess (Jambi Merang field) signed a 9yr 35mmscfd gas contracts with South Sumatra and Batam local government starting 2011.
Government is likely to let PGAS increase gas price in the future to maintain absolute margin (higher gas cost). We had mentioned Jambi Merang as one of the 6 fields that PGAS may sign a gas contract with. Although it is only 35mmscfd (versus PGAS total distribution volume 2010E at 955mmscfd), it is still a disappointment.
Delta Dunia (DOID Not Rated): May cancel Berau Energy acquisition
Bisnis Indonesia quotes an unnamed executive as saying that DOID has failed to reach an agreement (on pricing) with Recapital Investment Group for the planned Mandatory Exchangeable Bonds (MEB) transaction, which ultimately will pave the way for DOID to own Berau Coal. Consequently, DOID's US$1.1 bn rights issue plan will also be cancelled. DOID is 40/60 owned by Northstar Tambang Persada and public.
We guess that the Northstar people might be getting cold feet at the prospect of becoming even more entangled with the Bakrie group: If the transaction were to go through, they would lose their controlling position to the group. The latest market development above might improve sentiment towards DOID, which is currently trading at 6.8x 2010 and 5.5x 2011 consensus PE, with projected EPS CAGR of 21% in 2010-12. However, we wonder how secure their Bakrie-owned Berau coal contracts are, should the marriage with the Bakries not be consummated.
Astra Agro Lestari (AALI Buy PT 34,000): 2009 dividend and 2010 capex
AALI is distributing 65% of its 2009 net profit in cash dividend, amounting to Rp685 per share. The final dividend of Rp465 per share (yield = 2.3%) will be distributed on June 25, 2010. AALI is allocating Rp1.2 tn for 2010 capex, fully funded through internal cash, which will be used for new planting (4,000 ha), 2 new palm oil mills in Kalimantan and Sulawesi (totalling Rp200 bn) and 4 CPO storage facilities (totalling Rp128 bn).
AALI's 2010 new planting is 70% lower vs. 2009's figure of 13,000 ha. It appears to us that new land bank acquisitions (along with the licenses), in Kalimantan and Sulawesi, are challenging. Please note that the average age of AALI plantation is at 14 years, which is at the peak of palm oil tree's productivity. Unless AALI is able to do more aggressive planting plan, the production outlook is looking weak. YTD, CPO price averages US$810, which is 28% higher relative to the same period last year. AALI is trading at 10.9x 2010 and 7.7x 2011 PE, with projeted 3 -yr EPS CAGR of 35%. We prefer London Sumatra (LSIP Buy PT 13,500), amid its productivity and profitability upside.
Bakrieland Development (ELTY Neutral PT 305): Rights issue plan and 2009 dividend
ELTY president, Hiramsyah Thaib states that ELTY is considering Rp1 tn rights issue in June 2010 and planning to submit the proposal to Bapepam on May 21, 2010. The rights issue proceeds will be used for JVs with Sentul City (BKSL Not Rated) and Kawasan Bukit Jonggol (owned by Lippo Group) in developing and operating the townships in South Jakarta. Meanwhile, ELTY is distributing 15.1% of its 2009 net profit in cash dividend, amounting to Rp1 per share (yield = 0.5%).
This is the first time in ELTY history in paying out dividend since its public listing in 1995. ELTY is currently trading at 31% discount to 2010 NAV of Rp306.
Cement: National April sale +12% YoY to 3.2mt
This is in line with UBSe of 12% demand growth pa for 2010-12. Johannes is turning more bullish in a big cement report published this week.
Preferred pick Semen Gresik. Note that 80% of cement demand comes from property sector. Gresik has been underperforming the cement sector and benefit from MSCI reweighting, which our quant analyst estimates represents passive flow of US$59mn or volume of 7.2 days trading days. Let us know if you’d like the 35pp report.
Kalbe Farma (KLBF Buy PT 2,350): Potential Rp1 tn bonds issuance
In line with plans to expand operations in Southeast Asia, Kalbe Farma is currently negotiating with at least six pharmacy and food producers. Half of these acquisitions will be funded by internal cash while the remaining amount will come from either bonds issuance or bank loan. The company’s cash stands at about Rp1 tn as of Mar 31, indicating the possibility of a Rp1 tn external funding to carry out expansion plans.
Kalbe seems to be embarking on an aggressive acquisition hunt. A good strategy in increasing the company’s presence in regional markets if it can find strong, fairly valued targets that will create synergies.
Tampilkan postingan dengan label Sector and Company News. Tampilkan semua postingan
Tampilkan postingan dengan label Sector and Company News. Tampilkan semua postingan
Minggu, 23 Mei 2010
UBS Sector and Company News
Bumi Resources (BUMI Buy PT 3,200): Non-coal asset to be listed in September
Bisnis Indonesia quotes an unnamed exec as saying that BUMI is planning to raise US$600 mn in September through 25-30% public offering of Bumi Resources Mineral (BRM), the non-coal subsidiary. BUMI will also launch a pre-emptive rights issue to facilitate the entry of China Investment Corporation (CIC) into BUMI. The executive says that CIC is expected to acquire a stake of US$250 mn in BRM.
There’s a lot that must fall into place at BUMI, and CIC would seem to hold a strong hand in negotiations. Despite this, the valuations are compelling (BUMI is trading at 12.8x 2010 and 7.0x 2011 PE, with 3-yr projected EPS CAGR of 60%) and we have not included BRM in our BUMI valuation. The potential credit rating downgrade by Moody's and increased volatility in the global commodity prices may provide a great buying opportunity for the strong stomached.
Bank Mandiri (BMRI Buy PT6,150): Entering the growth phase
In the AGM yesterday, president director Agus Martowardojo has been given the mandate to continue his leadership in the bank. Over the next five years, BMRI will be pursuing three pronged strategy: wholesale banking transaction, retail payment banking and high yield lending, with a view to achieving its target to be one of the top five largest banks in ASEAN by 2014. Meanwhile, BMRI is distributing Rp119 dividend per share (DPR = 35%, Div. yield = 2.2%) for 2009, with a final dividend of Rp100 (yield = 1.9%).
MrAgus mantains his leadership along with his team - positive for the bank to continue its transformation. BMRI is trading at 2.8x 2010 and 2.3x 2011 PBV with projected 3-yr ROE of 24.1%.
Ciputra Development (CTRA Buy PT 1,160): CTRA plans for a stock split
CTRA is holding its AGM today, and the management will propose 1:2 stock split. Meanwhile, CTRA will allocate Rp1.5 tn for 2010 capex, fully funded through commpany's internal cash. CTRA projects are: 1) Ciputra World Jakarta; 2) Ciputra World Surabaya; 3) Citra Raya Hospital; and 4) Grand Shenyang, China.
CTRA is trading at 30% discount to its 2011 NAV of Rp1,156.
Delta Dunia (DOID Not Rated): YTD operational performance
DOID's YTD coal delivery stands at 10.7 mn tons (+4.9% YoY) with 84.1 bcm (flat YoY). During the period, the stripping ratio averaged 7.9 (vs. 8.3 in the same period last year).
Annualising these numbers suggest that DOID is behind full year targets, but management claims that they will catch up in the second half of the year. The slight decline in the stripping ratio is a slightly negative development. DOID is currently trading at 6.6x 2010 and 5.3x 2011 consensus PE, with EPS CAGR of 21% in 2010-12.
Bisnis Indonesia quotes an unnamed exec as saying that BUMI is planning to raise US$600 mn in September through 25-30% public offering of Bumi Resources Mineral (BRM), the non-coal subsidiary. BUMI will also launch a pre-emptive rights issue to facilitate the entry of China Investment Corporation (CIC) into BUMI. The executive says that CIC is expected to acquire a stake of US$250 mn in BRM.
There’s a lot that must fall into place at BUMI, and CIC would seem to hold a strong hand in negotiations. Despite this, the valuations are compelling (BUMI is trading at 12.8x 2010 and 7.0x 2011 PE, with 3-yr projected EPS CAGR of 60%) and we have not included BRM in our BUMI valuation. The potential credit rating downgrade by Moody's and increased volatility in the global commodity prices may provide a great buying opportunity for the strong stomached.
Bank Mandiri (BMRI Buy PT6,150): Entering the growth phase
In the AGM yesterday, president director Agus Martowardojo has been given the mandate to continue his leadership in the bank. Over the next five years, BMRI will be pursuing three pronged strategy: wholesale banking transaction, retail payment banking and high yield lending, with a view to achieving its target to be one of the top five largest banks in ASEAN by 2014. Meanwhile, BMRI is distributing Rp119 dividend per share (DPR = 35%, Div. yield = 2.2%) for 2009, with a final dividend of Rp100 (yield = 1.9%).
MrAgus mantains his leadership along with his team - positive for the bank to continue its transformation. BMRI is trading at 2.8x 2010 and 2.3x 2011 PBV with projected 3-yr ROE of 24.1%.
Ciputra Development (CTRA Buy PT 1,160): CTRA plans for a stock split
CTRA is holding its AGM today, and the management will propose 1:2 stock split. Meanwhile, CTRA will allocate Rp1.5 tn for 2010 capex, fully funded through commpany's internal cash. CTRA projects are: 1) Ciputra World Jakarta; 2) Ciputra World Surabaya; 3) Citra Raya Hospital; and 4) Grand Shenyang, China.
CTRA is trading at 30% discount to its 2011 NAV of Rp1,156.
Delta Dunia (DOID Not Rated): YTD operational performance
DOID's YTD coal delivery stands at 10.7 mn tons (+4.9% YoY) with 84.1 bcm (flat YoY). During the period, the stripping ratio averaged 7.9 (vs. 8.3 in the same period last year).
Annualising these numbers suggest that DOID is behind full year targets, but management claims that they will catch up in the second half of the year. The slight decline in the stripping ratio is a slightly negative development. DOID is currently trading at 6.6x 2010 and 5.3x 2011 consensus PE, with EPS CAGR of 21% in 2010-12.
Kamis, 13 Mei 2010
UBS Sector and Company News
Automotive Sector: Auto tax increase in Jakarta
Jakarta government is raising vehicle tax (to 10% from 5%) and vehicle registration tax (to 20% from 10%) beginning June 1, 2010.
Sales comment: The revised tax rates will effectively cause 15% increase in vehicle prices in the Jakarta area. Jakarta’s 4W and 2W sales account for 25-30% and 20-25% of the industry’s sales volume. This will have negative consequences on Astra International (ASII Under Review) – our quick take is for a 15% downgrade in the auto sales volume assumptions.
Indocement Tunggal (INTP Under Review): 2009 dividend and 2010 expansion
INTP is increasing 2010 capex allocation to US$100 mn, from US$70 mn previously. The aforesaid capex will be partly used to build a cement mills in Cirebon, West Java, with annual capacity of 1.5 tons – targeted to be in full operations by May 2010. INTP also plans to build two more cement mills in Citeureup, West Java with capacity of 2.0 tpa – targeted to be in operations by 2012. Meanwhile, INTP is distributing 30% of its 2009 profits in cash dividend, amounting to Rp225 per share (dividend yield = 1.5%).
Sales comment: Sounds like an aggressive expansion plan to us. INTP’s production capacity will be at 18.6 tpa in 2010, before reaching 20.6 tpa by 2012 – vs. 17.1 tpa currently. But this comes at the expense of lower-than-expected 2009 DPR – we were expecting 50% previously. INTP is trading at 16.5x 2010 and 13.3x 2011 PE, with projected 3-yr EPS CAGR of 23.8%. We would be buying INTP on weakness.
Bank BNI (BBNI Not Rated): AGM today on 2009 dividend and 2010 management line-up
Sales comment: Consensus 2009 dividend projection of Rp236 per share (yield = 9.8%). We believe BBNI CEO Gatot will stay.
Bank Mandiri (BMRI Buy PT 6,150): CEO to stay
Secretary of MSOE Said Didu stated in local papers that Agus Martowardoyo will stay as the nation's largest bank CEO. AGM on May 17, 2010.
Sales comment: SOE banks musical chair will be completed post Bank Rakyat Indonesia (BBRI Buy PT 10,400) AGM on May 2o, 2010.
Indo Tambangraya Megah (ITMG Buy PT 42,800): Q110 result + 2009 dividend
ITMG Q110 net profit stood at US$67 mn (-34% YoY, -4% QoQ), accounting for 20% of UBSe 2010 target of US$344 mn. ITMG 2009 DPR is 46%, amounting to US¢13.8 per share (yield = 3.5%).
Sales comment: ITMG trades at 13.1x 2010 and 9.2x 2011 PE, with 3-yr projected EPS CAGR of 9.2%.
Bakrie Telecom (BTEL Sell PT 110): New companies in Bakrie Group
BTEL has set up Bakrie Network (BNET) with Rp2 bn of equity. BNET will engage in the telecommunication infrastructure business, and is planning to install fiber optic cables along the toll roads owned by the Bakrie Group. BTEL also plans to invest US$100 mn in its subsidiary Bakrie Connectivity (BCON), an Internet and multimedia company.
Jakarta government is raising vehicle tax (to 10% from 5%) and vehicle registration tax (to 20% from 10%) beginning June 1, 2010.
Sales comment: The revised tax rates will effectively cause 15% increase in vehicle prices in the Jakarta area. Jakarta’s 4W and 2W sales account for 25-30% and 20-25% of the industry’s sales volume. This will have negative consequences on Astra International (ASII Under Review) – our quick take is for a 15% downgrade in the auto sales volume assumptions.
Indocement Tunggal (INTP Under Review): 2009 dividend and 2010 expansion
INTP is increasing 2010 capex allocation to US$100 mn, from US$70 mn previously. The aforesaid capex will be partly used to build a cement mills in Cirebon, West Java, with annual capacity of 1.5 tons – targeted to be in full operations by May 2010. INTP also plans to build two more cement mills in Citeureup, West Java with capacity of 2.0 tpa – targeted to be in operations by 2012. Meanwhile, INTP is distributing 30% of its 2009 profits in cash dividend, amounting to Rp225 per share (dividend yield = 1.5%).
Sales comment: Sounds like an aggressive expansion plan to us. INTP’s production capacity will be at 18.6 tpa in 2010, before reaching 20.6 tpa by 2012 – vs. 17.1 tpa currently. But this comes at the expense of lower-than-expected 2009 DPR – we were expecting 50% previously. INTP is trading at 16.5x 2010 and 13.3x 2011 PE, with projected 3-yr EPS CAGR of 23.8%. We would be buying INTP on weakness.
Bank BNI (BBNI Not Rated): AGM today on 2009 dividend and 2010 management line-up
Sales comment: Consensus 2009 dividend projection of Rp236 per share (yield = 9.8%). We believe BBNI CEO Gatot will stay.
Bank Mandiri (BMRI Buy PT 6,150): CEO to stay
Secretary of MSOE Said Didu stated in local papers that Agus Martowardoyo will stay as the nation's largest bank CEO. AGM on May 17, 2010.
Sales comment: SOE banks musical chair will be completed post Bank Rakyat Indonesia (BBRI Buy PT 10,400) AGM on May 2o, 2010.
Indo Tambangraya Megah (ITMG Buy PT 42,800): Q110 result + 2009 dividend
ITMG Q110 net profit stood at US$67 mn (-34% YoY, -4% QoQ), accounting for 20% of UBSe 2010 target of US$344 mn. ITMG 2009 DPR is 46%, amounting to US¢13.8 per share (yield = 3.5%).
Sales comment: ITMG trades at 13.1x 2010 and 9.2x 2011 PE, with 3-yr projected EPS CAGR of 9.2%.
Bakrie Telecom (BTEL Sell PT 110): New companies in Bakrie Group
BTEL has set up Bakrie Network (BNET) with Rp2 bn of equity. BNET will engage in the telecommunication infrastructure business, and is planning to install fiber optic cables along the toll roads owned by the Bakrie Group. BTEL also plans to invest US$100 mn in its subsidiary Bakrie Connectivity (BCON), an Internet and multimedia company.
Selasa, 11 Mei 2010
UBS Sector and Company News
United Tractors (UNTR Sell PT12,100): Management upgrades sales volume target
UNTR is targeting 38-45% YoY growth in Komatsu machinery sales to 4,300-4,500 units in 2010. UNTR is targeting to command 43-45% market share in the Indonesian machinery industry in 2010.
Sales comment: We target UNTR’s Komatsu machinery sales at only 3,800 units for 2010 – vs. Q110 figure at 1,218 units. Assuming 4,400 units in our forecast, we would have to upgrade our EPS by 6%. Risk to our earnings forecast is to the upside. UNTR is trading at 16.4x 2010 and 15x 2011 PE, with 3-yr EPS projection of 9.9%.
Ciputra Development (CTRA Buy PT 1,160): Progress on Ciputra World
CTRA subsidiary Ciputra Property (CTRP, Not Rated) is allocating Rp1.5 tr on capital expenditure for 2010 and 2011. Most of the money will be used to complete the development of the Rp3 tn project, Ciputra World. The company has also appointed contractors to build the upper structure of the superblock. These three contractors are JKON, Tata, and NRC. The mall is expected to be completed in Q112, the apartments and offices in H212, and the hotel in Q412.
Sales comment: Last month, we upgraded CTRA PT by 45% to reflect positive developments at subsidiary companies. In our Apr 13th daily we highlighted, with pictures, that the long delayed Ciputra World development start to take shape.
Indosat (ISAT Neutral Rp6,100): Issuing US$500 mn global bond
ISAT has appointed underwriters to issue a US$500 mn global bond, to be listed in Singapore, for refinancing, working capital and capex.
Sales comment: ISAT’s 2010 net-debt-to-equity is projected at 1.2x. With the bond issue above, ISAT’s 2010 net-debt-to-equity would remain manageable at 1.4x. ISAT is trading at 20.6x 2010 and 19.4x 2011 PE, with unexciting 3-yr EPS CAGR of 7.1%.
UNTR is targeting 38-45% YoY growth in Komatsu machinery sales to 4,300-4,500 units in 2010. UNTR is targeting to command 43-45% market share in the Indonesian machinery industry in 2010.
Sales comment: We target UNTR’s Komatsu machinery sales at only 3,800 units for 2010 – vs. Q110 figure at 1,218 units. Assuming 4,400 units in our forecast, we would have to upgrade our EPS by 6%. Risk to our earnings forecast is to the upside. UNTR is trading at 16.4x 2010 and 15x 2011 PE, with 3-yr EPS projection of 9.9%.
Ciputra Development (CTRA Buy PT 1,160): Progress on Ciputra World
CTRA subsidiary Ciputra Property (CTRP, Not Rated) is allocating Rp1.5 tr on capital expenditure for 2010 and 2011. Most of the money will be used to complete the development of the Rp3 tn project, Ciputra World. The company has also appointed contractors to build the upper structure of the superblock. These three contractors are JKON, Tata, and NRC. The mall is expected to be completed in Q112, the apartments and offices in H212, and the hotel in Q412.
Sales comment: Last month, we upgraded CTRA PT by 45% to reflect positive developments at subsidiary companies. In our Apr 13th daily we highlighted, with pictures, that the long delayed Ciputra World development start to take shape.
Indosat (ISAT Neutral Rp6,100): Issuing US$500 mn global bond
ISAT has appointed underwriters to issue a US$500 mn global bond, to be listed in Singapore, for refinancing, working capital and capex.
Sales comment: ISAT’s 2010 net-debt-to-equity is projected at 1.2x. With the bond issue above, ISAT’s 2010 net-debt-to-equity would remain manageable at 1.4x. ISAT is trading at 20.6x 2010 and 19.4x 2011 PE, with unexciting 3-yr EPS CAGR of 7.1%.
Langganan:
Postingan (Atom)