We reiterate our buy call on Bank Negara Indonesia (BNI)for four reasons (1)improved profitability (2)better asset quality (3)stronger management team and (4)cheap valuation.Furthermore,what has been less appreciated from this bank,in our view,is its strong determination to improve asset quality through better organization structure.
BNI ’s ROAE improved from 7.3%in 2008 to 20.3%in 1H10,supported by strong loan growth and improvement in CASA proportion.
Even though NPL from the medium segment will remain a challenge,we noticed management ’s serious efforts to deal with this issue by reducing loan growth and tightening monitoring practices.In addition to that,it is also worth to see the bank ’ s improved loan yield and coverage ratio.This should help cushion the negative impact from further deterioration on its asset quality,in our view.
The new addition to the BOD is expected to strengthen the bank ’s performance going forward.Two of the new BOD members were tapped from outside the bank (Honggo Widjojo Kangmasto and Darmadi Sutanto), while the remaining two are from inside the state-owned lender (Sutanto and Adi Setianto).In addition,the bank also introduced new role in its organization called Chief Business Risk Officer (CBRO)who will deal with business risks (related to loans)and loan remedial and recovery.
At the current price,BNI is trading at 2011F P/BV of 1.8x and PER of 8.6x,far below the averages of banks under our coverage of 2.7x and 11.6x, respectively.We still believe such discount is unwarranted for the bank; hence our buy call on the counter remains.
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Selasa, 10 Agustus 2010
Sabtu, 31 Juli 2010
Mandiri Sekuritas Medco Energi: 1H10 net profit up 26.2% yoy, inline with expectation (MEDC, Rp3,050, Buy, TP: Rp3,500)
MEDC’s 1H10 revenue grew 27.7% yoy to US$397mn, due to the increasing hydrocarbon lifting and sales by 3.6% yoy to 55.49mboepd and strengthening average realized selling price of crude oil by 46.7% yoy (to US$80.5/bbl), as well as gas price by 15.6% yoy (to US$3.6/mmbtu). This also resulted into better margins. 1H10 revenue reflects around 55.7% of our estimates and 40.8% of consensus’, which is inline with our expectation. MEDC is currently trading at EV/2P reserves of US$3.8/boe.
Mandiri Sekuritas Hexindo Adiperkasa: 1Q10 net income is in line with ours and consensus (HEXA, Rp5,950, Buy, TP: Rp3,600)
On AGM held yesterday, the company decided to disburse dividend amounting to USD12.2mn (35.8% of FY09 net income) or equal to US$0.0145/share or around Rp130.5 (rate Rp9,000/US$); it reflects dividend yield of 2.2%. HEXA booked FY09 net income of US$34.0mn.
The company booked 1Q10 revenues (Apr-Jun’10) of US$123.5mn (+132.3%yoy), a major portion of which was derived from the sale of heavy machineries amounting US$82mn (66.4% of total sales). Meanwhile net income was at US$9.2mn.
We have a Buy recommendation on HEXA; it trades at PER10F of 14.1x.
The company booked 1Q10 revenues (Apr-Jun’10) of US$123.5mn (+132.3%yoy), a major portion of which was derived from the sale of heavy machineries amounting US$82mn (66.4% of total sales). Meanwhile net income was at US$9.2mn.
We have a Buy recommendation on HEXA; it trades at PER10F of 14.1x.
Rabu, 28 Juli 2010
Mansek Bank Negara Indonesia:1H10 results in line with our expectation and consensus estimates (BBNI,Rp2,975,Buy,TP: Rp3,500)
BNI reported net profit of Rp1.9 tn for 1H10 (+60.9%yoy),in line with our expectation and consensus estimates.
The bank recorded higher than expected provisioning expenses in 2Q09 despite lower NPL during the quarter.According to the management,the allocation was intended to increase the bank ’s coverage ratio.At end Jun10,coverage ratio recorded at 122.5%in Jun10 from 121.8%in Mar10.
Meanwhile,loans was quite strong at 9.1%qoq in 2Q10 (-4.3%qoq in 1Q10),bringing LDR to increase to 68.2%at end Jun10 from 67.7%at end Mar10.Consumer loans posted the highest growth of 16.9%qoq to Rp20.5tn,representing 16.2%of total loans at end Jun10.
At current price,BNI is trading at 2011F P/BV of 1.8x and PER of 8.2x,respectively..We maintained our buy recommendation.
The bank recorded higher than expected provisioning expenses in 2Q09 despite lower NPL during the quarter.According to the management,the allocation was intended to increase the bank ’s coverage ratio.At end Jun10,coverage ratio recorded at 122.5%in Jun10 from 121.8%in Mar10.
Meanwhile,loans was quite strong at 9.1%qoq in 2Q10 (-4.3%qoq in 1Q10),bringing LDR to increase to 68.2%at end Jun10 from 67.7%at end Mar10.Consumer loans posted the highest growth of 16.9%qoq to Rp20.5tn,representing 16.2%of total loans at end Jun10.
At current price,BNI is trading at 2011F P/BV of 1.8x and PER of 8.2x,respectively..We maintained our buy recommendation.
Minggu, 02 Mei 2010
Mandiri Sekuritas Timah: 1Q10 net income was below our and consensus estimates (TINS, Rp2,675, Buy, TP: Rp3,000)
Timah posted 1Q10 net income of Rp142bn (+885%yoy, -0.7%qoq). This figure is below our and consensus estimate (12% of FY10F).
YoY improvement was mainly due to rising ASP by 56%yoy while sales volume declined by 11%yoy.
QoQ sales declined by 24%yoy as the company can not fulfilled sales order in 1Q10. However, the sales order will be fulfilled in 2Q10, so that we expect earnings jump in 2Q10. The size of the pending sales order is around 25% of 1Q10 actual sales.
In term of profitability margin, the qoq improvement was not as high as our and consensus expectation as monsoon was longer than expected so that offshore mining contributed less than expected. Rupiah appreciation also hurt the company as its sales are 95% exports, and it has net monetary assets in US$. However, our economist estimate that Rupiah appreciation is very limited at current price, therefore, further deterioration due to forex loss is small.
We expect improvement in the rest quarters. We still maintain our Buy recommendation on TINS which currently is trading at PER10-11F of 11.7x-7.8x.
YoY improvement was mainly due to rising ASP by 56%yoy while sales volume declined by 11%yoy.
QoQ sales declined by 24%yoy as the company can not fulfilled sales order in 1Q10. However, the sales order will be fulfilled in 2Q10, so that we expect earnings jump in 2Q10. The size of the pending sales order is around 25% of 1Q10 actual sales.
In term of profitability margin, the qoq improvement was not as high as our and consensus expectation as monsoon was longer than expected so that offshore mining contributed less than expected. Rupiah appreciation also hurt the company as its sales are 95% exports, and it has net monetary assets in US$. However, our economist estimate that Rupiah appreciation is very limited at current price, therefore, further deterioration due to forex loss is small.
We expect improvement in the rest quarters. We still maintain our Buy recommendation on TINS which currently is trading at PER10-11F of 11.7x-7.8x.
Mandiri Sekuritas INDF: 1Q10 net income at Rp632bn, above ours and consensus estimates (INDF, Rp3,825, Neutral, TP: Rp3,700)
INDF posted 1Q10 net income of Rp632bn (+472.3%yoy, +26.4%qoq), above ours and consensus estimates.
Sales growth of 4.8%yoy and 4.2% qoq was magnified by margin improvement and forex loss reversal.
We still have Neutral recommendation on INDF which currently is trading at PER10-11F of 18.5-16.8x.
Sales growth of 4.8%yoy and 4.2% qoq was magnified by margin improvement and forex loss reversal.
We still have Neutral recommendation on INDF which currently is trading at PER10-11F of 18.5-16.8x.
Kamis, 01 April 2010
Mandiri Sekuritas Timah: FY09 net income is inline with our estimate, but 9% above consensus (TINS, Rp2,400/share, Buy, TP: Rp3,000/share)
Timah posted FY09 revenues of Rp7.7tn (-14.8%yoy, +9.0%qoq) and net income of Rp314bn (-76.6%yoy, +11.4%qoq), which is in line with our estimate, but 9% above consensus.
YoY worsening performance was mainly due to lower ASP by 26%, qoq better performance was also due to better ASP of 3%. The company has not given any operational details.
Company’s performance is highly depends on ASP and tin ore mix between offshore and onshore mining. We expect the company to be able to maintain equal mix between offshore and onshore mining. With 1Q10 tin price up by 11%qoq, we expect the company to continue its strong profitability growth.
We still maintain Buy recommendation for TINS which is currently trading at PER10-11F of 9.6x-6.2.
YoY worsening performance was mainly due to lower ASP by 26%, qoq better performance was also due to better ASP of 3%. The company has not given any operational details.
Company’s performance is highly depends on ASP and tin ore mix between offshore and onshore mining. We expect the company to be able to maintain equal mix between offshore and onshore mining. With 1Q10 tin price up by 11%qoq, we expect the company to continue its strong profitability growth.
We still maintain Buy recommendation for TINS which is currently trading at PER10-11F of 9.6x-6.2.
Rabu, 24 Maret 2010
Mandiri Sekuritas Indofood Sukses Makmur: FY09 earnings above our and consensus estimates (INDF, Rp4,100, Neutral, TP: Rp3,700)
Indofood registered Rp37.1tn sales (-4.3% yoy, -10.5%qoq) and Rp2.1tn earnings (+100.7%yoy, -35.6%qoq) in FY09. We view that sales figure was backed by stronger sales volume growth of its CBP products. CBP division contributed some 43% of sales in FY09, up from 31% in FY08. Noted that this earnings figure is 17-20% above our and consensus estimates largely due to minority interest factor.
As we already mention in our 9M09 report (“Passed its peak”), we think that company’s margin is already peaked in 3Q09. In 4Q09, INDF reported lower gross margin of 26.9%, from 28.6% in the previous quarter, largely due to higher wheat and CPO prices. Wheat and CPO prices have climbed by around 12% and 16% in 4Q09, respectively. For FY09, company booked some forex gain of Rp731bn.
Currently, Indofood is trading at PER10F of 19.8x. Maintain Neutral.
As we already mention in our 9M09 report (“Passed its peak”), we think that company’s margin is already peaked in 3Q09. In 4Q09, INDF reported lower gross margin of 26.9%, from 28.6% in the previous quarter, largely due to higher wheat and CPO prices. Wheat and CPO prices have climbed by around 12% and 16% in 4Q09, respectively. For FY09, company booked some forex gain of Rp731bn.
Currently, Indofood is trading at PER10F of 19.8x. Maintain Neutral.
Mandiri Sekuritas Sampoerna Agro: FY09 earnings of Rp282bn, in line with our estimates (SGRO, Rp2,650, Buy, TP: Rp3,200)
Sampoerna Agro (SGRO) delivered FY09 revenue and earnings of Rp1.8tn and Rp282bn, down by 20.7% and 35.9% respectively. Bottom figure is in line with our and consensus expectations. Production number has yet to be disclosed, but we estimate CPO production in 4Q09 was around 90-95k tons which bring total cumulative production of 270-275k tons, slightly above our estimates.
However, we highlighted that company manage to book lower-than-expected cost and therefore the operating margin decline is relatively small on yearly basis (-5.2% yoy). Noted that lower net margin (15.5% in FY09 vs 19.2% in FY08) was largely due to Rp20bn forex loss.
We maintain our Buy recommendation on the counter with TP of Rp3,200/share.Currently, the stock is trading at PER10F of 11.3x.
However, we highlighted that company manage to book lower-than-expected cost and therefore the operating margin decline is relatively small on yearly basis (-5.2% yoy). Noted that lower net margin (15.5% in FY09 vs 19.2% in FY08) was largely due to Rp20bn forex loss.
We maintain our Buy recommendation on the counter with TP of Rp3,200/share.Currently, the stock is trading at PER10F of 11.3x.
Kamis, 25 Juni 2009
Mandiri Sekuritas Medco Energi: LNG buyer give more time to the consortium (Rp2,750, Neutral, TP: Rp3,700)
Quoting from Bisnis Indonesia, Chubu Electric Power Co and Kansai Electric Power Co (which act as a buyer for LNG) have agreed to give more time for MEDC and Pertamina consortium to further negotiate with the government, in regards to supply gas to DSLNG. The Japanese buyer did not give the exact deadline for the negotiation process.
MEDC believes that there are 3 reasons why the government should agree with the consortium in supplying its gas to DSLNG; 1) the upstream scheme will give out optimum income for the government, 2) around 17% (or 70 mmscfd) of its total production will be allocated to fertilizer plant in Indonesia, and 3) a decent gas selling price of around US$6.2/mmbtu at US$70 oil price and LNG price of around
US$10.9/mmbtu.
Apart from that, PLN’s Planning and Technology Director announced that they have not agreed the selling price of geothermal with MEDC yet. Previously there was news which stated that PT Perusahaan Listrik Negara has agreed the selling price of geothermal power plant in Sarulla of US$6 cents per kWH (30% upward adjustment from previously US$4.6 cents). As MEDC is currently still in a negotiation process with
PLN, we therefore have not factored in future income from this project in our forecast. Thus project realization will provide an upside to our current valuation.
The construction will be in 3 phases over the next 5 years, and the project will start up 2012. Assuming the plant running at its full capacity of 330MW thus, MEDC may obtain an extra income of around US$170mn per year. The company announced that they will out dividend around US$50mn or Rp157/share (assuming Rp10,500/US$). It reflects a divided yield of 5.7%. MEDC is currently trading at EV/2P of US$1.9/boe,
including its contingent reserves.
MEDC believes that there are 3 reasons why the government should agree with the consortium in supplying its gas to DSLNG; 1) the upstream scheme will give out optimum income for the government, 2) around 17% (or 70 mmscfd) of its total production will be allocated to fertilizer plant in Indonesia, and 3) a decent gas selling price of around US$6.2/mmbtu at US$70 oil price and LNG price of around
US$10.9/mmbtu.
Apart from that, PLN’s Planning and Technology Director announced that they have not agreed the selling price of geothermal with MEDC yet. Previously there was news which stated that PT Perusahaan Listrik Negara has agreed the selling price of geothermal power plant in Sarulla of US$6 cents per kWH (30% upward adjustment from previously US$4.6 cents). As MEDC is currently still in a negotiation process with
PLN, we therefore have not factored in future income from this project in our forecast. Thus project realization will provide an upside to our current valuation.
The construction will be in 3 phases over the next 5 years, and the project will start up 2012. Assuming the plant running at its full capacity of 330MW thus, MEDC may obtain an extra income of around US$170mn per year. The company announced that they will out dividend around US$50mn or Rp157/share (assuming Rp10,500/US$). It reflects a divided yield of 5.7%. MEDC is currently trading at EV/2P of US$1.9/boe,
including its contingent reserves.
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