Semen Indonesia (Persero) (SMGR IJ) - Looking to Brighter Future
- SMGR showed promising 3Q20 results in which net income reached IDR 929 bn (+13.7% YoY, +460% QoQ)
- Revenue was recorded at
IDR 9.6 Tn (-18.5% YoY, +28.9% QoQ) on the back of higher quarterly ASP (+5%
QoQ) and sales volume (+24% QoQ), though on yearly basis the figures are still
down slightly.
- Overall 9M20 revenue was down 9% YoY as cumulative sales volume and ASP were down by 2.9% YoY and 4.1% YoY respectively.
- Nevertheless, 9M20 COGS/ton dropped by 8.8% YoY and Opex/ton fell by 3.2% YoY. widening GPM to 32.1% and OPM to 15.3%.
- 2020E industry volume is projected to be in line with our forecast of 9% to 11% YoY decline.
-In 2021, we forecast cement consumption to grow 4% on the back of economic recovery and higher demand from infrastructure projects.
-We maintained our BUY
recommendation on SMGR, with target price of IDR 15,000, which implies 12.4x
FY21F EV/EBITDA and 28.8x FY21F P/E.
Downside risks to our call
include higher than predicted energy prices, lower sales volume and ASP
Research Department
Atria @Sudirman Level 23B
Jl. Jend. Sudirman Kav. 33A, 10220 Jakarta
Ph: (62 21) 57900 800
Email: research@phillip.co.id
Website: www.poems.co.id
