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Indonesia Equity Strategy - Results recap 9M24: picking winners

Indonesia Equity Strategy - Results recap 9M24: picking winners

Macro and Strategy GH JT 344 12th Nov, 2024

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Results recap 9M24: picking winners

We compile Indonesia equities’ 9M24 results and provide a bottom-up assessment of which ones were above/in-line/below Bloomberg consensus estimates. Indeed, our consolidated calculations suggest that 9M24 revenue growth was +5% y-y. Consolidated profit, however, only grew +2% y-y. We continue to favor FMCGs as our sector top pick given solid revenues and net profit growth. For other sectors, we prefer to analyze through the bottom-up appraisal and see how they’ve performed to find value picks.

Revenue and profit recap — margin squeeze/fighting for market share?

Revenues: Sectors that have the highest revenue growth include FMCGs (excluding UNVR IJ [Reduce]), retailers, hospitals, and logistics.

Net profit: Sectors that deliver strong net profit growth include FMCGs, logistics, retailers, and properties. We view that the reason why net profit growth wasn’t as strong as revenue growth is due to companies experiencing margin squeeze or sacrificing margins to win market share.

Given the weak purchasing power in the country, we do not rule out the possibility of a government stimulus for the mid- and low-income segment and thus could provide a potential upside for FMCGs.

Outlook — still weak purchasing power

We view the purchasing power in Indonesia as still weak — and thus may need a booster from the government. Indeed, Indonesia GDP growth in the 3Q24 at 4.95% was below consensus and — lowest since 3Q23 and below the psychological level of 5%.

Stock pick — picking winners

As discussed in our previous anchor report pulse check, we evaluate the country’s purchasing power and conclude that there are areas of both stability and vulnerability. As such, from a stock-picking perspective, we continue to favor winners from each sector through a bottom-up analysis. Our top picks among large caps such as BBCA, AMRT, MYOR, ICBP, HEAL, NCKL (all rated Buy), while for small-mid caps we favor CLEO, ASSA, MIDI (all rated Buy).

Fig. 1: Sectoral topline growth - favouring FMCGs, retailers, healthcare and logistics

Source: Bloomberg Finance L.P., Verdhana research

 

Fig. 2: Sectoral net profit growth - favouring FMCGs, retailers, healthcare and logistics

Source: Bloomberg Finance L.P., Verdhana research

 

Fig. 3: Revenue – per companies and remarks (1 of 2)

Revenue IDR bn2Q233Q232Q243Q24QoQYoY9M239M24YoYRemarks
BBCA        23,372        25,051        26,270        27,8496%11%          73,394          80,52110%In-line
BBRI        40,718        42,931        41,885        44,7047%4%        123,924        131,3386%Above
BMRI        34,694        35,203        37,168        37,1260%5%        102,499        109,3497%In-line
BBNI        13,955        14,218        13,537        16,27920%14%          41,874          43,1233%Below
BTPS          1,325          1,350          1,239          1,219-2%-10%            3,949            3,709-6%Below
PNBN          2,655          2,350          2,780          2,8804%23%            7,634            8,3189%Below
BDMN          4,677          4,833          5,047          5,61011%16%          14,227          15,62410%In-line
BNGA          5,009          4,485          4,453          4,8008%7%          14,481          14,067-3%In-line
BTPN          3,483          3,486          4,819          5,32410%53%          10,318          13,57832%In-line
ARTO              473              419              434              4473%7%            1,343            1,284-4%Below
BRIS          4,760          4,861          5,192          5,83812%20%          14,401          16,11712%In-line
Banks      135,122      139,187      142,823      152,0766%9%        408,043        437,0287%
     
TLKM        37,388        37,760        37,863        36,927-2%-2%        111,238        112,2191%In-line
ISAT        12,730        12,788        14,141        13,836-2%8%          37,462          41,81212%In-line
TOWR          2,912          2,943          3,107          3,2956%12%            8,719            9,4498%In-line
TBIG          1,662          1,673          1,710          1,7130%2%            4,953            5,1274%In-line
MTEL          2,074          2,143          2,244          2,3686%10%            6,273            6,8189%In-line
TMT        56,766        57,307        59,065        58,139-2%1%        168,646        175,4254%
     
ASII        79,413        78,520        78,758        86,36210%10%        240,913        246,3292%In-line
DRMA          1,298          1,505          1,220          1,46720%-3%            4,245            4,022-5%In-line
MPMX          3,309          3,413          3,806          4,1539%22%          10,508          11,84213%Above
SMSM          1,200          1,285          1,194          1,46823%14%            3,764            3,8181%In-line
AUTO          4,409          4,702          4,597          4,9728%6%          14,085          14,1671%In-line
BIRD          1,046          1,137          1,207          1,33611%17%            3,229            3,66413%In-line
WINS              230              310              326              3518%13%                777                96925%In-line
Auto and Transport        90,905        90,872        91,108      100,10910%10%        277,522        284,8113%
     
UNVR          9,687        10,214          8,964          8,373-7%-18%          30,506          27,417-10%Below
MYOR          6,367          8,075          7,462          9,41626%17%          22,894          25,63912%In-line
MLBI              761              769              728              93729%22%            2,270            2,3262%In-line
KLBF          7,310          7,382          7,965          7,910-1%7%          22,561          24,2387%In-line
INDF        25,544        27,802        26,505        29,64712%7%          83,888          86,9444%In-line
ICBP        15,335        16,829        17,039        18,5259%10%          51,307          55,4868%In-line
SIDO              746              708              843              730-13%3%            2,361            2,62711%In-line
ROTI              883          1,014              972          1,0518%4%            2,837            2,9755%Below
ULTJ          1,906          1,979          2,147          2,1380%8%            6,118            6,5838%In-line
CMRY          1,947          1,964          2,247          2,221-1%13%            5,742            6,63716%In-line
CLEO              520              528              670              6812%29%            1,504            1,97832%In-line
KEJU              212              256              268              33224%29%                732                93928%Above
FMCGs        61,531        67,304        66,847        73,59010%9%        202,215        216,3727%
     
ACES          1,933          1,859          2,067          2,056-1%11%            5,494            6,11611%In-line
AMRT        27,667        26,191        29,894        28,998-3%11%          80,025          88,21710%In-line
RALS          1,080              476              837              448-46%-6%            2,140            2,114-1%Below
MAPI          8,132          8,198          9,205          9,6235%17%          23,792          27,61616%In-line
MAPA          3,246          3,614          4,194          4,5338%25%            9,584          12,42030%In-line
LPPF          2,408          1,128          1,780          1,164-35%3%            4,980            4,917-1%In-line
MIDI          4,608          4,276          4,991          4,902-2%15%          12,924          14,68614%In-line
ERAA        14,104        13,919        16,467        15,491-6%11%          42,816          48,60814%In-line
Retailers        63,179        59,660        69,433        67,215-3%13%        181,755        204,69313%
     
GGRM        26,120        25,897        23,754        23,8751%-8%          81,749          73,893-10%In-line
WIIM          1,209          1,339          1,163          1,2104%-10%            3,720            3,431-8%Below
HMSP        29,189        31,142        28,710        30,6517%-2%          87,297          88,4681%In-line
Cigarettes        56,518        58,379        53,627        55,7364%-5%        172,765        165,792-4%
Source: Bloomberg Finance L.P., Verdhana research

 

Fig. 4: Revenue – per companies and remarks (2 of 2)

Revenue IDR bn2Q233Q232Q243Q24QoQYoY9M239M24YoYRemarks
MIKA          1,021          1,108          1,209          1,166-4%5%            3,157            3,61915%In-line
SILO          2,628          2,964          2,990          3,1074%5%            8,246            9,12311%In-line
HEAL          1,339          1,538          1,638          1,6823%9%            4,230            5,02719%In-line
PRDA              545              549              545              5664%3%            1,612            1,598-1%Below
Healthcare          5,533          6,160          6,382          6,5222%6%          17,245          19,36712%
     
BSDE          2,122          2,310          3,572          2,720-24%18%            7,308          10,06738%In-line
CTRA          2,339          2,120          2,721          2,080-24%-2%            6,589            7,1178%In-line
PWON          1,512          1,673          1,731          1,525-12%-9%            4,569            4,7865%Below
Properties          5,973          6,103          8,024          6,325-21%4%          18,467          21,97019%
     
HRUM          2,965          2,321          5,415          5,6554%144%            9,702          15,28758%In-line
ADRO        24,599        23,21124,069        22,390-7%-4%          75,379          69,335-8%Below
PTBA          8,901          8,879        10,233        11,0138%24%          27,738          30,65611%Above
ITMG          9,200          8,152          9,175          9,1750%13%          27,632          26,106-6%Below
INDY        11,490          9,667        10,306          8,894-14%-8%          34,756          28,196-19%Above
ADMR          3,379          3,972          5,445          3,542-35%-11%          10,924          13,34022%In-line
Coal        60,534        56,202        64,644        60,669-6%8%        186,130        182,919-2%
     
INCO          4,435          4,311          4,194          3,482-17%-19%          14,191          11,322-20%In-line
ANTM        10,068          9,238        14,569        20,01237%117%          30,899          43,20140%In-line
Metals        14,502        13,549        18,763        23,49425%73%          45,090          54,52321%
     
ESSA          1,204              996          1,274          1,189-7%19%            3,518            3,6333%Below
MEDC          8,368          8,556          9,579          9,7201%14%          25,292          28,12111%Above
AKRA          8,896        10,123          8,839          9,96213%-2%          29,977          28,612-5%In-line
ELSA          2,717          3,122          3,210          3,3354%7%            8,983            9,6527%In-line
O&G        21,185        22,797        22,902        24,2056%6%          67,770          70,0183%
     
ARNA              566              616              589              70019%14%            1,842            1,9224%In-line
AVIA          1,726          1,656          1,716          1,7844%8%            5,164            5,4055%In-line
IMPC              646              697              690              98142%41%            2,087            2,41516%In-line
SMGR          8,097        10,629          8,036          9,88423%-7%          27,661          26,295-5%In-line
INTP          3,724          4,958          4,041          5,19629%5%          12,928          13,3203%In-line
Building Mat        14,759        18,555        15,072        18,54623%0%          49,681          49,357-1%
     
ASSA          1,243          1,071          1,186          1,2747%19%            3,460            3,6415%Above
ASLC              156              165              198              23619%44%                453                61836%Above
Logistics          1,398          1,236          1,385          1,5109%22%            3,914            4,2609%
     
JSMR          4,478          5,157          7,023          7,2944%41%          14,081          20,36645%In-line
Infra          4,478          5,157          7,023          7,2944%41%          14,081          20,36645%
     
JPFA        12,394        13,612        13,723        13,631-1%0%          37,767          41,2809%In-line
CPIN        16,328        16,237        17,049        16,757-2%3%          47,129          49,7195%In-line
Poultry        28,722        29,848        30,772        30,388-1%2%          84,896          90,9997%
     
TAPG          1,847          2,266          2,165          2,1660%-4%            6,039            6,2423%In-line
LSIP              980          1,039              921          1,12322%8%            2,923            2,9240%In-line
AALI          4,630          6,291          5,513          5,9748%-5%          15,682          16,2874%In-line
DSNG          2,291          2,207          2,473          2,4690%12%            6,564            7,1729%In-line
CPO          9,747        11,803        11,072        11,7316%-1%          31,208          32,6265%
Total      630,853      644,119      668,942      697,5474.3%8.3%    1,929,427    2,030,5265.2%
Source: Bloomberg Finance L.P., Verdhana research

 

Fig. 5: Net profit – growth and remarks per company (1 of 2)

NPAT Rp bn2Q233Q232Q243Q24QoQYoY9M239M24YoYRemarks
BBCA        12,660        12,230        13,997        14,1981%16%            36,420                  41,07413%In-line
BBRI        13,920        14,571        13,816        15,36311%5%            43,993                  45,0652%Below
BMRI        12,672        13,832        13,848        15,46712%12%            39,064                  42,0188%In-line
BBNI          5,081          5,452          6,096          5,617-8%3%            15,753                  17,0398%In-line
BTPS              328              251              288              218-24%-13%              1,004                        771-23%Below
PNBN          1,150              676              589              93058%38%              2,416                     2,206-9%Above
BDMN              690          1,053              624              87741%-17%              2,561                     2,332-9%In-line
BNGA          1,652          1,669          1,726          1,687-2%1%              4,902                     5,0944%Above
BTPN              656              632              697              7548%19%              2,094                     1,994-5%In-line
ARTO                23                10                28                3627%267%                    50                           8671%Below
BRIS          1,364          1,378          2,236          1,713-23%24%              4,200                     5,65635%In-line
Banks        50,195        51,754        53,945        56,8595%10%          152,456                163,3347%
     
TLKM          6,332          6,743          5,708          5,9144%-12%            19,499                  17,675-9%In-line
ISAT              979              879          1,440          1,143-21%30%              2,787                     3,87839%Above
TOWR              807              866              808              8424%-3%              2,426                     2,4471%Above
TBIG              357              430              381              43715%2%              1,118                     1,1674%Below
MTEL              521              408              543              468-14%15%              1,430                     1,5327%Below
TMT          8,996          9,326          8,880          8,804-1%-6%            27,260                  26,700-2%
     
ASII          8,730          8,242          8,392          9,99819%21%            25,691                  25,8541%Above
DRMA              130              174              104              17568%1%                  520                        412-21%In-line
MPMX              133              157              163              114-30%-28%                  422                        4415%In-line
SMSM              208              265              230              27419%3%                  695                        7194%In-line
AUTO              369              510              539              515-4%1%              1,312                     1,52817%Above
BIRD              136              108              147              17318%60%                  367                        43619%Above
WINS                13                27              183                95-48%256%                    43                        313635%Above
Auto and Transport          9,719          9,484          9,758        11,34416%20%            29,049                  29,7052%
     
UNVR          1,354          1,430          1,018              543-47%-62%              4,189                     3,010-28%Below
MYOR              492              807              606              298-51%-63%              2,026                     2,015-1%In-line
MLBI              254              235              239              31833%35%                  693                        76310%In-line
KLBF              673              536              848              573-32%7%              2,065                     2,37815%Below
INDF          1,717          1,517          1,404          4,906249%224%              7,083                     8,76124%Above
ICBP          1,771          1,335          1,186          4,612289%245%              7,060                     8,14915%Above
SIDO              148              138              218              170-22%23%                  587                        77833%In-line
ROTI                70              111                71              10447%-6%                  230                        2498%Below
ULTJ              256              328              350              126-64%-62%                  939                        881-6%Below
CMRY              325              345              416              353-15%3%                  967                     1,15620%In-line
CLEO                70                71              105              11611%63%                  200                        33668%In-line
KEJU                  6                17                31                4752%177%                    61                        125106%Above
FMCGs          5,780          5,440          5,473        11,624112%114%            21,910                  25,59217%
     
ACES              144              183              161              20830%14%                  486                        57418%In-line
AMRT              837              578              904              605-33%5%              2,190                     2,39910%In-line
RALS              216                  8              141                  5-97%-39%                  255                        253-1%Above
MAPI              639              445              485              401-17%-10%              1,475                     1,300-12%Below
MAPA              390              375              305              51568%37%              1,025                     1,1027%Above
LPPF              583-              53              300-                 4-101%-93%                  631                        622-1%In-line
MIDI              142              131              166              142-14%8%                  391                        46720%Above
ERAA              223                36              268              2680%640%                  495                        79160%Above
Retailers          3,174          1,703          2,731          2,139-22%26%              6,947                     7,5078%
     
GGRM          1,325          1,169              330                67-80%-94%              4,457                        992-78%Below
WIIM              136              195                57                606%-69%                  441                        208-53%Below
HMSP          1,590          2,455          1,070          1,90878%-22%              6,205                     5,224-16%In-line
Cigarettes          3,051          3,819          1,456          2,03540%-47%            11,104                     6,424-42%
Source: Bloomberg Finance L.P., Verdhana research

 

Fig. 6: Net profit – growth and remarks per company (2 of 2)

NPAT Rp bn2Q233Q232Q243Q24QoQYoY9M239M24YoYRemarks
MIKA              222              233              312              272-13%17%                  686                        87327%In-line
SILO              254              356              301              3217%-10%                  859                        635-26%In-line
HEAL                93              146              152              125-18%-15%                  349                        46834%In-line
PRDA                77                87                77                793%-9%                  236                        194-18%In-line
Healthcare              647              822              841              797-5%-3%              2,130                     2,1702%
     
BSDE              317              568              896              369-59%-35%              1,769                     2,70253%In-line
CTRA              366              402              546              248-55%-38%              1,181                     1,2778%In-line
PWON              503              388              515              81658%110%              1,487                     1,66312%Below
Properties          1,186          1,359          1,957          1,433-27%5%              4,437                     5,64127%
     
HRUM              713-            670              596              493-17%-174%              1,589                     1,104-30%In-line
ADRO          6,234          5,3336,623          6,119-8%15%            18,435                  18,6771%In-line
PTBA          1,613          1,004          1,242          1,198-4%19%              3,779                     3,230-15%In-line
ITMG          1,863          1,528          1,105                   --100%-100%              6,131                     2,082-66%In-line
INDY              463                62                15              2031282%225%              1,409                        536-62%Above
ADMR          1,181          1,344          2,173          1,275-41%-5%              3,796                     5,28839%In-line
Coal        12,067          8,602        11,753          9,288-21%8%            35,139                  30,918-12%
     
INCO          1,055              812              509              257-49%-68%              4,397                        865-80%Below
ANTM              227              959          1,312              651-50%-32%              2,849                     2,201-23%Above
Metals          1,282          1,771          1,821              908-50%-49%              7,246                     3,066-58%
     
ESSA                13                89              170              19616%120%                  149                        528254%Above
MEDC              561          1,900          2,489              742-70%-61%              3,691                     4,37218%In-line
AKRA              424              679              408              46614%-31%              1,710                     1,469-14%Below
ELSA              135              157              260              108-58%-31%                  407                        55136%Above
O&G          1,133          2,825          3,326          1,513-55%-46%              5,957                     6,92116%
     
ARNA                98              109                98              11315%3%                  353                        316-10%In-line
AVIA              390              334              362              352-3%6%              1,140                     1,1602%In-line
IMPC                92              128              118              13010%2%                  341                        39717%In-line
SMGR              305              848                30              218635%-74%              1,714                        719-58%Below
INTP              327              569              197              621216%9%              1,267                     1,056-17%In-line
Building Mat          1,212          1,987              805          1,43478%-28%              4,815                     3,649-24%
     
ASSA                18                49                57                8447%73%                  118                        21380%Above
ASLC                  3                  7                  9                1676%134%                    11                           40273%Above
Logistics                21                55                66              10051%80%                  129                        25396%
     
JSMR              651              719          1,727              953-45%33%              1,868                     3,30077%Above
Infra              651              719          1,727              953-45%33%              1,868                     3,30077%
     
JPFA              332              855              814              617-24%-28%                  937                     2,096124%Above
CPIN          1,138          1,297          1,057              619-41%-52%              2,676                     2,387-11%In-line
Poultry          1,470          2,152          1,872          1,236-34%-43%              3,613                     4,48324%
     
TAPG              175              634              596              6519%3%              1,103                     1,61747%Above
LSIP                55              291              329              205-38%-30%                  458                        80376%In-line
AALI              143              433              271              30011%-31%                  801                        8010%In-line
DSNG              148              141              278              35729%153%                  503                        86171%In-line
CPO              520          1,499          1,473          1,5133%1%              2,864                     4,08243%
Total     101,104     103,316     107,885     111,9793.8%8.4%          316,923                323,7462.2%
Source: Bloomberg Finance L.P., Verdhana research

 

Fig. 7: 9M24 – topline growth per companies

Source: Bloomberg Finance L.P., Verdhana research

 

Fig. 8: Quarterly – revenue growth by sector breakdown

Source: Bloomberg Finance L.P., Verdhana research

 

Fig. 9: Banks’ interest income growth trend quarterly

Source: Bloomberg Finance L.P., Verdhana research

 

Fig. 10: Telco/tower revenue growth quarterly trend. Strongest include TOWR, MTEL, ISAT

Source: Bloomberg Finance L.P., Verdhana research

 

Fig. 11: Autos/transport revenue growth quarterly trend. Strongest include MPMX, SMSM, BIRD

Source: Bloomberg Finance L.P., Verdhana research

 

Fig. 12: FMCG revenue growth – quarterly trend. Strongest include MYOR, ICBP, CLEO, CMRY

Source: Bloomberg Finance L.P., Verdhana research

 

Fig. 13: Retailers revenue growth – quarterly trend. Strongest growth in MAPA, MIDI, MAPI, AMRT

Source: Bloomberg Finance L.P., Verdhana research

 

Fig. 14: Healthcare revenue growth – quarterly trend

Source: Bloomberg Finance L.P., Verdhana research

 

Fig. 15: Coal and metal mining revenue growth – quarterly trend

Source: Bloomberg Finance L.P., Verdhana research

 

Fig. 16: Properties – revenue growth trend on quarterly basis

Source: Bloomberg Finance L.P., Verdhana research

INVESTMENT RATINGS
A rating of ‘Buy’, indicates that the analyst expects the stock to outperform the Benchmark over the next 12 months. A rating of ‘Neutral’, indicates that the analyst expects the stock to perform in line with the Benchmark over the next 12 months. A rating of ‘Reduce’, indicates that the analyst expects the stock to underperform the Benchmark over the next 12 months. A rating of ‘Suspended’, indicates that the rating, target price, and estimates have been suspended temporarily to comply with applicable regulations and/or firm policies. Securities and/or companies that are labelled as ‘Not Rated’ or ‘No Rating’ are not in regular research coverage. Benchmark is Indonesia Composite Index (‘IDX Composite’). A ‘Target Price’, if discussed, indicates the analyst’s forecast for the share price with a 12-month time horizon, reflecting in part of the analyst’s estimates for the company’s earnings, and may be impeded by general market and macroeconomic trends, and by other risks related to the company or the market in general. 

GENERAL DISCLOSURE/DISCLAIMER 
This report is prepared by PT Verdhana Sekuritas Indonesia (“PTVSI”) a securities company registered in Indonesia, supervised by Indonesia Financial Services Authority (OJK) and a member of the Indonesia Stock Exchange (IDX).

This report is intended for client of PTVSI only and no part of this document may be (i) copied, photocopied or duplicated in any form or by any means or (ii) redistributed without the prior written consent of PTVSI.

The research set out in this report is based on information obtained from sources believed to be reliable, but PTVSI do not make any representation or warranty as to its accuracy, completeness or correctness. The information in this report is subject to change without notice, its accuracy is not guaranteed, it may be incomplete or condensed and it may not contain all material information concerning the company (or companies) referred to in this report. Any information, valuations, opinions, estimates, forecasts, ratings or targets herein constitutes a judgment as of the date of this report is published, and there is no assurance that future results or events will be consistent.


This report is not to be construed as an offer or a solicitation of an offer to buy or sell any securities or financial products. PTVSI and its associates, its directors, and/or its employees may from time to time have interests in the securities mentioned in this report or it may or will engage in any securities transaction or other capital market services for the company (companies) mentioned herein.

ANALYST CERTIFICATION
The research analyst primarily responsible for the content of this report and certifies that the views about the companies including their securities expressed in this report accurately reflect his/her personal views.  The analyst also certifies that no part of his/her compensation was, is, or will be, directly, or indirectly, related to specific recommendations or views expressed in this report.


RESTRICTIONS ON DISTRIBUTION

By accepting this report, the recipient hereof represents and warrants that you are entitled to receive such report in accordance with the restrictions and agrees to be bound by the limitations contained herein. Neither this report nor any copy hereof may be distributed except in compliance with applicable Indonesian capital market laws and regulations. 

Research Analysts

Gerald Hugo (gerald.hugo@verdhana.id) 

Jupriadi Tan (jupriadi.tan@verdhana.id)

Tags: Equity Strategy, Gerald Hugo, Jupriadi Tan
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