INVESTOR DIGEST

Equity Research | 23 October 2019

Economic Data HIGHLIGHT

Latest 2019F
 Cigarette: 2020 Excise — A Tale of Two Halves 
7-DRRR (%), eop 5.25 5.25  Property: New in the Hood — Waking Up as September Ends 
Inflation (YoY %) 3.39 3.41  BTPN Syariah: A Strong Quarter Resulting from Improvement in Productivity (BTPS;
US$ 1 = Rp, period avg 14,038 14,286 Rp3,550; Buy; TP: Rp4,200) 
 Market Recap October 22nd 2019; JCI 6,225.50 Points +26.51 pts (+0.43%); Valued
$457mn; Mkt Cap $492bn; USD/IDR 14,038 
Stock Market Data
(22 October 2019)

JCI Index 6,225.5 0.43%

Trading T/O ( Rp bn )
Market Cap ( Rp tn )
Market Data Summary*
SECTOR
6,463.7 Cigarette: 2020 Excise — A Tale of Two Halves
7,159.8
 Excise tariff hikes for Tier-1 producers were as expected but minimum retail price
increases are higher than media reports, suggesting lesser impact on margin but
more on volume. While lowering our PTs, we keep our Buy ratings as share price
drop has exceeded the potential EPS decline. Sector is attractive on a 2-year view
though volatility could persist within the next one year as volume trend and
2019F 2020F
price increases timing may differ to market expectations.

P/E (x) 16.9 15.7

 A blended 23% tariff increases. Ministry of Finance has released 2020 tobacco
excise tariffs with an increase of 25%/26%/16% for Tier-1 SKM/SPM/SKT, and
P/BV (x) 2.5 2.3
steep adjustment in suggested minimum retail price (HJE) of 52%/60%/16%. This
EV/EBITDA (x) 13.9 13.0
implies a 2-year CAGR of 12% for SKM/SPM and 8% for SKT, in-line with historical
Div. Yield (%) 2.6 2.8
range; hence, concluding 2020 as a new normal is too premature. Nonetheless,
Net Gearing (%) 21.2 20.3
the steep HJE adjustment, since its last in 2017, could mark the government’s
ROE (%) 15.5 15.4
intention to curb volume as producers got around excise adjustments through
EPS Growth (%) 7.6 7.7
creating affordable brands. Despite similar absolute tax per stick, the 3-year
EBITDA Growth (%) 4.6 6.8
hiatus in HJE adjustments have widened retail price gap of premium and
Earnings Yield (%) 5.9 6.4
affordable brands by ~50% (Rp500/stick), hitting blended margins.

* Aggregate of 73 companies in MS research universe,
representing 62.4%of JCI’s market capitalization
 What could be the pass-through scenarios? As new HJE and excise comes into
effect on 1 Jan 2020 (2019 excise ribbons are allowed up to 1 Feb 2020), fully
complying with the HJE rule would require GGRM and HMSP to raise the prices
of affordable brands by 30-38% and 14-35%, more than the required tax pass-
through, implying volume-weighted ex-factory price hikes of 7% and 10%. This
means that the retail price gap of the premium and affordable brands would
almost disappear to <6% from ~50%. Thus, we expect both companies to be
more aggressive in raising prices of affordable brands starting 4Q19 to be in
compliant but at the same time gradual increasing the prices of premium brands
by at least 10-12% for price laddering strategy to work. We expect blended ex-
factory price increases of 4%/14% for GGRM in 2019/2020 and 3%/14% for HMSP.
 What would be the EPS impact? We expect net revenue margin for the
affordable brands to sharply increase by ~2-5ppt for GGRM and ~4ppt for HMSP,
but the overall blended gross margin is expected to decline as overhead costs
will be stickier while we expect 13%/11% volume decline in 2020 for
GGRM/HMSP. We increased 2019 EPS by 2%/8% for GGRM/HMSP but reduced
2020 by 28%/19%, implying 24%/17% EPS growth for 2019 and 22%/23%
decline for 2020.

Please see important disclosure at the back of this report Page 1 of 10

 Equity Research | 23 October 2019

 Buy rating unchanged. GGRM/HMSP share prices have collapsed 33%/30% since words appearing about the steep 2020
excise hike. Learning from regional comparisons, a period of high excise hikes led to a ~20% de-rating in the valuation
band with higher stock price volatility as EPS predictability declines. GGRM/HMSP now trades on 2020 PE of 13x/20x, at
the bottom of the valuation band with HMSP giving a 6% dividend yield. We keep our Buy rating with new PT of
Rp63,450/Rp2,450 for GGRM/HMSP, implying 2021 PE of 11x/21x. Both stocks are attractive on a 2-year view, but volatility
could increase over the next one year as pass-through strategy and timing may differ to market expectations.

2020 EXCISE TARIFF ADJUSTMENTS

Excise Tariff (Rp/stick) Excise Tariff % YoY
Tiers
2016 2017 2018 2019 2020 2017 2018 2019 2020
I 480 530 590 590 740 10.4% 11.3% 0.0% 25.4%
SKM 340 365 385 385 470 7.4% 5.5% 0.0% 22.1%
II
300 335 370 370 455 11.7% 10.4% 0.0% 23.0%
I 495 555 625 625 790 12.1% 12.6% 0.0% 26.4%
SPM 305 330 370 370 485 8.2% 12.1% 0.0% 31.1%
II
255 290 355 355 470 13.7% 22.4% 0.0% 32.4%
320 345 365 365 425 7.8% 5.8% 0.0% 16.4%
I
245 265 290 290 330 8.2% 9.4% 0.0% 13.8%
155 165 6.5%
SKT II 180 180 200 12.5% 0.0% 11.1%
140 155 10.7%
90 100 11.1%
III 100 100 110 11.1% 0.0% 10.0%
80 80 0.0%

Source: Ministry of Finance, Mandiri Sekuritas estimates

2020 SUGGESTED RETAIL PRICE (HJE) ADJUSTMENTS

HJE Tariff (Rp/stick) HJE Tariff (% YoY)
Tiers
2016 2017 2018 2019 2020 2017 2018 2019 2020
I 1,000 1,120 1,120 1,120 1,700 12.0% 0.0% 0.0% 51.8%
SKM 740 820 895 895 1,275 10.8% 9.1% 0.0% 42.5%
II
665 738 805 805 1,148 10.9% 9.2% 0.0% 42.5%
I 930 1,030 1,130 1,130 1,790 10.8% 9.7% 0.0% 58.4%
SPM 800 900 935 935 1,485 12.5% 3.9% 0.0% 58.8%
II
653 743 788 788 1,250 13.8% 6.1% 0.0% 58.7%
1,115 1,215 1,260 1,260 1,460 9.0% 3.7% 0.0% 15.9%
I
945 1,038 1,075 1,075 1,238 9.8% 3.6% 0.0% 15.1%
605 730
SKT II 470 470 535 0.0% 13.8%
518 600
III 400 465 400 400 450 0.0% 12.5%

Source: Ministry of Finance, Mandiri Sekuritas estimates

SUMMARY OF FORECAST CHANGES FOR GGRM

New Old Chg
(Rp bn)
2019F 2020F 2021F 2019F 2020F 2021F 2019F 2020F 2021F
Revenues 106,760 105,037 119,454 106,111 115,508 127,410 0.6% -9.1% -6.2%
Gross profit 21,930 19,071 22,043 21,647 23,692 25,447 1.3% -19.5% -13.4%
EBIT 13,517 10,554 12,448 13,275 14,505 15,342 1.8% -27.2% -18.9%
Pretax profit 12,968 10,103 12,054 12,726 14,031 14,935 1.9% -28.0% -19.3%
Net profit 9,642 7,512 8,963 9,462 10,433 11,105 1.9% -28.0% -19.3%
Margins
Gross margin 20.5% 18.2% 18.5% 20.4% 20.5% 20.0% 0.1% -2.4% -1.5%
EBIT margin 12.7% 10.0% 10.4% 12.5% 12.6% 12.0% 0.2% -2.5% -1.6%
Net margin 9.0% 7.2% 7.5% 8.9% 9.0% 8.7% 0.1% -1.9% -1.2%
Sales volume (bn sticks)
SKM volume 82.9 70.9 72.9 82.4 83.2 84.0 0.6% -14.8% -13.2%
SKT volume 8.4 8.1 8.4 8.4 8.4 8.4 0.3% -2.7% 0.2%
Total volume 91.3 79.0 81.3 90.8 91.5 92.3 0.5% -13.7% -11.9%

Source: Mandiri Sekuritas estimates

Please see important disclosure at the back of this report Page 2 of 10

 Equity Research | 23 October 2019

SUMMARY OF FORECAST CHANGES FOR HMSP

New Old Chg
2019F 2020F 2021F 2019F 2020F 2021F 2019F 2020F 2021F
Revenues 106,160 107,786 122,507 105,952 116,024 129,091 0.2% -7.1% -5.1%
Gross profit 26,719 22,623 25,891 25,023 26,734 30,063 6.8% -15.4% -13.9%
EBIT 19,350 14,360 15,733 17,772 18,269 19,787 8.9% -21.4% -20.5%
Pretax profit 21,181 16,397 17,838 19,603 20,306 21,892 8.0% -19.3% -18.5%
Net profit 15,885 12,297 13,379 14,702 15,230 16,419 8.0% -19.3% -18.5%
Margins
Gross margin 25.2% 21.0% 21.1% 23.6% 23.0% 23.3% 1.6% -2.1% -2.2%
EBIT margin 18.2% 13.3% 12.8% 16.8% 15.7% 15.3% 1.5% -2.4% -2.5%
Volumes
Sales volume (bn sticks) 98.1 87.3 90.3 99.6 100.8 101.9 -1.5% -13.4% -11.4%

Source: Mandiri Sekuritas estimates

Adrian Joezer (+6221 5296 9415) adrian.joezer@mandirisek.co.id

Riyanto Hartanto (+6221 5296 9488) riyanto@mandirisek.co.id
Lakshmi Rowter (+6221 5296 9549) lakshmi.rowter@mandirisek.co.id

Property: New in the Hood — Waking Up as September Ends

 3Q proved to be solid for the sector as more launches hit the market. Following traction of past months, launches in
September continued to do well. As of end-3Q, 4 of 7 developers we track had presales on-track to beat their
management’s full-year targets. We maintain Overweight on the sector on the presales beat.

 Maja running on solid legs. CTRA’s Citra Maja Raya project saw two launches; a residential cluster and a row of
shophouses. Based on our channel checks, both offerings have sold out. ASPs were IDR 220mn/unit for landed houses
and IDR 700mn/unit for shophouses. This is a solid turnout given concerns on the investor life-cycle of the project and
rising competition from surrounding projects, notably a large-scale competing project located five stations prior to the
Maja railway station offered by a listed peer. The solid take-up, in our view, shows that Maja should still have solid legs to
run.

 BSDE’s compact offering sold out. BSDE launched FleekHauz, a small house project on 40-52 sqm of land which utilizes
the tiny dwelling concept, with per unit ASP ranging IDR 861mn-1bn. Take-up was solid and the 290 units offered were
quickly taken-up upon the start of booking orders. The company is planning the next phase encompassing 160 units.
Worth noting is sales activities began around the time of September’s mass demonstrations but nonetheless saw
excellent take-up.

 Surabaya’s high-rise also showed vigor. PWON launched the Bella tower at East Coast Mansion in East Surabaya in late
September, which also saw reasonably strong take-up at 73% 248 of the 341 units offered. ASP ranges from IDR 650mn-
1bn per unit, averaging around IDR 25mn psm. High-rise demand has been shaky of late; such level of take-up is
invigorating.

 4Q traction also looks upbeat. Further into 4Q19, the pipeline seems potent. Across projects already launched, CTRA’s
Citra Garden Puri (ASP IDR 1bn-3bn per unit; most units closer to IDR 1bn), a competing project to BSDE’s FleekHauz, sold
out in early October, offloading some 700 units. The take-up is remarkable given the launch took place close to
Fleekhauz’s commencement. Elsewhere, CTRA’s Delft high-rise in Makassar has also done well at 78% take-up. These have
earned CTRA IDR 1tn in additional presales as of early October. Among others, PWON’s Bekasi apartment (part of the new
mixed-use property) appears on track for a 4Q19 launch; it has just begun accepting booking orders. The project is priced
at IDR 16mn psm (IDR 400mn-700mn/unit), on the more affordable end, lower than blended target ASP for the project.
Based on our checks, traction looks solid for a new offering, at 170 units (target: 200).

Please see important disclosure at the back of this report Page 3 of 10

 Equity Research | 23 October 2019

2019 2019 Bulk

Presales IDRbn 1Q18 1H18 9M18 2018 1Q19 1H19 9M19
Company Mansek sales
CTRA 1,614 3,312 5,147 6,363 1,114 2,405 4,150 6,023 5,931 -
BSDE 2,123 3,774 5,388 6,219 1,557 2,729 5,264 6,200 6,028 816
PWON 605 1,087 1,700 2,203 353 711 1,022 2,200 1,699 -
SMRA 459 1,151 2,222 3,397 1,137 2,227 3,353 4,000 4,094 152
ASRI 1,558 3,061 3,626 4,292 880 1,345 1,815 5,000 2,557 34
JRPT 490 927 1,401 1,944 533 1,030 1,600 2,041 1,851 -
Total 6,849 13,312 19,485 24,418 5,575 10,446 17,204

Source: Company

Robin Sutanto (+6221 5296 9572) robin.sutanto@mandirisek.co.id

CORPORATE

BTPN Syariah: A Strong Quarter Resulting from Improvement in Productivity (BTPS; Rp3,550; Buy; TP: Rp4,200)

 BTPS reported exceptionally strong results in 3Q19, as the bank was able to realize improvement in productivity from the
implementation of tablets, reorganization of sentras, and change in employee incentive scheme. Maintain BUY with
revised TP of Rp4,200 from previously Rp3,150.

 Curbing the trend. Unlike prior years when 3Q was the slowest quarter of the year due to high rundowns, BTPS reported
exceptional results in 3Q19 with strong loan growth of +28% yoy/+4% qoq and bottom line growth of +47% yoy/+14%
qoq to Rp367bn. Management was able to achieve its target of bringing the bank’s cost to income ratio close to 45% in
3Q19 due to three reasons: 1) realizing benefits of equipping loan officers with tablets; 2) reorganization and reallocation
of sentra meetings; 3) decline in loan officer turnover.

 Improving productivity rates. The implementation of tablets during 4Q18 successfully increased the number of
meetings a loan officer can host to 4 meetings per day from previously 2-3 meetings per day, as loan officers no longer
have to deal with administrative work after a meeting. As a result, loan officers now only conduct meetings from Monday
to Wednesday and dedicate Thursdays and Fridays solely for customer acquisition and visits (prior to this, meetings were
conducted Mon-Thu). Management expects this strategy will help improve the bank’s customer acquisition process.
Meanwhile, the bank’s management has also reorganized sentra meetings based on location to help cut travelling time of
loan officers and maximize customer interaction.

 Change in employee incentive scheme. BTPS was able to lower its employee turnover to 40% from previously 60% by
imposing a new incentive scheme—incentives are now given 2x, once prior to and once post Eid al-Fitr Holidays, to
improve retention rates. Prior to this, incentives were only given prior to Eid al-Fitr holidays, resulting in high resignations
and hence disrupting the bank’s business flow. The bank also saw improvement in working conditions resulting from the
implementation of tablets.

 Maintain BUY with revised TP of Rp4,200 as we roll over our numbers to 2020F. Our new TP implies 4.8x 2020F P/BV.

FINANCIAL SUMMARY
YE Dec (Rp Bn) 2017A 2018A 2019F 2020F 2021F
Pre-Provision Profit 1,124 1,568 2,096 2,636 3,194
Net Profit 670 965 1,338 1,720 2,096
EPS 87 125 174 223 272
EPS Growth (%) 62.5 44.0 38.6 28.5 21.9
P/E Ratio (x) 40.8 28.3 20.4 15.9 13.0
BVPS 293 519 693 881 1,109
P/BV Ratio (x) 12.1 6.8 5.1 4.0 3.2
Dividend Yield (%) 0.0 0.0 0.0 1.0 1.3
ROAE (%) 34.8 30.9 28.7 28.4 27.3
CAR (%) 28.9 40.9 40.0 40.9 42.0

Source: Company (2017-2018), Mandiri Sekuritas (2019-2021)

Please see important disclosure at the back of this report Page 4 of 10

 Equity Research | 23 October 2019

CHANGE IN ESTIMATES
Year-end Dec 31 Old New Change (%)
(IDRbn) 2019E 2020E 2021E 2019E 2020E 2021E 2019E 2020E 2021E

Net interest income 3,771 4,529 5,427 3,830 4,686 5,603 1.6 3.5 3.3
Net interest margin (%) 29.6 29.0 28.6 29.7 29.3 28.6
Total Income 3,796 4,563 5,469 3,849 4,711 5,631 1.4 3.2 3.0
PPOP 2,055 2,495 3,000 2,096 2,636 3,194 2.0 5.7 6.4
Operating Profit 1,745 2,199 2,722 1,802 2,293 2,795 3.3 4.3 2.7
Reported Net Profit 1,307 1,648 2,040 1,338 1,720 2,096 2.4 4.4 2.7

Loan growth 20.8 19.7 19.4 23.2 20.5 19.4

Deposit growth 20.2 18.7 18.2 22.2 21.7 20.7
LDR 96.1 96.8 97.9 96.3 95.3 94.2
NPL 1.3 1.2 1.1 1.3 1.2 1.1
Coverage ratio 165.1 167.1 169.1 225.2 215.2 205.2
Cost of Credit 3.5 2.8 2.2 3.3 3.2 3.1
NIM 29.6 29.0 28.6 29.7 29.3 28.6
Cost to income 45.8 45.3 45.1 45.5 44.0 43.3
ROE 28.2 27.7 27.3 28.8 28.6 27.6
CAR 41.7 43.0 44.6 40.0 40.9 42.0
Source: Mandiri Sekuritas estimates

Priscilla Thany (+62 21 5296 9546) priscilla.thany@mandirisek.co.id

Tjandra Lienandjaja (+6221 5296 9617) tjandra.lienandjaja@mandirisek.co.id
Silvony Gathrie (+6221 5296 9544) silvony.gathrie@mandirisek.co.id

MARKET

Market Recap October 22nd 2019; JCI 6,225.50 Points +26.51 pts (+0.43%); Valued $457mn; Mkt Cap $492bn; USD/IDR
14,038

 TOP TURNOVER: BBCA BBRI TLKM HMSP ASII BMRI BBNI GGRM UNVR BTPS TPIA BRPT UNTR PGAS ISAT (35%)
 ADVANCING SECTOR: telco+3.7%; financial+0.8%; construction+0.5%; property+0.4%
 DECLINING SECTOR: consumer & auto-0.8%; cement-0.3%; plantation-0.2%; mining-0.1%
 As expected, the JCI stayed put, still in black though; while awaiting for cabinet line-up announcement scheduled
tomorrow morning. Investors can breathe easily after President Joko Widodo reinstated Sri Mulyani Indrawati as finance
minister. Lack of fresh incentives turned investors sidelined. Cigarette makers stayed out of favor after reporting a drop in
sales volume in anticipation for sharp increase in cigarette excise tax. Share prices of both GGRM (cls-3.1%) and HMSP (cls-
3.6%) have been on decline steadily since last week. While, the share price of BBCA contributed the most to the index
gain, increasing 1.3%. In the end, the JCI rose 0.4% at 6225 level. Market turnover (excluding $10.4MN ASMI; $6MN JAST;
$5.8MN TGRA; $5.7MN DILD; $5.5MN MAPI crossing) was thin at $457MN. Foreign participants at 25% came up very small
better seller. Losers beat gainers by 12 to 10. The IDR strengthened against the USD from 14079 to 14038. The benchmark
10-year bond rose and the yield fell 1.5 bps to 7.100%. This month, the JCI rose 0.9%. This year, it rose 0.5%, heading for
the worst year since 2017. It advanced 6.6% in the past 52 weeks. The MSCI AC Asia Pacific Index gained 4.4% in the same
period. It is now 6.2% below its 52-week high on April 18, 2019 and 10.7% above its low on Oct 25, 2018. It is up 1.1% in
the past five days and was little changed in the past 30 days. It is trading at a PER of 19.7x on a trailing basis and 15.9x
estimated earnings of its members for the coming year. Its dividend yield is 2.5% on a trailing 12-month basis. Its
members have a total market capitalization of IDR7.15 quadrillion. The 30-day price volatility rose to 11.57% compared
with 11.72% in the previous session and the average of 11.04% over the past month. Foreign selling of Indonesia's stocks
slowed in the past week as the nation's benchmark equity index rose and the IDR strengthened. The five-day moving
average of net foreign outflows slowed to $14.5MN, compared with the 20-day average outflows of $15.7MN.

Sales Team +6221 527 5375

Please see important disclosure at the back of this report Page 5 of 10

 Equity Research | 23 October 2019

FROM THE PRESS

Government Anticipated Widening Budget Deficit

Government issued finance ministry rule No.144/2019 about deficit estimation and additional financing for state budget 2019.
Finance ministry mentioned this rule is made as government is not able to add other bonds issuances according to the
previous law (UU No No.12/2018 about state budget 2019). The government will announce whether it need widening budget
deficit and additional financing within this month. (Bisnis Indonesia)

LPS: third party funds growth will improve

LPS sees that third party funds growth will improve while loan disbursement will be more prudent as banks maintain asset
quality and profitability. Surveillance and financial system stability group director of LPS, Priyantina states that loan growth
expansions are mostly will come from the big banks, however, it would still depend on deposit growth. LPS target loan and
deposit growth will be at +11.7%yoy and +7.4%yoy, respectively, for this year. (Kontan)

Potential cut in Statutory Reserve Requirement (GWM)

BI may potentially cut the Statutory Reserve Requirement (GWM) in response to the industry’s high LDR level. This will be
decided upon during the Board of Governors meeting today. (Bisnis Indonesia)

Ace Hardware (ACES) targets to open 6 more stores this year

ACES targets to open total of 20 stores in 2019. The Company will open its 14th new store in Living Plaza Jababeka, Bekasi
tomorrow (24/10). Helen Tanzil, Corporate Secretary of ACES, said the Company will stick to their initial target even though it
means that ACES needs to open 6 new stores in 2.5 months time. (Bisnis)

Bank BNI (BBNI) partners up with Grab to increase CASA

The bank states that there are potential 5mn Grab partners that may open saving accounts that would increase the bank’s
CASA. (Investor Daily)

Bank BTN (BBTN) targets loan growth of +8%yoy for 2020

BBTN targets lower loan growth for 2020 at +8%yoy compared to this year’s target at +10-12%yoy. CFO of the bank, Nixon
Napitupulu states that one of the reason for lower loan growth target is due to lower budget for FLPP subsidy of 100k units for
next year. He also explains that demand for apartment will remain slow, and the bank has shifted its target market to housing
with price below Rp500mn. Tight liquidity condition of the bank is also a concern as LDR reached 103% last year, and
102-103% expected for this year. (Investor Daily)

Telkomsel continues to develop BTS NB-IoT in Indonesia

Telkomsel, subsidiary of Telkom Indonesia (TLKM IJ), continues to develop BTS Narrow Band – Internet of Things (NB-IoT) in
Indonesia in order to support enterprise business segment. Currently the stated technology is implemented in 23 cities across
Indonesia. (Bisnis)

Unilever (UNVR) plans 5-for-1 stock split

The Extraordinary General Meeting of Shareholders (EGMS) to discuss this stock split will be held on Wednesday, November
20, 2019. Sancoyo Antarikso, Corporate Secretary of UNVR, said this stock split plan will increase the stock liquidity and will be
more affordable for retail investor. (Kontan)

VoLTE gains traction from telco operators

Several telco operators in Indonesia starts to trial Voice Over Long Term Evolution (VoLTE) technology as it provides better
voice experience to subscribers compared to Voice Over IP (VoIP). Indosat and Telkomsel, for instance, have trailed the
technology this year. Meanwhile, Smartfren has applied the technology as the company uses 4G technology from the
beginning. (Bisnis Indonesia)

Please see important disclosure at the back of this report Page 6 of 10

 Equity Research | 23 October 2019

Indices and Fund Flows Currencies and Bonds Major Commodities

YTD Chg YTD YTD

Indices Last Chg (%) Currency Last Chg (%) Last Chg (%)
(%) Chg (%) Chg (%)

JCI 6,225.5 +0.4 +0.5 Rp/US$ 14,017 -0.34 +2.9 Oil spot (US$/bl) 54.16 +1.6 +19.3
Dow Jones 26,788.1 -0.2 +14.8 US$/EUR 1.113 -0.22 +3.1 Nickel spot (US$/mt) 16,491 +2.6 +55.5
Nikkei 22,548.9 +0.3 +12.7 YEN/US$ 108.49 -0.12 +1.1 Gold spot (US$/oz) 1,488 +0.2 +16.0
Hang Seng 26,786.2 +0.2 +3.6 SGD/US$ 1.363 +0.12 +0.0 Tin 3-month (US$/mt) 16,850 +0.5 -13.5
STI 3,160.7 +0.7 +3.0 CPO futures (Ringgit/ton) 2,317 +1.4 +9.2
Ishares indo 25.3 +0.4 +1.8 Coal (US$/ton) 67.5 -0.2 -33.9
Rubber forward (US¢/kg) 144.0 -0.7 -3.0
Foreign YTD
YTD Gov. Bond Chg Soybean oil
Fund Flows Last Chg Last Chg 30.85 +1.2 +12.0
Chg Yield (bps) (US$/100gallons)
(US$mn) (bps)
Equity Flow -2.9 +3,465 5Yr 6.57 -3 -133 Baltic Dry Index 1,846.0 +0.0 +45.2
Bonds Flow +64.0 +10,102 10Yr 7.10 -2 -93

Please see important disclosure at the back of this report Page 7 of 10

 Equity Research | 23 October 2019

Equity Valuation
Price Price % of Mkt Cap Net Profit PER (x) P/BV (x) EV/EBITDA (x) EPS Growth Div.Yield
Code Rating (Rp) Target PT (Rp Bn) 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020
MANSEK universe 6,225 6,650 6.8 4,464,629 265,164 278,981 16.8 16.0 2.5 2.3 13.8 13.3 8.2% 4.9% 2.6% 2.8%
Financials 1,644,676 103,185 116,292 15.9 14.1 2.3 2.2 0.0 0.0 11.8% 12.7% 2.1% 2.5%
BBCA Neutral 31,500 26,500 (15.9) 776,633 29,483 32,062 26.3 24.2 4.5 4.0 N.A. N.A. 14.0% 8.7% 1.1% 1.2%
BBNI Neutral 7,325 9,000 22.9 136,601 16,642 18,879 8.2 7.2 1.2 1.1 N.A. N.A. 10.8% 13.4% 4.4% 5.5%
BBRI Buy 4,140 5,000 20.8 510,456 36,551 41,656 14.0 12.3 2.5 2.3 N.A. N.A. 13.0% 14.0% 3.2% 3.6%
BBTN Buy 1,915 2,700 41.0 20,280 1,168 3,612 17.4 5.6 0.8 0.8 N.A. N.A. -58.4% 209.4% 2.8% 2.8%
BDMN Neutral 4,580 4,900 7.0 44,763 5,849 4,698 7.5 9.3 1.0 0.9 N.A. N.A. 49.1% -19.7% 3.1% 4.6%
BJBR Neutral 1,870 1,770 (5.3) 18,805 1,444 1,838 13.0 10.2 1.5 1.5 N.A. N.A. -8.8% 27.4% 4.7% 4.2%
BJTM Neutral 675 670 (0.7) 10,110 1,253 1,305 8.1 7.7 1.1 1.0 N.A. N.A. -0.6% 4.2% 6.8% 6.8%
BNGA Neutral 990 1,350 36.4 24,880 3,946 4,261 6.3 5.8 0.6 0.6 N.A. N.A. 13.3% 8.0% 2.8% 3.2%
BNLI Neutral 1,260 465 (63.1) 35,334 1,081 1,409 32.7 25.1 1.5 1.4 N.A. N.A. 69.0% 30.3% 0.0% 0.0%
PNBN Buy 1,275 1,550 21.6 30,712 2,990 3,318 10.3 9.3 0.8 0.7 N.A. N.A. -3.0% 11.0% 0.0% 0.0%
BTPS Buy 3,550 4,200 18.3 27,348 1,338 1,720 20.4 15.9 5.1 4.0 N.A. N.A. 38.6% 28.5% 0.0% 1.0%
BFIN Buy 585 900 53.8 8,754 1,441 1,532 6.1 5.7 1.2 1.1 N.A. N.A. -1.9% 6.4% 5.0% 4.9%
Construction & materials 257,360 14,565 17,147 17.7 15.0 1.8 1.6 11.2 10.0 -8.0% 17.7% 1.5% 1.8%
INTP Buy 20,000 23,500 17.5 73,625 1,868 2,478 39.4 29.7 3.0 2.8 20.8 16.5 65.5% 32.7% 0.5% 0.9%
SMGR Buy 12,575 16,100 28.0 74,589 2,253 3,708 33.1 20.1 2.3 2.1 12.3 10.1 -26.8% 64.6% 1.1% 1.7%
ADHI Buy 1,270 2,035 60.2 4,522 721 672 6.3 6.7 0.7 0.6 5.3 5.3 11.9% -6.8% 2.8% 3.2%
PTPP Buy 1,735 3,085 77.8 10,757 1,731 2,088 6.2 5.2 0.8 0.7 4.5 4.1 15.3% 20.6% 4.2% 4.8%
WIKA Buy 2,000 2,885 44.3 17,920 2,101 2,002 8.5 8.9 1.1 1.0 5.7 5.3 21.4% -4.7% 2.3% 2.2%
WSKT Buy 1,630 2,280 39.9 21,811 2,699 2,997 8.1 7.3 1.1 1.0 11.5 11.8 -31.9% 11.1% 2.5% 2.7%
WTON Buy 472 700 48.3 4,114 525 608 7.8 6.8 1.2 1.0 4.4 3.8 8.0% 15.7% 3.5% 3.8%
WSBP Buy 342 420 22.8 9,016 1,002 1,077 9.0 8.4 1.1 1.0 6.9 6.0 -9.2% 7.4% 6.1% 5.6%
JSMR Buy 5,650 7,700 36.3 41,007 1,666 1,517 24.6 27.0 2.3 2.1 16.8 13.7 -24.4% -8.9% 1.1% 0.8%
Consumer staples 1,020,914 47,701 43,843 21.4 23.3 5.5 5.3 13.9 14.8 8.4% -8.1% 3.2% 3.4%
ICBP Buy 11,425 12,350 8.1 133,237 5,042 5,414 26.4 24.6 5.5 4.9 15.6 15.1 10.2% 7.4% 1.8% 2.0%
INDF Buy 7,375 9,750 32.2 64,752 4,610 4,929 14.0 13.1 1.8 1.7 8.3 7.9 10.7% 6.9% 4.1% 4.5%
MYOR Neutral 2,180 2,850 30.7 48,743 1,864 2,152 26.1 22.6 5.1 4.4 13.8 12.2 8.6% 15.5% 1.3% 1.4%
UNVR Neutral 43,950 48,200 9.7 335,339 7,361 7,969 45.6 42.1 57.5 52.1 31.5 28.9 -19.2% 8.3% 2.7% 2.2%
GGRM Buy 51,475 63,450 23.3 99,042 9,642 7,512 10.3 13.2 1.9 1.8 7.1 8.2 23.7% -22.1% 2.9% 2.9%
HMSP Buy 2,120 2,450 15.6 246,594 15,885 12,297 15.5 20.1 6.5 7.1 11.4 15.3 17.3% -22.6% 5.4% 6.3%
KLBF Buy 1,630 1,950 19.6 76,406 2,557 2,742 29.9 27.9 4.8 4.4 19.0 17.6 4.1% 7.2% 1.7% 1.8%
SIDO Buy 1,120 1,050 (6.3) 16,800 739 827 22.7 20.3 5.1 4.5 16.5 14.6 11.4% 11.9% 3.5% 3.9%
Healthcare 61,841 971 1,126 63.7 54.9 5.0 4.4 22.2 18.9 28.7% 16.0% 0.0% 0.0%
MIKA Buy 2,720 2,950 8.5 39,578 727 805 54.4 49.2 9.6 7.4 34.1 30.4 18.5% 10.7% 0.0% 0.0%
SILO Buy 7,425 7,150 (3.7) 12,066 21 44 562.9 271.9 1.9 1.9 12.6 10.4 33.1% 107.0% 0.0% 0.0%
HEAL Buy 3,430 5,000 45.8 10,197 222 277 45.9 36.8 5.1 4.5 15.8 13.1 78.5% 24.8% 0.0% 0.0%
Consumer discretionary 401,772 30,959 31,704 13.0 12.7 2.1 1.9 9.1 9.1 7.5% 2.4% 3.2% 3.5%
ACES Neutral 1,850 1,800 (2.7) 31,728 1,110 1,183 28.6 26.8 6.5 5.8 23.3 21.5 15.1% 6.5% 1.5% 1.8%
LPPF Buy 4,170 3,400 (18.5) 12,168 1,702 1,676 7.2 7.3 4.1 3.5 4.2 4.0 55.1% -1.5% 4.5% 9.8%
MAPA Buy 5,300 7,550 42.5 15,107 797 1,004 19.0 15.0 4.8 3.9 11.5 9.2 125.4% 26.0% 0.0% 1.6%
MAPI Buy 1,150 1,300 13.0 19,090 1,044 1,293 18.3 14.8 3.0 2.5 7.6 6.4 41.9% 23.8% 0.6% 0.8%
RALS Buy 1,230 1,600 30.1 8,728 634 697 13.8 12.5 2.1 2.0 7.1 6.5 7.9% 10.0% 4.0% 4.7%
ASII Buy 6,750 8,200 21.5 273,264 21,698 21,514 12.6 12.7 1.8 1.7 9.4 9.9 0.1% -0.9% 3.6% 3.6%
SCMA Buy 1,325 1,600 20.8 19,523 1,443 1,561 13.5 12.5 3.8 3.5 9.3 8.4 -3.6% 8.2% 5.2% 5.6%
MNCN Buy 1,335 1,800 34.8 16,559 2,040 2,214 8.1 7.5 1.5 1.2 5.7 5.1 34.2% 8.5% 1.8% 2.0%
MSIN Buy 456 650 42.5 2,372 291 325 8.1 7.3 1.7 1.5 5.5 4.6 38.2% 11.4% 6.1% 6.8%
PZZA Buy 1,070 1,400 30.8 3,233 201 237 16.1 13.6 2.3 2.1 8.0 6.9 15.8% 18.3% 1.1% 1.2%
Commodities 243,369 27,448 26,237 8.8 9.3 1.1 1.0 4.1 4.0 -10.7% -5.1% 4.3% 3.9%
UNTR Buy 21,500 31,200 45.1 80,198 10,892 10,254 7.4 7.8 1.3 1.2 3.8 3.8 -2.1% -5.9% 4.1% 3.8%
ADRO* Neutral 1,365 1,300 (4.8) 43,661 380 313 8.1 10.0 0.8 0.8 3.6 3.6 -9.1% -17.6% 4.9% 3.7%
HRUM* Neutral 1,300 1,500 15.4 3,337 22 17 10.5 14.2 0.8 0.8 0.5 0.4 -29.7% -25.1% 5.2% 3.9%
INDY* Neutral 1,350 1,500 11.1 7,034 46 50 10.8 9.9 0.5 0.5 2.3 2.0 -42.8% 10.3% 2.3% 2.5%
ITMG* Neutral 12,700 17,000 33.9 13,926 150 127 6.5 7.8 1.1 1.1 2.3 2.7 -42.2% -15.2% 13.0% 10.8%
PTBA Neutral 2,360 3,000 27.1 27,193 3,957 3,476 6.5 7.8 1.6 1.4 4.8 4.7 -23.9% -16.4% 7.3% 6.4%

Please see important disclosure at the back of this report Page 8 of 10

 Equity Research | 23 October 2019

Price Price % of Mkt Cap Net Profit PER (x) P/BV (x) EV/EBITDA (x) EPS Growth Div.Yield
Code Rating (Rp) Target PT (Rp Bn) 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020
ANTM Buy 930 1,100 18.2 22,349 910 959 24.6 23.3 1.1 1.1 11.2 10.6 4.0% 5.5% 1.4% 1.5%
INCO* Buy 3,400 4,000 17.7 33,784 54 111 44.0 21.7 1.2 1.2 9.5 7.0 -11.0% 106.7% 0.7% 1.4%
TINS Buy 905 2,200 143.1 6,740 1,262 1,492 5.3 4.5 0.9 0.8 3.3 2.9 137.4% 18.3% 6.6% 7.7%
MDKA* Buy 1,205 8,000 563.9 5,148 80 99 4.5 3.8 0.7 0.6 3.3 2.8 49.5% 20.3% 0.0% 0.0%
Property & Industrial Estate 144,405 10,400 9,969 13.2 14.5 1.1 1.1 10.9 11.1 20.6% -9.0% 1.2% 1.2%
ASRI Neutral 286 310 8.4 5,620 663 468 8.5 12.0 0.6 0.5 10.0 12.3 -31.7% -29.4% 0.7% 0.7%
BSDE Buy 1,420 1,650 16.2 27,330 2,441 2,086 11.2 13.1 1.0 0.9 10.9 10.0 88.6% -14.5% 0.0% 0.0%
CTRA Buy 1,180 1,550 31.4 21,901 965 1,128 22.7 19.4 1.4 1.4 14.0 12.8 -18.3% 17.0% 0.9% 0.7%
JRPT Buy 640 1,050 64.1 8,800 1,010 949 8.7 9.3 1.3 1.1 7.6 8.1 -2.3% -6.0% 4.7% 2.6%
PWON Buy 610 800 31.1 29,377 2,523 2,532 11.6 11.6 2.0 1.7 8.9 8.7 -0.8% 0.3% 1.0% 1.0%
SMRA Neutral 1,220 1,330 9.0 17,601 356 550 49.4 32.0 2.4 2.3 15.3 13.2 -20.6% 54.4% 0.4% 0.4%
LPKR Buy 234 360 53.8 16,519 1,316 861 8.8 19.2 0.5 0.5 9.5 13.5 9.4% -54.0% 0.4% 0.4%
DMAS Buy 304 390 28.3 14,652 675 855 21.7 17.1 2.0 2.0 20.3 16.3 36.1% 26.6% 4.1% 5.2%
BEST Buy 270 400 48.1 2,605 452 540 5.8 4.8 0.6 0.5 5.9 5.6 7.0% 19.4% 3.4% 4.1%
Telco 548,503 23,325 24,916 23.5 22.0 3.6 3.5 7.2 6.6 45.8% 6.8% 3.1% 3.3%
EXCL Buy 3,520 4,200 19.3 37,622 723 846 52.1 44.5 2.0 1.9 5.9 5.6 N/M 17.1% 0.0% 0.0%
TLKM Buy 4,230 4,750 12.3 419,033 19,501 20,741 21.5 20.2 4.0 3.8 7.3 6.7 8.1% 6.4% 3.5% 3.7%
ISAT Neutral 3,390 3,300 (2.7) 18,421 -888 -847 -20.7 -21.7 1.8 2.0 4.7 4.7 63.0% 4.6% 0.0% 0.0%
LINK Buy 4,150 5,500 32.5 12,084 1,064 1,085 11.5 11.3 2.3 2.1 5.4 5.1 34.8% 2.0% 4.4% 4.5%
TBIG Buy 6,375 7,700 20.8 27,674 838 931 33.0 29.7 7.7 7.0 12.9 12.3 23.1% 11.1% 2.2% 2.2%
TOWR Buy 660 920 39.4 33,670 2,088 2,161 16.1 15.6 3.8 3.4 9.0 8.3 -5.5% 3.5% 3.6% 3.6%
Chemical 1,809 105 136 17.3 13.3 0.6 0.5 6.7 6.1 5.0% 29.5% 0.0% 0.0%
AGII Buy 590 700 18.6 1,809 105 136 17.3 13.3 0.6 0.5 6.7 6.1 5.0% 29.5% 0.0% 0.0%
Airlines 5,308 427 529 12.4 10.0 1.0 1.0 7.3 6.2 -2.9% 24.0% 0.0% 0.0%
GMFI* Neutral 188 275 46.1 5,308 30 38 12.4 10.0 1.0 1.0 7.3 6.2 -2.0% 26.1% 0.0% 0.0%
Transportation 5,805 458 522 12.7 11.1 1.1 1.0 5.2 4.8 0.1% 14.0% 2.2% 2.5%
BIRD Buy 2,320 3,935 69.6 5,805 458 522 12.7 11.1 1.1 1.0 5.2 4.8 0.1% 14.0% 2.2% 2.5%
Poultry 128,867 5,620 6,561 22.9 19.6 3.7 3.3 13.3 11.8 -19.8% 16.7% 1.8% 1.4%
CPIN Neutral 6,525 4,950 (24.1) 106,997 3,624 4,219 29.5 25.4 5.0 4.4 18.2 15.8 -20.4% 16.4% 1.6% 1.2%
JPFA Buy 1,655 1,950 17.8 19,407 1,717 2,042 11.3 9.5 1.8 1.6 7.0 6.4 -20.8% 19.0% 3.1% 2.4%
MAIN Buy 1,100 1,150 4.5 2,463 280 300 8.8 8.2 1.1 1.0 5.7 5.1 -1.8% 7.1% 1.4% 1.5%
Note:
- *) net profit in USD mn
- U/R means Under Review
- n/a means Not Available
- N/M means Not Meaningful
- N.A means Not Applicable

Please see important disclosure at the back of this report Page 9 of 10

 Mandiri Sekuritas A subsidiary of PT Bank Mandiri (Persero) Tbk
Menara Mandiri Tower I, 25th floor, Jl. Jend. Sudirman Kav. 54 – 55, Jakarta 12190, Indonesia
General: +62 21 526 3445, Fax : +62 21 527 5374 (Equity Sales)

RESEARCH
Adrian Joezer Head of Equity Research, Strategy, Consumer adrian.joezer@mandirisek.co.id +6221 5296 9415
Tjandra Lienandjaja Deputy Head of Equity Research, Banking tjandra.lienandjaja@mandirisek.co.id +6221 5296 9617
Ariyanto Kurniawan Automotive, Coal, Metal Mining, Chemical ariyanto.kurniawan@mandirisek.co.id +6221 5296 9682
Kresna Hutabarat Telecom, Media kresna.hutabarat@mandirisek.co.id +6221 5296 9542
Priscilla Thany Banking, Building Material priscilla.thany@mandirisek.co.id +6221 5296 9569
Lakshmi Rowter Healthcare, Consumer, Retail lakshmi.rowter@mandirisek.co.id +6221 5296 9549
Robin Sutanto Property robin.sutanto@mandirisek.co.id +6221 5296 9572
Edbert Surya Construction, Transportation edbert.surya@mandirisek.co.id +6221 5296 9623
Silvony Gathrie Banking, Research Assistant silvony.gathrie@mandirisek.co.id +6221 5296 9544
Riyanto Hartanto Poultry, Research Assistant riyanto@mandirisek.co.id +6221 5296 9488
Henry Tedja Research Assistant henry.tedja@mandirisek.co.id +6221 5296 9434
Wesley Louis Alianto Research Assistant wesley.alianto@mandirisek.co.id +6221 5296 9510
Leo Putera Rinaldy Chief Economist leo.rinaldy@mandirisek.co.id +6221 5296 9406
Imanuel Reinaldo Economist imanuel.reinaldo@mandirisek.co.id +6221 5296 9651

INSTITUTIONAL SALES
Silva Halim Head Institutional Equities silva.halim@mandirisek.co.id +6221 527 5375
Andrew Handaya Institutional Sales andrew.handaya@mandirisek.co.id +6221 527 5375
Feliciana Ramonda Institutional Sales feliciana.ramonda@mandirisek.co.id +6221 527 5375
Henry Pranoto Institutional Sales henry.pranoto@mandirisek.co.id +6221 527 5375
Kevin Giarto Institutional Sales kevin.giarto@mandirisek.co.id +6221 527 5375
Sharon Anastasia Tjahjadi Institutional Sales sharon.tjahjadi@mandirisek.co.id +6221 527 5375
Talitha Medha Anindya Institutional Sales talitha.anindya@mandirisek.co.id +6221 527 5375
Kusnadi Widjaja Equity Dealing kusnadi.widjaja@mandirisek.co.id +6221 527 5375
Edwin Pradana Setiadi Equity Dealing edwin.setiadi@mandirisek.co.id +6221 527 5375
Jane Theodoven Sukardi Equity Dealing jane.sukardi@mandirisek.co.id +6221 527 5375
Michael Taarea Equity Dealing michael.taarea@mandirisek.co.id +6221 527 5375

RETAIL SALES
Andreas M. Gunawidjaja Head Retail Equities andreas@mandirisek.co.id +6221 526 9693
Boy Triyono Jakarta boy.triyono@mandirisek.co.id +6221 526 5678
Dhanan Febrie Handita Bandung dhanan.handita@mandirisek.co.id +6222 426 5088
Yogiswara Perdana Yogyakarta yogiswara.perdana@mandirisek.co.id +62274 560 596
Widodo Solo widodo@mandirisek.co.id +62271 788 9290
Linawati Surabaya Linawati@mandirisek.co.id +6231 535 7218
Ruwie Medan ruwie@mandirisek.co.id +6261 8050 1825
Aidil Idham Palembang aidil.idham@mandirisek.co.id +62711 319 900
Yuri Ariadi Pontianak yuri.ariadi@mandirisek.co.id +62561 582 293

INVESTMENT RATINGS: Indicators of expected total return (price appreciation plus dividend yield) within the 12-month period from the date of the last
published report, are: Buy (15% or higher), Neutral (-15% to15%) and Sell (-15% or lower).

DISCLAIMER: This report is issued by PT. Mandiri Sekuritas, a member of the Indonesia Stock Exchanges (IDX) and Mandiri Sekuritas is registered and
supervised by the Financial Services Authority (OJK). Although the contents of this document may represent the opinion of PT. Mandiri Sekuritas, deriving its
judgement from materials and sources believed to be reliable, PT. Mandiri Sekuritas or any other company in the Mandiri Group cannot guarantee its
accuracy and completeness. PT. Mandiri Sekuritas or any other company in the Mandiri Group may be involved in transactions contrary to any opinion herein
to make markets, or have positions in the securities recommended herein. PT. Mandiri Sekuritas or any other company in the Mandiri Group may seek or will
seek investment banking or other business relationships with the companies in this report. For further information please contact our number
62-21-5263445 or fax 62-21-5275374.

ANALYSTS CERTIFICATION: Each contributor to this report hereby certifies that all the views expressed accurately reflect his or her views about the
companies, securities and all pertinent variables. It is also certified that the views and recommendations contained in this report are not and will not be
influenced by any part or all of his or her compensation.