Astra International (ASII IJ)

Transcription

1 Equity Research Company Update Thursday,19 April 2018 BUY Maintain Last price (IDR) 7,525 Target Price (IDR) 9,100 Upside/Downside +20.9% Previous Target Price (IDR) 9,100 Stock Statistics Sector Bloomberg Ticker Automotive ASII IJ No of Shrs (mn) 40,484 Mkt. Cap (IDRbn/USDmn) 304,639/22,424 Avg. daily T/O (IDRbn/USDmn) 230.3/16.7 Major shareholders (%) Jardine Cycle & Carriage 50.1 Estimated free float 49.9 EPS Consensus (IDR) 2018F 2019F 2020F Danareksa Consensus Danareksa/Cons (3.1) (3.1) (2.4) ASII relative to JCI Index Source : Bloomberg x Stefanus Darmagiri (62-21) stefanus.darmagiri@danareksa.com Astra International (ASII IJ) Improvement in monthly 4W market share From the recent data from The Association of Indonesia Automotive Industries (Gaikindo) of which domestic car market was 101,674 units in March 2018 (+7.7% mom, but -0.6% yoy), Astra International (ASII) managed to post higher monthly car sales by 12.1% mom. This resulted on rising market share of ASII in 4W to 50.0% in March 2018 (February 2018: 48.0%). Nonetheless, the competition resulted on ASII s market share declined to 48.6% in 1Q18 (2017: 53.6%). Maintain BUY recommendation. Improvement in monthly domestic car sales volume. Gaikindo reported domestic car sales volume of 101,674 units in March 2018 (+7.7% mom, but 0.6% yoy). On cumulative basis, domestic car sales was increased by 2.9% yoy to 292,028 units in 1Q18. As it accounted for about 25.8% of our forecast, the number was within our expectation. Stronger monthly sales volume for ASII increased its market share. ASII managed to increase its monthly sales volume by 12.1% mom (which was higher than the industry), thanks to improvement in sales volume of Toyota (+13.4% mom) and Daihatsu (+9.6% mom). Toyota s strong improvement came from greater delivery of Rush (+40.6% mom). Hence, ASII s 4W market share improved to 50.0% in March 2018 (February: 48.0%). Lower ASII car sales volume to impact on 1Q18 earnings in the automotive division. While domestic car sales managed to increase at 2.9% yoy, ASII experienced a decline in the car sales volume by 12.0% yoy to 141,952 units in 1Q18 as a result of tight competition in the 4W market following launching of Expander. This resulted on ASII s market share to decline to 48.6% in 1Q18 (1Q17: 56.9%). Lower car sales volume will impact on earnings in the automotive division in 1Q18. Strong heavy equipment sales to mitigate further decline on ASII s profit. With subsidiary, United Tractors (UNTR) posted strong Komatsu sales volume by +38.3% yoy, greater contribution of Komatsu from mining sector to 59.5% in 1Q18 (1Q17: 41.2%) to boost Komatsu s ASP and higher coal production, we expect strong earnings from heavy equipment and mining division. As such, we believe this will cushion the further decline on ASII s earnings in 1Q18. Maintain BUY. Despite stiffer competition in the domestic car market to impact on ASII s automotive margin, we maintain BUY recommendation on ASII with target price to IDR9,100 (based on SOTP valuation) as it still provides 20.9% upside to our target price. Also, the stock is also trading at -1SD deviation. Key Financials Year to 31 Dec 2016A 2017A 2018F 2019F 2020F Revenue (IDRbn) 181, , , , ,600 EBITDA (IDRbn) 24,219 27,371 29,810 32,928 35,780 EBITDA Growth (%) (1.1) Net profit (IDRbn) 15,156 18,881 20,472 22,418 24,356 EPS (IDR) EPS growth (%) BVPS (IDR) 2, , , , ,952.4 DPS (IDR) PER (x) PBV (x) Dividend yield (%) EV/EBITDA (x) Source : ASII, Danareksa Estimates See important disclosure at the back of this report 1

2 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 4W sales, '000 units ASII market share, % Exhibit 1. Revenues and Growth Exhibit 2. Net Profits and Growth Exhibit 3. Margins Exhibit 4. Gearing Level Exhibit 5. Improvement in ASII s market share in 4W to 50% in March Source: Gaikindo, Astra International See important disclosure at the back of this report 2

3 4W sales, '000 units 4W market share Exhibit 6. Car sales by brand Exhibit 7. Toyota remains the largest domestic car manufacturer 1Q17 1Q18 1Q17 1Q Toyota Daihatsu Suzuki Honda Mitsubishi 40.0% 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% 37.9% 29.1% 17.5% 17.7% 18.7% 18.9% 11.1% 12.4% 8.6% 9.1% Toyota Daihatsu Suzuki Honda Mitsubishi Source: Gaikindo, Astra International Exhibit 8. Tight competition in the LMPV market units Avanza and Xenia (LHS) 20,000 Expander (LHS) Avanza and Xenia shares in LMPV market (RHS) 72 15, , ,000 - Source: Gaikindo, Various newspaper sources Mar-17 Jun-17 Sep-17 Dec-17 Mar % Source: Gaikindo, Astra International Exhibit 9. Strong Rush and Terios boosted ASII s sales volume units 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 3,537 3,542 3,681 2,699 2,217 2,322 1,947 2,102 1,635 1,981 Source: Gaikindo, Various newspaper sources 5,928 5,180 7,365 0 Mar-17 May-17 Jul-17 Sep-17 Nov-17 Jan-18 Mar-18 Exhibit 10. ASII is trading at -1SD x sd +1sd mean -1sd -2sd 11 9 Jan 12 Sep 12 May 13 Jan 14 Sep 14 May 15 Jan 16 Sep 16 May 17 Jan 18 Source: Bloomberg, Danareksa estimates See important disclosure at the back of this report 3

4 Exhibit 11. Income Statement Year to 31 Dec (IDRbn) 2016A 2017A 2018F 2019F 2020F Revenue 181, , , , ,600 COGS (144,652) (163,689) (170,559) (183,779) (194,579) Gross profit 36,432 42,368 43,620 47,899 52,021 EBITDA 24,219 27,371 29,810 32,928 35,780 Oper. profit 17,534 20,326 22,018 24,535 26,707 Interest income 1,699 1,982 1,765 1,437 1,577 Interest expense (1,745) (2,042) (1,556) (1,586) (1,612) Forex Gain/(Loss) (155) (9) (17) Income From Assoc. Co s 3,349 6,694 6,897 7,455 7,459 Other Income (Expenses) 1,571 2,245 2,245 2,245 2,245 Pre-tax profit 22,253 29,196 31,352 34,460 36,942 Income tax (3,951) (6,031) (6,270) (6,892) (7,388) Minority interest (3,146) (4,284) (4,609) (5,151) (5,197) Net profit 15,156 18,881 20,472 22,418 24,356 Core Net Profit 15,311 18,890 20,489 22,044 23,790 Exhibit 12. Balance Sheet Year to 31 Dec (IDRbn) 2016A 2017A 2018F 2019F 2020F Cash & cash equivalent 29,357 31,574 25,714 28,208 30,123 Receivables 56,126 61,472 62,281 67,015 72,268 Inventory 17,771 19,504 17,619 18,984 20,100 Other Curr. Asset 6,250 8,438 5,216 5,642 6,006 Fixed assets - Net 66,695 76,488 75,081 79,023 83,436 Other non-curr.asset 84,757 97, , , ,271 Total asset 261, , , , ,509 ST Debt 45,820 43,584 35,063 34,482 33,999 Payables 30,085 39,281 32,217 34,714 36,754 Other Curr. Liabilities 13,174 15,857 15,857 15,857 15,857 Long Term Debt 25,090 31,394 25,844 26,906 27,864 Other LT. Liabilities 7,780 9,201 9,201 9,201 9,201 Total Liabilities 121, , , , ,675 Shareholder'sFunds 111, , , , ,006 Minority interests 27,955 32,684 37,481 42,631 47,829 Total Equity & Liabilities 261, , , , ,509 See important disclosure at the back of this report 4

5 Exhibit 13. Cash Flow Year to 31 Dec (IDRbn) 2016A 2017A 2018F 2019F 2020F Net income 15,156 18,881 20,472 22,418 24,356 Depreciation and Amort. 3,889 5,610 7,791 8,392 9,073 Change in Working Capital 232 3,206 (2,766) (4,029) (4,693) OtherOper. Cash Flow (1,076) (5,552) (1,823) (2,230) (3,080) Operating Cash Flow 18,201 22,145 23,676 24,551 25,656 Capex (8,546) (15,403) (6,384) (12,335) (13,486) Others Inv. Cash Flow (3,700) (5,514) (2,880) (3,532) (3,107) Investing Cash Flow (12,246) (20,917) (9,265) (15,867) (16,592) Net change in debt 261 4,068 (14,071) New Capital Dividend payment (6,801) (6,801) (9,441) (10,236) (11,209) Other Fin. Cash Flow 2,840 3,722 3,241 3,565 3,585 Financing Cash Flow (3,700) 989 (20,271) (6,190) (7,149) Net Change in Cash 2,255 2,217 (5,860) 2,494 1,914 Cash - begin of the year 27,102 29,357 31,574 25,714 28,208 Cash - end of the year 29,357 31,574 25,714 28,208 30,123 Exhibit 14. Key Ratios Year to 31 Dec 2016A 2017A 2018F 2019F 2020F Growth (%) Sales (1.7) EBITDA (1.1) Operating profit Net profit Profitability (%) Gross margin EBITDA margin Operating margin Net margin ROAA ROAE Leverage Net Gearing (x) Interest Coverage (x) Source : ASII, Danareksa Estimates See important disclosure at the back of this report 5

6 See important disclosure at the back of this report 6