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AALI - Another weak result

Astra Agro Lestari (AALI) – HOLD (Maintain)

Price: Rp19,675 – Target Price: Rp19,000

Another weak result

  • Below market expectation.
  • AALI not benefiting from IDR depreciation.
  • Maintain HOLD with lower TP.


 

PTBA – Coal market pessimism overshadows result

Tambang Batubara Bukit Asam (PTBA) – HOLD (Maintain)

Price: Rp5,950 – Target Price: Rp6,800
Coal market pessimism overshadows results

  • Lower stipping ratio in 2Q15 drives margins higher QoQ.
  • Upgrading FY15E earnings but reducing long-term expectations.
  • Lack of a positive catalyst, maintain HOLD.

 

ROTI - Delivering growth

Nippon Indosari Corpindo (ROTI) – BUY (Maintain)

Price: Rp1,190 – Target Price: Rp1,435
Delivering growth

  • Sales growth improves.
  • A&P spending rose but appears to work.
  • Our top pick in consumer sector. BUY.

Strategy Outlook - Tapering growth expectations

Strategy Outlook – Tapering growth expectations

With the World Bank and Bank of Indonesia both lowering their 2015 GDP growth targets, we adjust our JCI year-end target to reflect slower economic and earnings growth for the year.  We also anticipate an interest rate cut by the Bank of Indonesia no earlier than 4Q15 which will be too late to positively impact 2015 corporate earnings though it should stimulate greater growth for 2016.

 

Coal Sector – China’s import drop worsens coal price outlook

Coal Sector – Neutral (Maintain)

China’s import drop worsens coal price outlook

  • No catalyst in sight for coal price.
  • Indonesia production down 19.4% at 5M15 YoY.
  • Valuations look reasonable after recent correction with ADRO as top pick.