UOBKayhian on 3 Mar 2014
FY14F PE (x): 12.8
FY15F PE (x): 11.8
Bumitama Agri (BAL) reported core net profit of Rp370b (+97.1% qoq, +100.4% yoy) for
4Q13 and Rp879b (+19.4% yoy) for 2013. 4Q13 results were ahead of expectations due
to: a) strong CPO and PK ASP, b) lower cost as fertiliser applications were minimal in
the quarter, and c) a weakening rupiah boosting revenue as sales are in US dollars.
Debt restructuring also led to a substantial decline in interest expense (-50% yoy with
estimated effective interest rate of 1.7% vs 2013’s 4.6%)
Maintain BUY and target price of S$1.40, based on 15x 2014F PE. We like BAL for its
young age profile and best OER to support its 5-year net profit CAGR of 32%.
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