Mandiri Sekuritas ID (13-Jan-2011) ADHI: New EPC contr

Adhi Karya: New EPC contract obtained has reached Rp903bn (ADHI, Rp840, Neutral, Rp870)
􀂄 ADHI has obtained new 3 EPC contracts for steam power plant (PLTU) amounting to Rp903bn early of this year. Each power plant has capacity 2x7MW, namely: PLTU Tembilahan, located in Indragiri Hilir, Riau (Rp277bn), PLTU Sintang, in Sanggau, West Kalimantan (Rp357bn) and PLTU Tanjung Selor, in East Kalimantan (Rp268bn).
􀂄 ADHI is targeting new contract FY11F to increase by 20.0% yoy from Rp8.1tn in FY10. ADHI will focus in EPC projects in this year. In FY10, Infrastructure contributed 45.1% of revenue, meanwhile EPC and building contributed 31.6% and 23.4%, respectively.
􀂄 We see EPC projects have robust room to growth due to government plan to increase the electrification ratio in Indonesia. Hence, the contribution of EPC projects to ADHI’s revenue will increase in the future.
􀂄 We have a Neutral recommendation, currently; ADHI is traded at PER11F of 7.9x

Sarana Menara Nusantara: Key takeaways from meeting with management (TOWR, Rp12550, Not Rated)
􀂄 Sarana Menara Nusantara (TOWR), also known as Protelindo, operates towers for wireless network purposes. Currently, TOWR has around 4,800 towers (3,168 co-location), of which around 3,900 (81%) of them is bought from and dedicated to Hutchinson. Number of tenants (BTS attached in towers) is at 7,996.
􀂄 Tower industry is high leveraged, yet very promising, which can be seen in high EBITDA and net margin. Up to 9M10, EBITDA margin stood at steady level of 86.2%, much higher even compared to global players. TOWR expect FY10F revenue at US$145mn (Rp1.3tn) or slightly up by 20.4% yoy.
􀂄 For year 2011-2012, TOWR still expect rapid growth in their business with revenue and EBITDA average growth at 15.7% and 16.0%.
􀂄 We currently have no recommendation on the stock, based on Bloomberg consensus, TOWR is traded at EV/EBITDA 11F 12.2x