NISP Sekuritas Daily 11 Jan 2011 (SMGR, BJBR, BWPT, ELSA, AMFG)

Semen Gresik invests Rp6.3tn for Sumatra plant (SMGR, Rp8.600)

·          Semen Gresik is investing Rp6.3tn or US$700mn to build 2 cement plants in Sumatra. With this, total capacity will increase by 2.5-3mn to 25mn tons. One of the new plants has been determined to be located in Sumatera Barat, while the other location is still being studied.

·          The Sumatera Barat plant will be under management of Semen Padang, while the other plant will not be located in Sumatera Barat due to earthquake worries. The two plants are expected to only to start to operate in 2013.

·          30% of the cost will be financed from internal cash while the other 70% will be financed externally.

·          The company stated that there has not been any final decision yet regarding its plan to acquire two cement plants in Malaysia.

·          For this year the company is expected to increase production volume by 9% YoY with a single digit growth in revenue.

·          SMGR is trading at 2011F consensus PER of 12.1x and EV/EBITDA of 8.1x.

Bank Jabar Banten sees pretax income increased by 34% YoY (BJBR, Rp1,260)

·          BJB indicated that its pretax income has increased by 34% YoY to Rp1.32tn in 2010 from Rp985bn a year earlier. The bank also said its assets increased by 35% YoY to Rp43.5tn from Rp32.41tn. BJB also managed to increase total deposits to Rp32.0tn or 35% YoY higher than a year earlier.

·          The bank’s 2010F figure may come slightly lower than the consensus expectation of Rp1.4tn with net income expectation at Rp1.1tn.

·          BJBR is trading at 2011F PER of 9.2x and PBV of 2.2x.

BW Plantation to build two mills (BWPT, Rp1,160)

·          BW Plantation plans to build two new mills, on top the company’s existing two CPO mills facilities. These new mills will cost BW Plantation US$18mn or equal to US$9mn for each mill. BW aims to commence one of those mills this year and increase its production capacity to 135 tons per hour from existing capacity of 105 tons per hour.

·          Separately, until the end of 2010, the company’s planted area reached 52,000ha and BW Plantation is targeting to plant another 10,000ha this year from its total land bank of 92,000ha.

·          To support these plans, BW Plantation allocated US$45mn of capex, which is part of the company’s growth strategy.

·          BWPT is trading at 2011F consensus PER of 16.0x and EV/EBITDA of 10.0x.

Elnusa’s revenue grew slightly higher last year (ELSA, Rp315)

·          Elnusa said its revenue grew by 9.8% YoY to Rp4.0tn in 2010 from Rp3.7tn a year earlier. The company elaborates the revenue largely came from integrated services for oil&gas, which took account for 60% to total revenue or equal to around Rp2.4tn. Furthermore, Elnusa said that more than half of this business was contributed by seismic services with revenue reached Rp1.4tn.

·          Currently, Elnusa is exploring possibilities for strategic partnership and/or joint venture with CGG Veritas for shallow sea exploration services.

·          Elnusa aims to conclude the partnership scheme in 2H11 where Elnusa expects to own majority stakes in this scheme.

Asahimas Flat Glass aims 10% YoY growth in 2011F revenue (AMFG, Rp5,050)

·          Asahimas Flat Glass (AFG) aims its revenue to reach Rp2.2tn this year, 10% YoY higher from the company’s 2010 expectation of Rp2tn. The company’s view is based on expectation that automotive market will maintain growth momentum this year.

·          However, AFG sees its cost to increase to 37% due to raw material cost. AFG has to buy silica sand, which is main material for glass, from Belitung, making it embedded with higher transportation cost.

·          AFG is optimistic it will maintain its 45% market share in domestic glass market this year, the company sees its domestic allocation will contribute equal weight with overseas market.