NISP Sekuritas Daily 18 Jan 2011 (Economy, UNTR, KRAS, HEXA, KBLV, CSAP)

Moody's upgrades Indonesia 's sovereign ratings to Ba1 (Economy)
·                      Moody's Investors Service has today concluded its rating review, which was initiated on December 1, 2010, and upgraded the Indonesian government's foreign and local-currency bond ratings to Ba1, from Ba2.
·                      Moody's had placed Indonesia 's Ba2 sovereign ratings on review for possible upgrade in December 2010. Factors behind the latest upgrade are Indonesia ’s economic resilience, government debt position, and increasing foreign reserves, and outlook for foreign direct investment.
·                      This makes Indonesia one notch below investment grade according to Moody and Fitch, while still 2 notches below investment grade by S&P methodology.
 
United Tractors targets sales volume to increase by 10% YoY (UNTR, Rp22,600, Hold)
·                      United Tractors targets sales volume to increase by 10% YoY to 6,000 units from previously 5,404 units in 2010. Sales volume in 2010 jumped by 73.7% YoY from only 3,111 units in 2009.
·                      Sales are still dominated by equipment for mining followed for plantation purposes.
·                      The company will release its operational data in the near future including for subsidiary Pamapersada Nusantara.
·                      UNTR is trading at 2011F PER of 15.2x and EV/EBITDA of 8.0x.

Krakatau Steel targets 11%-15% YoY growth (KRAS, Rp1,160)
·                      Krakatau Steel is looking for 11%-15% YoY growth this year, from the Rp18-19tn projected for 2010, to Rp20-21tn this year. The company is allocating capex for this year between Rp3-5tn, mostly to increase its power plant capacity by 120 MW as part of its plan to increase a total of 180 MW to its 400 MW power plant in the upcoming 2 years. In addition it will also build 2 new blast furnace plants this year. This capex does not include capex of Latinusa (NIKL, Rp405).
·                      This target is backed from estimate that coking coal price will increase 30% YoY this year while steel selling price will increase by 15%-23%. Steel price is expected to rise from the increase of raw material prices which is affected by delayed production in Australia and Brazil as well as increasing oil price. 
·                      Domestic steel consumption is assumed to rise by 20% YoY to 8.09mn tons in 2011 and 8.85 mn tons in 2012 from 2010 figure of 7.42mn ton. The company targets production volume to grow by 15% YoY to 2.1-2.2mn tons this year.
 
Hexindo Adiperkasa estimates performance until March 2011 to increase by 17% YoY (HEXA, Rp6,900)
·                      Hexindo Adiperkasa estimates that net income from April 2010-March 2011 will pas U$40mn or up by 17% YoY from the previous budget year of US$34mn. Revenue is projected to increase by 47% YoY to US$500mn from US$340mn, backed by increased sales volume from 1,600 units to 2,300 units.
·                      Management expects the upcoming year to still be a booming market and targets sales volume to reach 3,0000 units while revenue is targeted to increase by 30% YoY to US$650mn.
·                      A total of US$3-4mn is prepared for capex this year, which is financed by internal cash. The capex fund will be used for maintenance as well as opening new branches.
·                      HEXA is trading at 2012F consensus PER of 11.7x and EV/EBITDA of 8.1x.


Lippo reported will divest First Media (KBLV, Rp970)
·                      It is reported by Wall Street Journal that the Lippo Group is planning to divest its stake in First Media, and targeting to raise US$600-800mn from the sale of 55.1% First Media Shares.
·                      Management could not be contacted however the company’s corporate secretary shared that the company has held a meeting last night related to the divestment process and the company will disclose the information in one week.
 
Catur Sentosa targets Rp4tn sales (CSAP, Rp95)
·                      Catur Sentosa is targeting revenue this year to reach Rp4tn up from 2010E figure of Rp.3.3tn. While 2010 net income is expected to reach Rp35bn from Rp11bn in 2009.
·                      The company is optimistic on this target as cement consumption this year is expected to grow by 10% YoY driving sales for home supplies, and also good sales for ceramic sales.
·                      The company will open one new outlet in Jakarta Barat financed from capex of Rp30-40bn.
·                      In addition the company has also been appointed as distributor fro P&G products in Jakarta , Depok, Tangerang.