ICBP 2015

Company analysis 

ICBP is a part of Indofood sukses makmur Tbk, the company is producing consumer branded product which consists of noodles, Dairy, Snack food, food seasonings, nutrition and special food and beverages. In 2015 the company has launched more than 60 new products to the market.

ICBP is one of the biggest noodle producers in the world; it operates 16 factories across indonesia and one factory in Malaysia. It has 17 billion pack annual production capacity. At the same year, the company launched its new noodle product, Indomie my Noodlez and Sarimi gelas. Both of the products are created for children segment. Therefore the company increased 3 % of its production capacity in 2015.

For diary product, the company runs 6 factories across java island to produce various milk product through its subsidiary, Indolacto. It has more than 600 thousand tons annual production capacity. 

The company could increase its revenue 5,7% up in comparison with its revenue in 2014. 89 % of total sales in 2015 was contributed by noodles segment, 14.6 % was contributed by dairy segment and the remains of revenue was contributed by snack food, food seasonings, nutrition and special foods and beverage. 

The company was able to improve gross margin in 2015 compared to gross margin in 2014. Debt financing ratio (DFR) in 2015 decreased compared to DFR in 2014. The company tends to use internal source of fund to finance its capital expenditure and working capital. 

STEL.SI 2016

Company snapshot

Singapura Telecom was established in Singapore at 1879, its name was Singapore Telephone Board. At recent the company runs its operation in 25 countries. It has more than 600 million customers that comprise India, Singapore, Philippines, Thailand, Australia and 17 African countries.

In African and India, its joint venture is Bharti Air Tel Limited, this company has more than 340 million subscribers across india and African countries.  Singapore Telecom is possibly able to access data of its joint ventures in many countries including indonesia through Telkomsel. Because of that, there was issue about illegal taping of customers of Telkomsel in indonesia. 

The company is 51 % owned by Temasek Holding, a state owned company which owns various companies in Singapore and outside of Singapore.  

The company concerns in building digital segment which is focusing in three main points, it comprises digital marketing, OTT video and data analytics. They transformed from sms and voice – centric to data centric digital world.

In 2016, sales declined 1.5 % in comparison with sales in 2015. Based on its annual report 2016, the decline of sales was occurred due to revenue decrease in consumer segment. It slightly decreased 4.2 %. Meanwhile other segment, digital life and enterprise advanced compared to those two segments in 2015.

As the result of that asset turnover ratio decreased, so did return on equity. However, its net profit margin in 2016 improved in comparison with net profit margin in 2015. The weakened currency was probably as the cause of its decline. 

Therefore the company keeps in advancing the consumer segment, it plans to develop 5G technology with ericsson to develop a smart nation. It also put 800 hotspots in Singapore to allow its customer to access data service. Another service, residential fiber broadband service has been started since 2015. The capital expenditure was used to acquire new potential company and to develop IT infrastructure.

Singtel claimed as the first operator in south east asia which provides tri band LTE network using three spectrum. 

In asutaralia, optus may focus to develop video content as the main purpose, based on cisco’s visual networking index, video on demand will attain 77 % of mobile data traffic in Australia. Customer at adult age tends to use video service for communication and entertainment. 

In digital life segment, the company developed an intelligence digital marketing through amobee. This subsidiary is connected with various internet advertising such as social media, web, video and mobile. Amobee is able to optimize media strategies to increase brand awareness. 

Another digital life product is HOOQ, this is an OTT (over the top) video solution, the company cooperates with Sony Entertainment and Warner bross entertainment to provide this video service product. In order to advance innovation, the company also invested US 250 million to finance start-up companies. 

BRPT 2015

Barito Pacific was founded in 1979, its name was PT Bumi Raya Pura Mas Kalimantan. The company run various business that comprises petrochemical (Chandra asri petrochemical), property (griya idola), plantation ( royal indo mandiri),industrial timber plantation ( rimba equator permai),logging and timber manufacturing (tunggal agathis indah wood). 

Company snapshot

In 2015, almost all segment sales of the company were dropped, plantation segment was an exception. The demand of commodities at global market declined due to slower growth at global, as the result of that the price of commodities dropped. The booming of shale gas industry in USA may possibly push oil price to lower rate. 

The total sales in 2015 dropped 43 % in comparison with the total sales in 2014. Petrochemical was the suffered a biggest decline which was 44 % down. However, the decline in petrochemical was not only occurred due to slower economic growth, but it was also caused by the scheduled maintenance of naphtha cracker of petrochemical unit.  The company had been developing naphtha cracker facilities during 2015 and its project was accomplished in December. The company claimed its new naphtha cracker facilities will be able to increase its capacity 43% compared with previous facilities. Petrochemical supply was probably under its demand. 

The petrochemical segment had contribution more than 97 % of total income. On other hand, this segment was the key driver of company’s performance. 

Meanwhile, Plantation segment in 2015t grew more than 200 % in comparison with its position in 2014. It was increased by the operation of new palm oil processing mill through its subsidiary PT Tintin Boyok sawit in Sekadau, West Kalimantan. 

For the property segment, Griya Idola started to build Griya Idola Industrial Park through its subsidiary, Griya Tirta Asri. The 50 hectare industrial park is located at the western tip of Jakarta. 

In 2015 the company was able to improve its net profit from negative in to 0.4 % of total sales.  

MDKA 2015: SARATOGA’S VALUABLE INVESTMENT

 Company analysis

Merdeka copper gold tbk was established in 2012 with four subsidiaries that operates in mining project in Banyuwangi regency. Subsidiaries comprise Bumi Suksesindo, Damai Suksesindo, Cinta Bumi Suksesindo and Beta bumi suksesindo. Both Bumi suksesindo and Damai Suksesindo hold license for operation production of mining. The main business of the company is gold mining.

The location of its gold mining is located at banyuwangi regency, east java. The project was named as Tujuh bukit project.

Based on its annual report in 2015, Tujuh Bukit project is categorized as one of top world ranked undeveloped porphyry copper and gold deposits. The project comprises heap leach project and Porphyry project. The heap leach project is predicted to produce product in final quarter of 2016. It is also using open cut mining system with low stripping ratio 0,6: 1 (waste to ore ratio).

Based on its information at its web, the company claimed the heap leach project will be able to produce 97,500 oz gold per year with 9 years reserve mine life. This project is calculated capable to generate income more than USD 1 billion in 9 years with NPV more than USD 250 million

Another project, porphyry project is predicted containing 1,900 Mt @ 0.45 % cu, 0.45 g/t au and 90 g/t Mo. Its upper high grade zone is predicted containing 260 Mt with @0.8 % cu, 0.8 g/t Au and 160 g/t mo. porphyry project has more than 25 years mine life.

In 2015 the company was not producing any product yet, it has been operating its mining operation and at least it will start to produce the product at final quarter of 2016 as it mentioned at above.

Key Person

The company’s ownership is dominated by Saratoga group, Garibaldi Boy Thohir and provident group. Saratoga group is well known company in managing company that run in mining sector such as Adaro group. Mr. Edwin Soeryadjaja also hold position as vice president commissioner at Merdeka Copper Gold.

The board of commissioner is also fulfilled by mr. AM Hendropriyono, Mrs. Yenny Wahid (son of former president Gus Dur) and Mr. Boy Thohir who is also shareholder of Adaro Group and Surya Essa Perkasa.

Saratoga group is commanded by the heir of Saratoga Group, Mr. Michael Soeryadjaja who is also fulfilled position of Director at Merdeka Copper Gold. For CEO position, it has appointed Mr. Adi Ardiansyah as CEO of the company. 

CAP 2015

Company Snapshot

Slowdown in economic growth of indonesia in 2015 which stood 4.7 % decreased income of corporation in petrochemical industry segment. Chandra Asri Petrochemical as the main player in petrochemical industry experienced a decrease in its revenue. The sales volume fell due to decline in demand from the customer. The decrease of revenue was not only occurred by the dropped sales volume but it was also happening because the decline in its naphtha price in line with the decline in oil price at global market.

The net revenue in 2015 dropped -44 in comparison with net revenue in 2014. However, the company was able to improve their margin as its value chain in its business has been developed better in 2015. Net profit margin increased from 0.7 % in 2014 to 1.9 % in 2015. So did the gross margin, it increased from 7.3 % in 2014 to 15.1 % In 2015. The lower price of raw material might also advance the gross margin in 2015.

 The decline of sales was also caused by the scheduled turn around maintenance activities, the company shut down the naphtha cracker facilities for 85 days. As the result of that, the utility of the factory is not at the maximum point.

The company hired Toyo engineering to conduct cracker expansion project to produce naphtha cracker. Toyo engineering has been commencing the project since 2013. Another project was Synthetic rubber plant worth US 435 million in Cilegon, Banten. The plant will start to produce in 2018, it is a joint venture between the company and Financiere Du Groupe Michelin. 

BEST 2015

Bekasi Fajar Industrial estate (BEST) was established in 1989, the company is located at Bekasi city, west java. The company runs in industrial estate industry as its main business. It cooperated with Marubeni Corporation, foreign investment from Japan. A famous product from the company is Megalopolis Manunggal Industrial Development or MMID or MM2100.

The company also offers standard factory rental in its industrial estate area. The ultimate share holder of the company is the nin king family through its subsidiary, Argo manunggal land development with more than 48 % share. Other share holders are Hungkang Sutedja and Daiwa House industry co. ltd.

In 2015 the company allocated his fund in development of hotel and its facilities at the industrial estate area due to demand from the customer of MMID. The project is under construction in 2015 and it is expected that the project would accomplished in 2016. It is conducted by Best Sinar Nusantara and Jaya Obayashi.

In 2015 the sales of company decreased compared to sales in 2014. The decline in its sales was occurred in its sector, however the EBITDA seemed stable. The company faced negative trend in sales in the last three years. The sales of land decreased 22.1 % in 2015. The decrease in land sale was probably occurred due to the weakened economic growth, it was almost every industry declined. It was inversely happening with recurring income which comprised maintenance fee, rental fee, service charge and water service. It rose 27 % in comparison with sales in 2014.

The company is also offering golf field service, selling shop house in MM2100, selling Japanese food in Japanese restaurant and etc. The Land stock in 2015 was more than 9,662,692 Square meters which was valued more than 3.1 trillion rupiah. 

HMPS 2015

HM SAMPOERNA is market leader in cigarette industry at indonesia, this company was acquired by Phillip Morris in 2005. Michael Sampoerna as the fourth generation may probably take the decision to sell Sampoerna to Phillip Morris Indonesia due to high excise duty which tends to increase gradually at every year. He took the leadership of his family’s company since 2001.

Michael made the market surprised due its decision to sell Sampoerna to Phillip Morris Indonesia. After that Sampoerna turned its business in to others industry such as palm plantation, property, banking and entertainment at abroad.

In 2006 Sampoerna was successfully overtaking as the market leader in cigarette industry. Sampoerna has 35 % market share in indonesia, it comprises Sampoerna A (14.9 %), Dji Sam Soe (7.0%) , U mild ( 4.8%) and others. ( Source: Nielsen retail audit report )

In 2015 the company was able to sell more than 109.8 billion units. At the same year, the company was successfully generating fundraising through right issue amounted to IDR 20.77 trillion in its gross proceeds.

In Tobacco Company, the highest cost which has to concern is excise duty. It was more than 69.8 % of COGS 2015 was allocated to pay excise duty.

Net revenue of the company in 2015 increased more 10 % in comparison with net revenue in 2014. The advance of sales was contributed by tobacco segment, especially its machine-made kretek cigarette (SKM).its sales volume in 2015 was more than 70 billion units.

The company also owns subsidiary in property business, Taman Dayu. It is having agreement with Ciputra Surya for development of property. At oversea, the company has affiliation in Vietnam, Vinataba Phillip morris which is producing cigarette in Vietnam. 51 % vinataba is owned by Vietnam national tobacco corporation.