BNBR 2015

Company analysis

Bakrie & brothers is established in 1951, its former name was NV Bakrie & Brothers. The company is engaged in various businesses such as construction, steel pipe manufacturing, construction product and etc.

Bakrie & Brothers is owned the bakrie family; one of tycoons in indonesia, Bakrie is also having other business such as media, energy and telecommunication. Aburizal Bakrie, the leader of Bakrie group is a politician of Golkar party.

In 2012 Bakrie and Brothers has divested its ownership in Bumi Plc, parent company of Bumi resources. As the result of that its total asset declined from IDR 15,658 billion in to IDR 11,878 billion in 2012, the decline was caused by the decline in its non-current asset from IDR 8268 billion in to IDR 4575 billion. The decline in non-current asset decreased net revenue significantly in 2012.

In  2015 Bakrie auto parts, the subsidiary of Bakrie & Brothers is qualified as Global auto parts supplier of Mitsubishi Fuso – Daimler. This advancement is probably able to increase net revenue in the future. It would export the auto part product Mitsubishi factories at oversea. Bakrie auto part is related with Krama Yuda Tiga Berlian and Mitsubishi Krama Yuda.

In 2015, the net revenue declined more than 26 % in comparison with net revenue in 2014. As the result of that the net profit dropped in significant number. The drop in net profit was not only occurred because of dropped revenue but it was also happened because of provision cost in 2015. The company posted provision amounted to IDR 968 billion. The net profit decreased from IDR 151 billion in 2014 in to IDR -1,7 trillion in 2015.

This provision was charged for its short term investment.  The provision for impairment loss decreased its short term investment from IDR 2.588 billion in 2014 to IDR 438 billion in 2015. If the provision is added back to its net profit, the loss was at around IDR 751 billion.

More than 81 percent of total revenue in 2015 was contributed by Infrastructure & manufacturing segment. Its segment comprises infrastructure, manufacturing and trading, services and investment. Its mining segment has been separated from its consolidated financial statement.

Bakrie Global Group

Bakrie Global group which is controlled by Aburizal Bakrie, it has been investing in Path, social media platform that was established in Silicon Valley. Their investment in 2014 was amounted to USD 25 millions. Dave morin, CEO of path, was visiting Jakarta to meet with his new investor. According to mortin, there are 4 million users of path in indonesia, they have significant influence in path.

Bakrie group argued that the investment will make Indonesians more connected and productive as their assertment in their twitter. The investment possibly used to create application in path. Another social media, facebook, has already had many applications in its platform.

Matahari Departemen store (LPPF) 2015

Retail industry

Modern retail in indonesia is low in its penetration compared to other countries in south east asia. Two indicators that show the low penetration are percentage of modern retail to total retail. It is only 17 % of total retail sales, in Philippines, Malaysia, Thailand and Singapore, percentage of modern retail to total retail sales are higher than indonesia. Then, the second indicator, the retail space in indonesia is smaller which is only 11,000 square meters per million people in 2015. In Philippines and Thailand, the retail spaces are 22,000 square meters per million people and 34,000 square meters per million people, respectively.

Conclusion, the modern retail industry in indonesia is possibly still under its potential demand.

Company analysis

In 2015, Matahari department store increased its stores from 131 stores in 2014 to 142 stores. Its total store area in 2015 became 931,700 square metres at 66 cities across indonesia. Matahari department store is affiliated with Matahari putra prima Tbk. Its ultimate shareholder is Multipolar that has 20.48 % shares. Another share holder is Asia Color Company Ltd with 2 % shares.

the expansion was done because indonesia has good potential for retail growth. Based on euromonitor, indonesia is one of five emerging markets with best middle income potential. Indonesia has fourth largest middle income segment

As a market leader in department store segment, the company attained 42.8 % of total market share in indonesia in 2015. At the same year it got 3,2 million active member of MCC (matahari club card). MCC is its customer loyalty program, the company endeavors to engage its customer in purpose to advance customer spending in purchasing stuffs at its store.

In 2015, in order to increase its revenue, the company signed agreement with Matahari Mall, its affiliated company, in selling product through internet. At further step, the company has purchased share option at 10 % of total share of Global Ecommerce Indonesia (GEI) which is a parent company of Matahari Mall. This strategy was in line with the recent trend, customer start to purchase product through internet.

The company was able to increase net revenue 13.6 % up at 2015 in comparison with net revenue in 2014. More than 64 % of total sales in 2015 was contributed by consignment segment. It argues that the exclusive brand was as the key success factor to get high growth in revenue. Besides, it was able to improve its profit margin from 17.91 % n 2014 to 19.7 % in 2015. Therefore, its ROA increased in 2015. 

AMTR 2015

Company Analysis

In 2015 the company has developed more than 11,000 units across indonesia and oversea. Among of the units are located at greater Jakarta, more than 37 % of total units.  For oversea operation, the company has started to build store at Singapore, Malaysia, Philippines and etc.

The unit consists of moko (mobil toko, alfamart, alfa midi, alfa express, Lawson and etc. Alfamart as the biggest part of its business, it separates its business in two type of product, it comprises food product and non food product. They allocated 70 % for food product and 30 % for non food product at each alfamart.

The company also runs another business in medical, beauty and healthcare and etc. based on its annual report the company used model of community store in operating its business.

In 2015, the company developed virtual store, the first virtual store in indonesia, it is called as alfa mind. It allows everyone to participate as either supplier or store owner. The company claimed that alfamind was able to advance income for the company in 2015.

The additional 1200 units store in 2015 and implementation of alfamind were able to increase revenue 16.3 % in comparison with revenue in 2014. The double digit growth is an indication of the right strategy from the company in 2015.

In 2015 the net profit decline as the increase of loan utilization. It increased interest expense at that year, as a result of that the net profit dropped. The company may possibly need more fund to finance its expansion, it paid prepaid rent for opening thousands of new store in 2015. Another expenditure was building platform of alfamind as the explanation at above.

SMBR 2015

The company was established in November 14, 1974 at Palembang, South Sumatera. PT Semen Baturaja is state cement company, government of indonesia has 76.24 % and the rest is owned public. The company is producing various cement including ordinary Portland cement and Portland composite cement. The company has done its IPO at march 14, 2013 at indonesia stock exchange.

The company runs three plants at panjang, Palembang and baturaja at south sumatera. It derived the raw material, clay and limestone from at around baturaja plant. So does its silica sand, it is derived from the third party at around baturaja plant.

For advancing its growth, the company has been starting the development of new factory to produce cement. It cooperates with Sinoma group to build Baturaja II plant. The new plant is scheduled accomplished at 2017. It is expected able to produce 1,850 thousand tons annually. And for the future, the company plans to establish baturaja III plant. It would start feasibility study of baturaja III plant.

In 2015 the company was able to advance its revenue 20.3 % higher compared to sales in 2014. The revenue was dominated from sales of sales of bagging cement to third party, its sales of bagging cement was 62.5 % of total sales in 2015. The remains was derived from revenue of bulk cement. It also improved its gross profit margin from 38.2 % in 2014 to 39.6 % in 2015.

As a state owned company, it cooperates with other state company such as Bukit Asam persero for coal purchase, Kereta Api Indonesia persero for railway service and etc.

PWON 2015

Company analysis

Pakuwon Jati as one of largest property company in indonesia, it continues in expanding its business in capturing demand from customer in its purpose to win the competition in property segment. Competitors in property industry are Agung Podomoro Land, Ciputra, Lippo Karawaci,Alam Sutera and etc.

In 2015 economic growth of indonesia was around 4.7 %, it was beneath the government target, 5 %. The slowdown of economic growth was influenced by low consumption and low price of commodities which was dominating export sector. Domestic consumption growth was improved in third quarter of 2015; it was at 4.53 % (yoy).

Central Bank also has loan to value regulation that was possibly not friendly to investor who invested in property as investment. Higher interest expense also tends to decrease demand of real estate.

 In October 2014 the company acquired PT Pakuwon Permai, its asset and revenue are consolidated to company’s financial statement. As the result of that recurring income of the company increased significantly as the additional asset that comprises Blok M Plaza, Supermal Pakuwon Indah, Royal Plaza and Somerset Berlian.  

In 2015 the company was also operating new hotel at its Gandaria city, Sheraton grand Jakarta. It strengthened its income from hospitality segment.

In 2015 its total sales increased more than 19 %, it comprised 46 % shopping center and office, 3.4 % hospitality and 49.9 % residential sales. The occupancy of its hotel in 2015 declined more than 3 %, despite it was able to increase its shopping center and office at round 29 % and its residential segment at more than 10 %.

ADRO 2015

Company analysis

Adaro is an integrated energy company that has integrated business in coal mining, mining services and logistics and power plant.

The company is implemented pit-to-power business model; it has subsidiaries which are located in pit-to-power value chain from mining location to its power plant location. Its subsidiaries run in related businesses such as barging, ship loading, dredging, port services and marketing.

The company branded its sub bituminous coal product with name of envirocoal, the coal which is claimed containing low sulphur, low ash and low nitrogen. So does its mining location, the company built mining which is friendly to the environment. The company implemented green energy concept in his energy business.

Based on its annual report the company focused in power plant business as the coal price at commodity market dropped due to lower demand of coal. However, based on wood Mackenzie predicted that the coal price will soar, the average global coal Newcastle price will reach at USD 53 per ton in 2016 and USD 54 per ton in 2017.

The power plant used new technology of coal power plant, it is called circulating fluidized bed. Its subsidiaries, Makmur Sejahtera Wisesa used this technology to generate 2 x 30 MW power plant.

On other hand, in 2015 the company has been developing its new power plant through its subsidiary, Bhimasena Power Indonesia. it is expected able to generate 2 x ,1000 MW. This company would use ultra supercritical boiler technology in its power plant.

May be, Adaro wants to produce more energy from coal as its main energy resources through its power plant. This is in line with government program that sets to build many power plants as energy supply is under its demand.

During period of 2011-2015, the net revenue of the company tends to decline gradually, its CAGR of net revenue in the period is -9.4 %. It is occurred due to negative trend in coal price at global commodity market at the same year. The sales volume during the same period is still slightly growing, its CAGR is at 1.1 %in during period of 2011-2015.

Sales volume in 2015 declined 6.8 % in comparison to its sales volume in 2014. Whereas, net revenue in 2015 declined 19 % compared to net revenue in 2014.

PBRX 2015

 Company Analysis

Pan Brothers was established in 1980, the company and its subsidiaries run its business as manufacture of woven garment, jacket and cut and sewn knit garments. It also runs in retail business through its subsidiaries.

The majority of the product was commonly exported to over sea such as United stated of America, European Community, Eastern Europe, Canada, Australia and etc. more than 80 % of total revenue was contributed from export revenue.

The world class branded product of apparel usually hands its production of the product over to third party as manufacturer. Besides, Pan brothers also established joint venture with the global player in garment industry.

In order to strengthen its position in garment industry, the company has joint venture with Mitsubishi Corporation in Boyolali, it is Eco Smart Garment Indonesia. This company is a garment manufacture for Mitsubishi buyer. Another its joint venture company is located in Hongkong, Cosmic Gear Ltd, an apparel buying agent and product development company.

Ocean Asia industry, one of its subsidiaries, is supplier for many world class brands such as H&M, Gap, Walt Disney, Target and etc.

On other hand, the company is also participating in retail business through Apparelindo Mitra Andalan which trades Zoe. Another retail company is Mitra Busana Sentosa which sells S n P, asylum and FTL.

The company has also been appointed as supplier for reputable world class brand such as Adidas, Nike, Hugo Boss,Yonex, Puma, Calvin Klein and etc.

In 2015, the company’s total revenue increased 23.6 % in comparison with total revenue in 2014. Based on its annual report, its majority of its revenue growth was contributed by highest sales growth in local segment. Its local revenue in 2015 increased 95 % compared to local revenue in 2014. Its local garment sales advanced more than 200 %.

High growth revenue in local market in 2015 was possibly occurred due to new manufacture operation, Pancaprima Ekabrothers and Ecosmart Garment indonesia purchased new fixed asset in 2015. Might be, it increased production capacity of production for local market. The company’s fixed asset also increased 62 % compared to its fixed asset in 2014.

In 2015 the company was able to improve its gross margin to 15.1 %. Net profit margin slightly decreased to 2.1 %, the higher interest expense declined its net profit margin. Howe ever, its asset turnover was improved to 94.5 %.