BTPS
Contact our analyst Lingga
13% upside. HOLD.
5th January, 2021
Price Rp3930
Target price Rp4420
BTPS 9M20 Performance
9M20 net profit increased on a quarterly basis, up +41% but was still down -15% YoY, due to the high amount of restructured financing. 9M20 net revenue, decreased 10% YoY to IDR 2.5 trillion. After some operating expense savings, PPOP fell a lesser 5.7% YoY. NIM was down 6.4% YoY.
Asset Quality declined
Gross NPLs increased by 1.9%. due to an unavoidable decline in asset quality, especially for the MSME segment. BTPS has been rescheduling monthly instalments for most of the affected borrowers. BTPS believes that business conditions have improved but not yet fully recovered.
Restructured Loans
Restructured financing has only amounted to 20% of total financing. However, most customers have received assistance from the government's economic recovery program & we expect that there will now be a reduction in the need for restructuring.
Positive loan growth
Increased loan growth has been driven by customers which received additional financing. BTPS will now get new loan growth from returning customers based mostly in Java, 60%, and in the ex-Java green areas, 35%. The plan is to grow loans selectively.
Valuation: 13% Upside, Hold
Based on our DDM Valuation, we have a target price within one year of IDR 4420, or trading at 3.6x PBV which gives 12% potential upside, Hold.
9M20 net profit increased on a quarterly basis, up +41% but was still down -15% YoY, due to the high amount of restructured financing. 9M20 net revenue, decreased 10% YoY to IDR 2.5 trillion. After some operating expense savings, PPOP fell a lesser 5.7% YoY. NIM was down 6.4% YoY.
Asset Quality declined
Gross NPLs increased by 1.9%. due to an unavoidable decline in asset quality, especially for the MSME segment. BTPS has been rescheduling monthly instalments for most of the affected borrowers. BTPS believes that business conditions have improved but not yet fully recovered.
Restructured Loans
Restructured financing has only amounted to 20% of total financing. However, most customers have received assistance from the government's economic recovery program & we expect that there will now be a reduction in the need for restructuring.
Positive loan growth
Increased loan growth has been driven by customers which received additional financing. BTPS will now get new loan growth from returning customers based mostly in Java, 60%, and in the ex-Java green areas, 35%. The plan is to grow loans selectively.
Valuation: 13% Upside, Hold
Based on our DDM Valuation, we have a target price within one year of IDR 4420, or trading at 3.6x PBV which gives 12% potential upside, Hold.
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