ICBP Aug2025

ICBP

Contact our analyst Eka

Buy, 36% upside
29th August 2025
Price Rp 9,300
Target price Rp 12,700

Higher Raw Material Costs

ICBP booked modest sales growth of +2.2% YoY but a -13.7% QoQ decline in Q2-2025, reaching IDR 17.41 trillion, supported by volume growth in noodles, snack food, and nutrition & special foods. For 1H-2025, sales rose +1.7% YoY to IDR 37.6 trillion.
Domestic sales contribution slipped slightly to 70.6% (vs. 71.6% in 1H-2024) but remained dominant at IDR 26.58 trillion. Exports to the Middle East and Africa grew +2.3% YoY to IDR 9.7 trillion, while sales to Other Asia surged +30.5% YoY to IDR 1.32 trillion.
Noodles: Revenue grew +3.6% YoY but fell -12.3% QoQ to IDR 13.07 trillion in Q2. For 1H-2025, revenue increased +2.5% to IDR 27.98 trillion with +4% YoY volume growth. EBIT margin contracted to 23.3% (from 26.5%) due to higher cooking oil prices.
Dairy: Sales declined -4.3% YoY and -20.1% QoQ to IDR 2.17 trillion in Q2, and fell -2.9% YoY to IDR 4.89 trillion in 1H-2025, driven by a -3% volume drop amid intense competition. EBIT margin fell sharply to 3.2% (from 9.1%).
Food Seasonings: Revenue rose +7.9% YoY but fell -23.8% QoQ to IDR 1.05 trillion in Q2, and increased +6.5% YoY to IDR 2.42 trillion in 1H-2025. EBIT margin improved to 18.4% (vs. 12.9%).
Beverages: Sales contracted -11.5% YoY to IDR 370 billion, with 1H-2025 down -12.1% YoY to IDR 742 billion. Volume declined -8% YoY. EBIT margin edged down to 13.6% (vs. 14.0%).
Nutrition & Special Foods: Revenue declined -9.2% YoY and -21.3% QoQ to IDR 284 billion in Q2. For 1H-2025, sales were flat at IDR 645 billion, with +4% volume growth and an EBIT margin of 8%.
Snack Foods: Revenue grew +2.7% YoY to IDR 1.13 trillion in Q2 and +3.3% YoY to IDR 2.33 trillion in 1H-2025, with +2% volume growth, though EBIT margin slipped to 6.7% due to higher raw material costs.
Looking ahead, higher cooking oil prices will weigh on margins, particularly in noodles. However, ICBP has historically been able to pass on rising raw material costs through ASP adjustments.

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Q2 2025 Results: Maintain Strong bottom line Recovery

ICBP’s net profit surged +142.7% YoY to IDR 2.87 trillion in Q2-2025, mainly due to lower forex losses, though core profit declined -3.7% YoY and -25.5% QoQ to IDR 2.29 trillion.
Gross Profit: IDR 5.83 trillion, down -8.7% YoY and -20.1% QoQ, with GPM contracting to 33.5% (from 37.5%). This was driven by +8.7% YoY higher COGS, reflecting +0.4% YoY raw material costs and +4% YoY production expenses.
Operating Profit: Declined -16.4% YoY and -35.5% QoQ to IDR 3.32 trillion, with OPM at 19.1% (vs. 23.3% in Q2-2024).
Forex Impact: ICBP recorded a forex gain of IDR 951 billion in Q2-2025 versus a forex loss of IDR 1.55 trillion in Q2-2024, significantly boosting net profit

Valuation: Maintained Buy with TP IDR 12,700

We maintain our BUY recommendation on ICBP with a target price of IDR 12,700, implying +36% upside. This valuation is based on a 13x forward PE, supported by:
- Solid volume growth in noodles and selected categories.
- Margin recovery supported by ASP adjustments.
- Reduced forex pressures compared to last year.

Previously