INTP 22,200

INTP

Contact our analyst Eka

HOLD
13 August 2019
Price Rp 21,400
Target price Rp 22,200

1H2019 Result: Double Digit Growth

INTP booked net revenue of IDR 6.98 trillion in 1H2019 +8% YoY with a slight increase in sales volume of 1% YoY in 1H2019 and +8% higher ASP.
INTP maintained their cost of revenue, which only slightly increased 1% YoY. As a result, gross profit grew double digit 26% YoY to IDR 2.14 trillion from IDR 1.70 trillion in 1H2018. Fuel and power cost per ton also decreased by -9% YoY from lower oil and coal prices. Gross profit margin improved from 26.2% in 1H2018 to 30.7% in 1H2019.
Operating profit rose sharply +132% YoY to IDR 590.2 billion from IDR 254.7 billion. As a result the operating profit margin was higher at 8.5% from 3.9% in 1H2018.
INTP booked a bottom line profit of IDR 640 billion, up 80% YoY from IDR 355.1 billion in 1H2018. Net profit margin also improved from 5.5% to 9.2%.
We upgrade our 2019F forecast because of higher-than-expected 1H2019 results. We now expect INTP’s bottom line will grow +31% in 2019F to IDR 1.49 trillion inline with a better ASP, higher sales volume, and well managed fixed costs.

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Higher cement sales growth compared to Industry

INTP sales volume growth in January-June 2019 was higher than Industry domestic sales volume. 1H2019, INTP total sales volume was 8.4 million tons (mt) up 1% compared to 1H2018, while Industry domestic sales volume of 29.37 million tons was negative growth of -2.3% YoY.
INTP market share slightly increased from 26.2% to 26.3%.
We expect the second semester this year will see a stronger cement market from seasonality and as a result of investors wait-see position turning to action after the Government recently stated their commitment to continuing infrastructure and development projects.

Valuation: Hold with TP 22,200

Previously

March 2019