KLBF Apr2021

KLBF

Contact our analyst Eka

24% Upside, BUY
6th April, 2021
Price Rp 1550
Target price Rp1920

4Q2020: Record Sales

As of 4Q2020, KLBF recorded record net sales of IDR 6.02 trillion, up 3.6% YoY and 9.5% QoQ. Full year net sales slightly increased 2.1% YoY to IDR 23.1 trillion in 2020.
Distribution and logistics is the largest contributor with 37% of total sales, IDR 2.25 trillion, up +8.8% YoY.
Nutrition is next with a 30% contribution at IDR 1.81 trillion up 1.7% YoY. Pharmaceutical contributed 20% of total sales with IDR 1.21 trillion and Consumer health contributed 12% with IDR 739.9 billion.
Consumer health gross profit margin increased to 57% in 2020FY from 55% in 2019, but distribution and logistic GPM decreased to 25% from 27%. Other segments maintained their GPMs
As consumers become more aware about health, the demand for consumer health and nutrition products keeps growing.
With the positive results, we are targeting single digit growth for KLBF sales in 2021 to reach IDR 23.7 trillion.

Margin continue to Improve

KLBF maintained margins due to efficiency at the operating level.
Amid single digit sales growth, cost of revenue increased +6.2% YoY in 4Q2020 which resulted in a slightly lower gross profit -0.2% YoY to IDR 2.47 with a lower gross profit margin (GPM) of 41.1% in 4Q2020. For 2020, gross profit increased slightly to IDR 10.25 trillion with a lower GPM of 44.3% vs 45.3% in 2019.
KLBF maintained their operating margins with lower selling expenses, down by -6% YoY in 2020. Operating profit increased by +6.6% YoY to IDR 3.63 trillion with a higher operating profit margin (OPM) of 15.7% vs 15% in 2019, in line with a higher OPM in 4Q2020 up from 14.3% to 15.6%.
The net profit margin also increased slightly to 11.8% and net income grew by a single digit +9% YoY to IDR 2.73 trillion in 2020. The net profit achievement was higher than we expected, so that for 2021.
We are forecasting KLBF net profit will reach IDR 3.05 trillion, growth of +12% YoY. KLBF still maintained their margin due to efficiency at the operating level.

Valuation: BUY TP 1,920 with 24% upside

We are targeting KLBF to trade at 28x PE within a year. Target Price is IDR 1,920 which represents 24% upside. BUY

Previously

KLBF Nov2020