LIVE

Contact our analyst Eka

45% potential Upside, BUY 
12 February 2025
Price Rp 200
Target price Rp290

• Increased Product Launches at Inspired Home & Living Show
• LIVE hosted the Inspired Home & Living Show (IHLS) in October 2024, a bazaar and private expo featuring household products. During IHLS 2024, the company launched several new products across different categories, including:
  •    Klen – Dustbin collections
  •   Big Block – Lunch sets
  •   T+ Active – Water bottle tumblers  
  •   Maamo – Cutlery and children’s blankets
  •   KEI Living – Cutlery supplies   
  •   Lungo – Lunch kits, bags, and luggage
• This event boosted LIVE’s sales, contributing up to 15% of total revenue.
• Moving forward, the company plans to expand through acquisitions and explore potential joint ventures.
• Additionally, LIVE will increase the frequency of events like IHLS to strengthen brand awareness, maintain relationships with partners, and drive sales growth.

Sustained Top-Line Growth

• LIVE reported positive sales growth in Q3 2024, with revenue increasing 8.8% YoY and 3.3% QoQ to IDR 59.27 billion.   
• The trading segment grew significantly by 47.0% YoY to IDR 38.7 billion, remaining the largest revenue contributor at 60.1% of total revenue in Q3 2024.
• The manufacturing segment declined by 22.3% YoY to IDR 25.62 billion in the same period.
• For the first nine months of 2024 (9M2024), LIVE’s total revenue increased by 17.0% YoY to IDR 184.9 billion:
• Manufacturing segment revenue surged by 80% YoY to IDR 76 billion.   
• Trading segment revenue grew by 5.1% YoY to IDR 127.4 billion.

Live also reported strong margin Improvements:

• The EBIT margin for the trading segment improved to 17.6% in 9M2024, up from 13.3% in 9M2023.   
• The manufacturing segment’s EBIT margin improved from -5.6% to -1.6%.We anticipate higher Q4 2024 sales, driven by the IHLS event in October, and moderate growth in 2025, with revenue projected to reach IDR 326 billion.

Margin Expansion

• LIVE’s bottom-line performance showed substantial improvement: 
• Q3 2024 net profit reached IDR 1.46 billion.
• 9M2024 net profit surged 48.8% YoY to IDR 21.2 billion, with a net profit        margin of 11.5%.

Cost of goods sold (COGS) decreased 1.0% YoY to IDR 92.7 billion in 9M2024, resulting in:  

•  Gross profit growth of 43.1% YoY to IDR 92.2 billion.
•  Gross margin expansion to 49.9% in 9M2024.
•   Operating profit growth of 61.8% YoY to IDR 35.5 billion, with an operating   margin of 19.2%.

Valuation

• Our DCF valuation, using a WACC of 10.56%, yields a target price of IDR 290, implying a 45% upside. This equates to a target P/E ratio of 30x, compared to the industry average of 37x. Recommendation: BUY
  

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