PTBA
Contact our analyst Revita
significant upside, BUY
6th June 2023
Price Rp3150
Target price Rp5820
6th June 2023
Price Rp3150
Target price Rp5820
Targetting 41 mn tons coal production
In 1Q23, PTBA produced 6.8 million tons of coal, a 7% YoY increase from the same period in 2022. This production increase was in line with a 59% YoY increase in export sales volume, which reached 3.6 million tons. Additionally, the company achieved a 10% YoY growth in its Domestic Market Obligation (DMO) with 5.2 million tons of coal sold. PTBA aims to produce 41 million tons of coal in 2023, an 11% YoY increase from the 2022 realization of 37.1 million tons. The stripping ratio (SR) for 1Q23 rose to 7.1x due to production optimization efforts in the Banko Area, which holds the highest amount of coal reserves and can therefore help to boost production. PTBA also plans to bring its new transportation infrastructure to full capacity in 2023 since it has been fully operational since the end of 2021. Our estimate for 2023F coal production volume is 40.8 million tons, in line with the company's guidance, representing a 10% YoY increase..
1Q23 revenue increased 21% YoY
PTBA's revenue for 1Q23 reached Rp. 10.0 trillion, a 21% YoY increase, due to high export sales volume. The average selling price (ASP) in 1Q23 was IDR 11 million/ton, similar to the previous period. Net profit was IDR 1.2 trillion, which is a lower 12% net profit margin, due to increase in several costs. We estimate the bottom line profit for this year will be slightly lower than last year due to our forecast of a lower selling price.
Going downstream
In line with its vision to expand into the new renewable energy sector, PTBA signed a Memorandum of Understanding (MoU) with HDF Energy on April 17, 2023. HDF Energy is a company that specializes in renewable energy, including Hydrogen Fuel. The two companies are exploring collaboration in developing large-scale hydrogen fuel infrastructure in PTBA's operational areas to reduce carbon emissions. This initiative will reduce PTBA's dependence on coal in the future to meet the company's revenue goals.
Valuation: significant upside potential
We maintain our target price for PTBA at IDR 5,820, which is a valuation of 6.5x PER. With significant upside potential, we recommend a BUY.
In 1Q23, PTBA produced 6.8 million tons of coal, a 7% YoY increase from the same period in 2022. This production increase was in line with a 59% YoY increase in export sales volume, which reached 3.6 million tons. Additionally, the company achieved a 10% YoY growth in its Domestic Market Obligation (DMO) with 5.2 million tons of coal sold. PTBA aims to produce 41 million tons of coal in 2023, an 11% YoY increase from the 2022 realization of 37.1 million tons. The stripping ratio (SR) for 1Q23 rose to 7.1x due to production optimization efforts in the Banko Area, which holds the highest amount of coal reserves and can therefore help to boost production. PTBA also plans to bring its new transportation infrastructure to full capacity in 2023 since it has been fully operational since the end of 2021. Our estimate for 2023F coal production volume is 40.8 million tons, in line with the company's guidance, representing a 10% YoY increase..
1Q23 revenue increased 21% YoY
PTBA's revenue for 1Q23 reached Rp. 10.0 trillion, a 21% YoY increase, due to high export sales volume. The average selling price (ASP) in 1Q23 was IDR 11 million/ton, similar to the previous period. Net profit was IDR 1.2 trillion, which is a lower 12% net profit margin, due to increase in several costs. We estimate the bottom line profit for this year will be slightly lower than last year due to our forecast of a lower selling price.
Going downstream
In line with its vision to expand into the new renewable energy sector, PTBA signed a Memorandum of Understanding (MoU) with HDF Energy on April 17, 2023. HDF Energy is a company that specializes in renewable energy, including Hydrogen Fuel. The two companies are exploring collaboration in developing large-scale hydrogen fuel infrastructure in PTBA's operational areas to reduce carbon emissions. This initiative will reduce PTBA's dependence on coal in the future to meet the company's revenue goals.
Valuation: significant upside potential
We maintain our target price for PTBA at IDR 5,820, which is a valuation of 6.5x PER. With significant upside potential, we recommend a BUY.
Previously