SIDO
Contact our analyst Eka
20% upside, BUY
16th February 2023
Price Rp 870
Target price Rp 1040
16th February 2023
Price Rp 870
Target price Rp 1040
Herbal & Supplement margin higher
- In 4Q2022, SIDO sales increased +25% QoQ or +0.58% YoY to IDR 1.25 trillion. Higher quarterly sales were boosted by sales from herbal & supplements during the holiday and high rainfall season. For 2022, SIDO sales reached IDR 3.86 trillion which is a decrease of -4% YoY after a decline in 2Q2022.
- Herbal & supplement sales record a strong increase of +45.2% QoQ or +5.5% YoY to IDR 667.6 billion due to higher demand. The herbal & supplement margin was higher at 70.2% due to higher sales volume and stable raw material prices.
- F&B sales declined -17.3% QoQ or -15.3% YoY to IDR 246.3 billion in 4Q2022 due to lower demand for Vit C1000 products. But the F&B margin showed improvement from 27% in 3Q2022 to 30.6% in 4Q2022 as several raw materials prices have started to decline.
- Pharmacy sales were flat, +0.77% YoY to IDR 28.3 billion in 4Q2022 with a lower margin of 27.7%.
- Online sales maintained higher growth of +170% YoY in 2022, and the contribution to total sales increased to 2.5% in 2022 from 1% in 2021.
- With the demand rebound continuing in 4Q2022, we now expect SIDO top line in 2023F to reach IDR 4.23 trillion or +10% growth.
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4Q2022 Result: Rebound continue
Valuation: BUY with TP 1.040
- After a decline in 2Q2022, SIDO continued to rebound in 4Q2022. SIDO net profit was IDR 384 billion, up by +40% QoQ but still lower -2.8% YoY with a higher QoQ NPM of 30.7% compared to 3Q2022’s 27.4%. For 2022, SIDO net profit still decreased by -12% YoY to IDR 1.51 trillion with a higher margin compared to pre-covid at 29%.
- Operating profit margins also increased QoQ to 38.9% in 4Q2022.
- Gross profit increased +43% QoQ or +6.2% YoY to IDR 769 billion in 4Q2022 with a higher GPM of 61.4% from 58.2% in 4Q2021 from lower costs of sales, -7.3% YoY.
- As performance continues to improve, we are now expecting SIDO profit to reach IDR 1.6 trillion for 2023F or +12% growth.
Valuation: BUY with TP 1.040
- we maintain our recommendation to BUY. We are targeting SIDO to reach IDR 1.040 or 20% upside, which is a 23x PE valuation within one year. BUY.
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