TINS
Contact our analyst Revita
18% upside, HOLD
17th November 2020
Current price Rp1055
Target price Rp1255
17th November 2020
Current price Rp1055
Target price Rp1255
Production target on track
As of 9M20, TINS recorded tin ore production of 34,592 tons, down 47.44% yoy. About, 74.56% came from in land mining, while the remaining 25.44% came from offshore mining. Tin metal production was 37,588 tons, minus 35.37% yoy. Sales of tin metal were 45,548 tons down 9.49% yoy. The average selling price of tin metal was USD16,832 down by 11.8% yoy. As we previously mentioned, In 2020F, TINS is targeting lower tin ore production volume of 55k tons or -33% yoy and expects lower tin prices as demand is still weak, affected by the spread of the corona virus. But the vaccine trials in several countries have brought hope for the recovery of metal markets. TINS recorded exports of 98%, while the rest was for the domestic market. Tins export destinations up to 9M 2020 are Asia 68%, Europe 15% and America 15%. We maintain our estimated production and sales volume targets as in our prior report.
Ausmelt Furnace progress
The ausmelt furnace smelter project located in Muntok Bangka Barat, has reached 30.5% overall completion with a capacity target of 40000 MT / year crude tin. Construction of this project has been going on for 8 months with a target of completion in another 16 months, which is January 2022. In addition to Ausmelt, TINS is also working on rare earth projects. Currently, the company is looking for strategic partners to work on the project.
Continued higher efficiencies
TINS is on track to improve cash flow to maintain the health of finances and reduce interest expenses. During 9M20, TINS de ‐ leveraged to reduce interest payments, and re ‐ profiled bank loan payment schedules for both currencies. As a result, In 9M2020, operating cashflow amounted to Rp 4.84 trillion, up from Rp 3.17 trillion in 1H20. TINS has been able to pay down some of its short-term liabilities and bond debt. The short-term bank debt position of Rp 4.74 trillion has decreased by 46% compared to 8.79 trillion last year. Going forward, TINS will continue to reduce bank loans, continue to explore for resources and focus on technology development.
Valuation: 18% upside
We have a target price for TINS within one year of IDR. 1255 / share or trading at 52xPER, or 18% upside. Our recommendation is HOLD.
As of 9M20, TINS recorded tin ore production of 34,592 tons, down 47.44% yoy. About, 74.56% came from in land mining, while the remaining 25.44% came from offshore mining. Tin metal production was 37,588 tons, minus 35.37% yoy. Sales of tin metal were 45,548 tons down 9.49% yoy. The average selling price of tin metal was USD16,832 down by 11.8% yoy. As we previously mentioned, In 2020F, TINS is targeting lower tin ore production volume of 55k tons or -33% yoy and expects lower tin prices as demand is still weak, affected by the spread of the corona virus. But the vaccine trials in several countries have brought hope for the recovery of metal markets. TINS recorded exports of 98%, while the rest was for the domestic market. Tins export destinations up to 9M 2020 are Asia 68%, Europe 15% and America 15%. We maintain our estimated production and sales volume targets as in our prior report.
Ausmelt Furnace progress
The ausmelt furnace smelter project located in Muntok Bangka Barat, has reached 30.5% overall completion with a capacity target of 40000 MT / year crude tin. Construction of this project has been going on for 8 months with a target of completion in another 16 months, which is January 2022. In addition to Ausmelt, TINS is also working on rare earth projects. Currently, the company is looking for strategic partners to work on the project.
Continued higher efficiencies
TINS is on track to improve cash flow to maintain the health of finances and reduce interest expenses. During 9M20, TINS de ‐ leveraged to reduce interest payments, and re ‐ profiled bank loan payment schedules for both currencies. As a result, In 9M2020, operating cashflow amounted to Rp 4.84 trillion, up from Rp 3.17 trillion in 1H20. TINS has been able to pay down some of its short-term liabilities and bond debt. The short-term bank debt position of Rp 4.74 trillion has decreased by 46% compared to 8.79 trillion last year. Going forward, TINS will continue to reduce bank loans, continue to explore for resources and focus on technology development.
Valuation: 18% upside
We have a target price for TINS within one year of IDR. 1255 / share or trading at 52xPER, or 18% upside. Our recommendation is HOLD.
Previously
tins_19_march_2018.pdf |
tins_18_january_2018.pdf |
tins_7_december_2017.pdf |
tins_9_october_2017_.pdf |