TINS
Contact our analyst Revita
-2% Sell
14 November, 2023
Current price Rp 645
Target price Rp 635
14 November, 2023
Current price Rp 645
Target price Rp 635
9M23 Production declined
In 9M23, tin production declined by -23% YoY, with tin ore production dropping to 11,201 MT, tin metal sales volume decreasing by -28% YoY to 11,100 MT, and tin metal production volume decreasing by -18% YoY to 11,540 MT. This aligns with the 23% decrease in the average selling price of tin metal, reaching USD27,017 per MT compared to USD35,026 per MT in the previous year. The decline in sales was also accompanied by a decrease in TINS exports in 3Q23 compared to 2Q23, attributed to a stronger US currency, slow recovery of the Chinese economy, and weak tin demand due to high LME inventories. Looking ahead, higher production volumes are anticipated, aligning with the company's production targets.
3Q23 bottom line down -205% QoQ
In 3Q23, TINS' net profit fell significantly to IDR -103.7 billion, marking a -205% QoQ decrease. This was driven by a -25% QoQ decline in revenue to IDR 1.81 trillion, influenced by weak demand and a lower ASP. The weakened ASP was a result of global demand weakness and ample stock on the LME. The bottom line decline was further impacted by a +5% QoQ increase in operating expenses. Based on the 9M23 results, the revenue target for 2023-2024 is revised, forecasting a -18% CAGR growth compared to 2022FY due to unfavorable fluctuations in the average selling price of tin and demand. Despite market fluctuations, TINS' focus on low-cost tin ore production is expected to enhance profit margins, navigating volatility in tin selling prices and uncertainties regarding demand strength.
Valuation: -2% downside
Based on 9M23 results, our one-year target price for TINS is revised to IDR 635 per share, or a EV/EBITDA of 6.17x, indicating a -2% downside potential. Our recommendation turns to SELL.
In 9M23, tin production declined by -23% YoY, with tin ore production dropping to 11,201 MT, tin metal sales volume decreasing by -28% YoY to 11,100 MT, and tin metal production volume decreasing by -18% YoY to 11,540 MT. This aligns with the 23% decrease in the average selling price of tin metal, reaching USD27,017 per MT compared to USD35,026 per MT in the previous year. The decline in sales was also accompanied by a decrease in TINS exports in 3Q23 compared to 2Q23, attributed to a stronger US currency, slow recovery of the Chinese economy, and weak tin demand due to high LME inventories. Looking ahead, higher production volumes are anticipated, aligning with the company's production targets.
3Q23 bottom line down -205% QoQ
In 3Q23, TINS' net profit fell significantly to IDR -103.7 billion, marking a -205% QoQ decrease. This was driven by a -25% QoQ decline in revenue to IDR 1.81 trillion, influenced by weak demand and a lower ASP. The weakened ASP was a result of global demand weakness and ample stock on the LME. The bottom line decline was further impacted by a +5% QoQ increase in operating expenses. Based on the 9M23 results, the revenue target for 2023-2024 is revised, forecasting a -18% CAGR growth compared to 2022FY due to unfavorable fluctuations in the average selling price of tin and demand. Despite market fluctuations, TINS' focus on low-cost tin ore production is expected to enhance profit margins, navigating volatility in tin selling prices and uncertainties regarding demand strength.
Valuation: -2% downside
Based on 9M23 results, our one-year target price for TINS is revised to IDR 635 per share, or a EV/EBITDA of 6.17x, indicating a -2% downside potential. Our recommendation turns to SELL.
Previously
| tins_19_march_2018.pdf |
| tins_18_january_2018.pdf |
| tins_7_december_2017.pdf |
| tins_9_october_2017_.pdf |
