TOTL
Contact our analyst Revita
31% Upside, BUY
8th November 2022
Current price Rp312
Target price Rp410
8th November 2022
Current price Rp312
Target price Rp410
IDR1.89 trilliun new contracts
As of 10M2022, TOTL new contracts were up to IDR 1.89 trillion or 95% of the 2022 new contract target of IDR 2 trillion. Most of the new contracts consist of School Buildings, Hotel, Shopping Centers, and Mixed Use Industrial, and Office projects. TOTL still remains focused on premium high rise projects. We expect the new contract target for 2022 can be achieved given that TOTL is participating in many project tenders.
Construction revenue +29% YoY9M22
As of 9M22, TOTL booked revenue of IDR 1.74 trillion, up 28% YoY. TOTL's revenue is dominated by construction at IDR. 1.73 trillion, which is up by 28.6% from IDR 1.35 trillion in 9M21. Our revenue target for 2022F is IDR. 2.1 trillion. By managing costs and implementing direct contracts and lean construction techniques, TOTL is improving operating costs in order to maintain the company's margins while prices rise. We are targeting the company's 2022-2023F margins to be at an average of 4.7% slightly below 2021 in line with estimated increases in construction expenses which as of 9M22 increased 29% YoY due mainly to the impact of higher commodity prices.
Valuation: 31% upside
Our 2022-2023 EPS estimates are 28.9 and 31.5 rupiah respectively, we have a target price of IDR. 410/share, which is a 13x PER. With 31% potential upside, we initiate with a recommendation to BUY.
As of 10M2022, TOTL new contracts were up to IDR 1.89 trillion or 95% of the 2022 new contract target of IDR 2 trillion. Most of the new contracts consist of School Buildings, Hotel, Shopping Centers, and Mixed Use Industrial, and Office projects. TOTL still remains focused on premium high rise projects. We expect the new contract target for 2022 can be achieved given that TOTL is participating in many project tenders.
Construction revenue +29% YoY9M22
As of 9M22, TOTL booked revenue of IDR 1.74 trillion, up 28% YoY. TOTL's revenue is dominated by construction at IDR. 1.73 trillion, which is up by 28.6% from IDR 1.35 trillion in 9M21. Our revenue target for 2022F is IDR. 2.1 trillion. By managing costs and implementing direct contracts and lean construction techniques, TOTL is improving operating costs in order to maintain the company's margins while prices rise. We are targeting the company's 2022-2023F margins to be at an average of 4.7% slightly below 2021 in line with estimated increases in construction expenses which as of 9M22 increased 29% YoY due mainly to the impact of higher commodity prices.
Valuation: 31% upside
Our 2022-2023 EPS estimates are 28.9 and 31.5 rupiah respectively, we have a target price of IDR. 410/share, which is a 13x PER. With 31% potential upside, we initiate with a recommendation to BUY.
