UNTR
Contact our analyst Revita
61% Upside, BUY
14th November 2022
Current price Rp 29,000
Target price Rp 46,650
14th November 2022
Current price Rp 29,000
Target price Rp 46,650
Targetting 25% revenue growth
As of 9M22, UNTR revenue was IDR 91.5 trillion up 58% YoY, and bottom line profit increased even more significantly, up 103% YoY helped by a slower increase in operating expenses of only 17% YoY. As of 9M2022, Construction machinery and Mining contracting are still the largest contributors to revenue at 30% and 36% respectively followed by coal mining 27%, gold mining 6%, and construction 1%. Komatsu's 9M22 heavy equipment sales volume increased 107% YoY or 41% QoQ to 4,534 units. Coal production decreased -6% YoY but increased +26% QoQ while the ASP increased 25% YoY and helped mining contracting revenue to increase by 37% in the 9M2022. Komatsu's sales target is maintained as before at 4,800 units because of stronger demand from mining as coal demand increases, together with higher construction activity. As of September, Komatsu leads the heavy equipment market with a 28% market share. Based on 9M2022 results, we revise up our revenue target in 2022-2023F to a CAGR of 24.55% compared to 2021A.
As of 9M22, UNTR revenue was IDR 91.5 trillion up 58% YoY, and bottom line profit increased even more significantly, up 103% YoY helped by a slower increase in operating expenses of only 17% YoY. As of 9M2022, Construction machinery and Mining contracting are still the largest contributors to revenue at 30% and 36% respectively followed by coal mining 27%, gold mining 6%, and construction 1%. Komatsu's 9M22 heavy equipment sales volume increased 107% YoY or 41% QoQ to 4,534 units. Coal production decreased -6% YoY but increased +26% QoQ while the ASP increased 25% YoY and helped mining contracting revenue to increase by 37% in the 9M2022. Komatsu's sales target is maintained as before at 4,800 units because of stronger demand from mining as coal demand increases, together with higher construction activity. As of September, Komatsu leads the heavy equipment market with a 28% market share. Based on 9M2022 results, we revise up our revenue target in 2022-2023F to a CAGR of 24.55% compared to 2021A.
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Coal mining still the biggest profit contributor
In 9M2022, coal mining is still the biggest contributor to pretax profit at 44% followed by mining contracting at 28%. UNTR's coal mining business is run by PT Tuah Turangga Agung (TTA). Total coal sales volume in 9M2022 reached 7,78 million tons, up by 0,35% YoY from 9M2021’s 7,75 million tons, due to a temporary export ban in January 2022. However, due to the significant increase in the average coal selling price (ASP) of 137% YoY, the revenue from Coal Mining increased by 138% yoy to IDR 24,37 trillion. We believe strong coal prices will keep coal mining as the biggest profit contributor in 2022F. Starting in 2022, the company has consolidated revenue from its solar energy subsidiary, PT Energia Prima Nusantara which has installed 6.9 MWp of rooftop solar PVs and is targeting an additional 15 MWp this year.
Valuation: 61% upside potential
Based on 9M22 results, our target price for UNTR is revised to IDR 46,650, which is a valuation of 7,87x PER. With 61% upside potential, we maintain our BUY recommendation.
In 9M2022, coal mining is still the biggest contributor to pretax profit at 44% followed by mining contracting at 28%. UNTR's coal mining business is run by PT Tuah Turangga Agung (TTA). Total coal sales volume in 9M2022 reached 7,78 million tons, up by 0,35% YoY from 9M2021’s 7,75 million tons, due to a temporary export ban in January 2022. However, due to the significant increase in the average coal selling price (ASP) of 137% YoY, the revenue from Coal Mining increased by 138% yoy to IDR 24,37 trillion. We believe strong coal prices will keep coal mining as the biggest profit contributor in 2022F. Starting in 2022, the company has consolidated revenue from its solar energy subsidiary, PT Energia Prima Nusantara which has installed 6.9 MWp of rooftop solar PVs and is targeting an additional 15 MWp this year.
Valuation: 61% upside potential
Based on 9M22 results, our target price for UNTR is revised to IDR 46,650, which is a valuation of 7,87x PER. With 61% upside potential, we maintain our BUY recommendation.
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