UNTR
Contact our analyst Revita
51.3% Upside, BUY
November 3rd, 2023
Current price Rp 23800
Target price Rp 36000
November 3rd, 2023
Current price Rp 23800
Target price Rp 36000
Komatsu sales volume down -4 YoY
In 9M23, Komatsu experienced a decrease in sales volume, with a YoY growth of -4%. The sales volume declined to 4,365 units from 4,534 units in 9M22, in line with our initial estimation for 2023FY, indicating a decrease compared to last year. This decline can be attributed to the construction machinery segment. During the same period, the construction machinery segment recorded a revenue increase of +5% YoY to IDR 28.7 trillion. According to UNTR, Komatsu holds a leading position in the heavy equipment market with a market share of 31%. Taking into account the latest results, we have adjusted our estimation for Komatsu's sales volume in 2023F to 5,500 units, which is slightly lower than the 2022FY figure of 5,753 units.
In 9M23, Komatsu experienced a decrease in sales volume, with a YoY growth of -4%. The sales volume declined to 4,365 units from 4,534 units in 9M22, in line with our initial estimation for 2023FY, indicating a decrease compared to last year. This decline can be attributed to the construction machinery segment. During the same period, the construction machinery segment recorded a revenue increase of +5% YoY to IDR 28.7 trillion. According to UNTR, Komatsu holds a leading position in the heavy equipment market with a market share of 31%. Taking into account the latest results, we have adjusted our estimation for Komatsu's sales volume in 2023F to 5,500 units, which is slightly lower than the 2022FY figure of 5,753 units.
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Mining contracting segment up +18% YoY22% YoY
As of 9M23, mining contracting remains the main contributor to UNTR's revenue, accounting for 40% of total revenue, with PAMA being the main driver. During 9M23, mining contracting generated revenue of IDR 39.1 trillion, reflecting a YoY increase of +18%. PAMA also achieved significant growth in coal production, with a YoY increase of +16% to 96 million tons. Overburden removal also saw a YoY increase of +23% to 853 million bcm. The total average strip ratio increased to 8.9x compared to 8.3x in 9M22. Considering the volatility in the coal market going forward, we have adjusted our estimation for coal production in 2023F to 127.6 million tons. This adjustment takes into account potential uncertainties and fluctuations in the coal market.
Renewable energy
Through its owned subsidiary, PT Energia Prima Nusantara (EPN), UNTR is focusing on renewable energy as one of its transition strategies. As of September 2023, EPN has installed 12.8 Mwp of rooftop solar PV in UT and Astra group. EPN is currently in the process of constructing a mini hydro power plant, PLTM Kemu in Lampung, Sumatera. The capacity of PLTM Besai Kemu is 7MW and is expected to operate by the end of 2023. In addition, EPN also targets several mini hydro projects in Sumatera with a total potential capacity of more than 20 MW.
Valuation: 51.3% upside potential
Based on the 9M23 results, we are maintaining our target price for UNTR at IDR 36,000, which represents a valuation of 4.51x PER (Price-to-Earnings Ratio). With a potential upside of 51.3%, we are also maintaining our BUY recommendation for UNTR.
As of 9M23, mining contracting remains the main contributor to UNTR's revenue, accounting for 40% of total revenue, with PAMA being the main driver. During 9M23, mining contracting generated revenue of IDR 39.1 trillion, reflecting a YoY increase of +18%. PAMA also achieved significant growth in coal production, with a YoY increase of +16% to 96 million tons. Overburden removal also saw a YoY increase of +23% to 853 million bcm. The total average strip ratio increased to 8.9x compared to 8.3x in 9M22. Considering the volatility in the coal market going forward, we have adjusted our estimation for coal production in 2023F to 127.6 million tons. This adjustment takes into account potential uncertainties and fluctuations in the coal market.
Renewable energy
Through its owned subsidiary, PT Energia Prima Nusantara (EPN), UNTR is focusing on renewable energy as one of its transition strategies. As of September 2023, EPN has installed 12.8 Mwp of rooftop solar PV in UT and Astra group. EPN is currently in the process of constructing a mini hydro power plant, PLTM Kemu in Lampung, Sumatera. The capacity of PLTM Besai Kemu is 7MW and is expected to operate by the end of 2023. In addition, EPN also targets several mini hydro projects in Sumatera with a total potential capacity of more than 20 MW.
Valuation: 51.3% upside potential
Based on the 9M23 results, we are maintaining our target price for UNTR at IDR 36,000, which represents a valuation of 4.51x PER (Price-to-Earnings Ratio). With a potential upside of 51.3%, we are also maintaining our BUY recommendation for UNTR.
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