WSKT
Contact our analyst Revita
WE SEE BIG UPSIDE 300-400%
27 March, 2020
Current price Rp456
Target price Rp1600
27 March, 2020
Current price Rp456
Target price Rp1600
Big New Projects
As we mentioned, WSKT booked new contracts in 2019 below our estimate of IDR 26 trillion due to the unfavourable political situation, which delayed some investment projects. Projects based on project owner are as follows: Business development 35%, SOE 46.1%, Government 11,25%, and private 8,01%. Big projects from the 2019 order book include Prabumulih - Muara Enim Toll Road which is a part of Hutama Karya’s Trans Sumatera and worth Rp 4,5 Tn; the Becakayu Toll Road (Section A. Yani) worth Rp 770 Bn and Juanda Airport worth Rp 620 Bn. 30% of new orders come from turnkey projects and WSKT has also started to better penetrate new markets such as overseas and SOE projects.
2019 Result Boosted By Divestment
WSKT booked 2019 revenue and net Income of Rp 31,4 Tn and Rp 938 billion respectively. WSKT recorded Rp 9,0 Tn of cash from operating activities, 125% higher compared to 2018 as the company received payments from several turnkey projects. On December 18th 2019, The Company signed an SPA with Kings Key Limited to divest it’s stake in the Solo - Ngawi and Ngawi - Kertosono Toll Roads with total proceeds amounting to Rp 2,4 Tn. Recognised gains from the divestment proceeds are Rp 286 Bn and was in other income in the FY19 Audited Financial Results. In 2019, The Company has received a cash inflow amounting to Rp 43,7 Tn consisting of Rp 22 Tn from turnkey project payments, Rp 16 Tn from progress payments and Rp 5,8 Tn from reimbursement from LMAN’s land clearing fund. .
Valuation: Significant upside
We adjust our one year target price after the 2019FY result to IDR 1600 or 8x PER. With significant upside, we maintain BUY.
As we mentioned, WSKT booked new contracts in 2019 below our estimate of IDR 26 trillion due to the unfavourable political situation, which delayed some investment projects. Projects based on project owner are as follows: Business development 35%, SOE 46.1%, Government 11,25%, and private 8,01%. Big projects from the 2019 order book include Prabumulih - Muara Enim Toll Road which is a part of Hutama Karya’s Trans Sumatera and worth Rp 4,5 Tn; the Becakayu Toll Road (Section A. Yani) worth Rp 770 Bn and Juanda Airport worth Rp 620 Bn. 30% of new orders come from turnkey projects and WSKT has also started to better penetrate new markets such as overseas and SOE projects.
2019 Result Boosted By Divestment
WSKT booked 2019 revenue and net Income of Rp 31,4 Tn and Rp 938 billion respectively. WSKT recorded Rp 9,0 Tn of cash from operating activities, 125% higher compared to 2018 as the company received payments from several turnkey projects. On December 18th 2019, The Company signed an SPA with Kings Key Limited to divest it’s stake in the Solo - Ngawi and Ngawi - Kertosono Toll Roads with total proceeds amounting to Rp 2,4 Tn. Recognised gains from the divestment proceeds are Rp 286 Bn and was in other income in the FY19 Audited Financial Results. In 2019, The Company has received a cash inflow amounting to Rp 43,7 Tn consisting of Rp 22 Tn from turnkey project payments, Rp 16 Tn from progress payments and Rp 5,8 Tn from reimbursement from LMAN’s land clearing fund. .
Valuation: Significant upside
We adjust our one year target price after the 2019FY result to IDR 1600 or 8x PER. With significant upside, we maintain BUY.
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