INVESTOR DIGEST Equity Research | 11 March 2020

Economic Data HIGHLIGHT Latest 2020F  Strategy: Share Buyback Relaxation - What to Look Out For? 7-DRRR (%), eop 4.75 4.50  Market Recap March 10th 2020; JCI 5,220.83 Points +84.02 pts (+1.64%); Valued Inflation (YoY %) 2.98 3.30 $431mn; Mkt Cap $401bn; USD/IDR 14,279 US$ 1 = Rp, period avg 14,279 14,257

STRATEGY Stock Market Data

(10 March 2020) Share Buyback Relaxation - What to Look Out For?

JCI Index 5,220.8 1.64%  Companies are now allowed to conduct share buyback without EGM approval, Trading T/O ( Rp bn ) 6,114.3 while twelve Indonesian SOEs reportedly plan to conduct share buybacks. We Market Cap ( Rp tn ) 6,036.5 believe companies have better visibility than the market in assessing the coronavirus impact on their EPS. Timing and size of a share buyback could provide additional signs (but not always accurate) of a company’s increasing conviction on the downside risk assessment. Market Data Summary*  OJK removed EGM approval requirement for conducting share buyback. 2020F 2021F Through the new circular letter announced yesterday (No. 3/SEOJK.04/2020), in consideration of the substantial ytd share price decline, OJK has allowed P/E (x) 13.8 12.5 companies to conduct share buybacks without EGM approval. In 2013, OJK had P/BV (x) 2.0 1.8 done a similar relaxation until the latest revision again (POJK No. EV/EBITDA (x) 11.8 11.0 30/POJK.04/2017), thus requiring EGM approval in 2017. With the new Div. Yield (%) 3.3 3.5 procedures, companies are allowed to conduct share buybacks up to a Net Gearing (%) 23.8 20.7 maximum of 20% of the paid-up capital but maintaining at least 7.5% free-float. ROE (%) 14.8 15.4  Twelve SOEs plan to conduct share buybacks. Reported by detik.com today, EPS Growth (%) 4.3 10.3 about twelve SOEs reportedly will conduct share buybacks, but the timing will EBITDA Growth (%) 5.3 6.2 be decided by each SOE. A total of Rp7tn-8tn cash could be allocated, Earnings Yield (%) 7.2 8.0 representing up to 0.8%/1.8% of the total market-cap/free-float-market-cap of the twelve SOEs: BBRI, BMRI, BBNI, BBTN, WIKA, ADHI, PTPP, JSMR, WSKT, ANTM, * Aggregate of 75 companies in MS research universe, PTBA, and TINS. These companies account for around 16% of the JCI Index’s representing 62.8%of JCI’s market capitalization market cap.

 Look for the timing and size; companies have better visibility, but not always accurate. The market has been busy assessing the COVID-19 impact to the supply and demand activities across sectors. While stock prices have substantially declined, with the JCI breaking the -2 standard deviation threshold, the market may continue to be volatile given the unknown timing of the outbreak. We believe companies have better visibility than the market in assessing the COVID-19 impact on their EPS. Timing and size of a share buyback could provide additional signs (but not always accurate) of a company’s increasing conviction on the downside risk assessment.  Universe screening for relatively undervalued stocks with large cash balance. Stocks with 12M forward valuations at two standard deviations below the 5Y mean with net cash position and >10% free-float are as follows: KLBF, RALS, UNTR, SCMA, and MAPA. Stocks with 12M forward valuations at two standard deviations below the 5Y mean with low net gearing position, >10% free-float, and reasonable CAPEX commitment are the following: MAPI, HEAL, INDF, ASII,

Please see important disclosure at the back of this report Page 1 of 8 Equity Research | 11 March 2020

UNVR, and MYOR. Stocks trading below 1.0x trailing P/BV with <0.3x net gearing and reasonable CAPEX commitment are as follows: HRUM, ITMG, JRPT, INCO, UNTR, ADRO, BIRD, BSDE, LPKR, and BEST. For Banks, BBNI already trades below 2 standard deviations with <1.0x PBV. In Figure 2 on Page 4, we also provided the historical shares buyback during the 2008, 2009, 2013 and 2015 global economic shocks.

UNIVERSE SCREENING FOR FORWARD VALUATION MULTIPLES, NET DEBT LEVEL, AND 2020 CAPEX FORECASTS 3Q19 Price 12M Z- 3Q19 Z- 3Q19 3Q19 Net Net ADTV Valuation Chg Fwd Score T12M Total CAPEX Free- TICKER Score Cash Debt Debt/ Gearing 3M Methods from Valuat Since PBV Equity 2020F Float % 5yr (Rpbn) (Rpbn) (Cash) (x) (Rpbn) 17Jan ion 2007 (Rpbn) (Rpbn) JCI PE -18.4 11.8 -3.0 -1.1 1.5 Banking BBCA IJ PBV -15.9 3.6 0.3 0.1 4.1 62,977 167,982 N.A. 566.7 43.1 BBNI IJ PBV -27.3 0.8 -2.3 -1.7 0.9 46,426 121,274 N.A. 173.0 40.0 BBRI IJ PBV -19.0 2.1 -0.2 -0.8 2.2 86,822 199,540 N.A. 514.9 43.2 BBTN IJ PBV -32.6 0.7 -1.6 -1.2 0.6 16,252 24,120 N.A. 28.7 40.0 BDMN IJ PBV -29.1 0.6 -1.9 -1.5 0.6 9,958 44,125 N.A. 11.3 5.9 BJBR IJ PBV -14.8 0.7 -1.6 -1.7 0.7 7,741 10,884 N.A. 9.4 25.2 BJTM IJ PBV -12.0 0.9 -1.9 -1.5 1.0 7,363 8,943 N.A. 5.5 20.5 BMRI IJ PBV -14.9 1.5 -1.3 -1.2 1.5 78,024 200,828 N.A. 383.3 40.0 BNGA IJ PBV -17.1 0.5 -1.2 -1.1 0.4 12,626 42,283 N.A. 3.1 8.2 BNLI IJ PBV 3.2 1.5 0.8 -0.1 1.5 9,673 23,729 N.A. 31.7 10.9 PNBN IJ PBV -18.8 0.6 -1.1 -1.2 0.6 9,415 43,108 N.A. 4.0 15.1 BTPS IJ PBV -13.9 4.3 0.6 0.6 5.4 3,232 4,954 N.A. 23.2 30.0 BFIN IJ PBV -24.9 1.1 -0.7 0.1 1.1 913 6,501 N.A. 0.6 48.0 Construction & materials INTP IJ PE -27.2 23.4 -0.1 0.6 2.2 6,026 113 -5,914 22,372 (0.3) 1,000 31.8 49.0 SMGR IJ PE -25.9 17.1 -0.1 0.4 1.8 3,436 32,961 29,525 32,960 0.9 1,863 56.2 49.0 ADHI IJ PE -42.5 3.0 -1.9 -1.7 0.4 1,459 11,106 9,648 6,521 1.5 700 8.4 49.0 PTPP IJ PE -41.0 4.0 -1.4 -1.6 0.5 4,357 16,089 11,732 16,636 0.7 2,932 31.3 48.9 WIKA IJ PE -27.8 5.8 -1.5 -1.4 0.8 8,900 21,745 12,845 18,344 0.7 3,267 28.4 34.9 WSKT IJ PE -42.6 4.6 -1.2 -1.4 0.6 3,496 82,778 79,282 29,227 2.7 16,055 48.0 34.0 WTON IJ PE -28.0 4.6 -1.4 -1.5 0.8 207 2,533 2,326 3,292 0.7 650 3.2 40.0 WSBP IJ PE -41.7 4.7 -1.2 -1.2 1.0 245 4,544 4,299 7,842 0.5 1,000 7.8 33.0 JSMR IJ PE -14.8 15.2 -1.6 -0.8 1.8 3,886 33,583 29,697 22,272 1.3 25,999 21.0 24.4 Consumer staples ICBP IJ PE -10.4 21.6 -1.5 0.0 5.1 6,051 2,639 -3,412 25,231 (0.1) 3,938 57.8 19.5 INDF IJ PE -22.7 10.4 -2.1 -1.4 1.5 9,408 27,563 18,154 51,967 0.3 7,247 55.5 49.9 MYOR IJ PE -11.5 19.0 -2.0 0.0 4.5 2,103 5,900 3,798 9,012 0.4 1,195 6.0 15.7 UNVR IJ PE -16.4 34.2 -3.5 -0.2 50.7 524 3,221 2,697 6,888 0.4 911 87.7 15.0 GGRM IJ PE -22.9 9.4 -3.1 -1.5 1.8 3,464 8,850 5,386 47,374 0.1 4,277 63.4 23.8 HMSP IJ PE -30.6 13.4 -2.4 -1.3 5.7 19,514 408 -19,107 31,932 (0.6) 775 76.9 7.5 KLBF IJ PE -29.4 19.2 -3.0 -0.4 3.5 2,611 733 -1,879 16,136 (0.1) 1,219 31.2 42.8 SIDO IJ PE -4.4 19.8 0.9 0.6 5.9 959 0 -959 3,170 (0.3) 150 4.6 19.0 MLBI IJ PE -7.5 19.1 -1.9 -1.9 26.6 266 650 384 796 0.5 200 0.3 18.2 Healthcare MIKA IJ EV/EBITDA -11.1 24.8 -1.0 -1.0 7.4 614 6 -608 4,640 (0.1) 466 24.4 38.1 SILO IJ EV/EBITDA -5.7 9.5 -0.9 -1.1 1.6 163 167 4 6,389 0.0 600 3.0 12.4 HEAL IJ EV/EBITDA -19.1 9.3 -2.7 -2.7 4.4 433 1,224 791 2,652 0.3 635 0.7 24.4 Consumer discretionary ACES IJ PE -13.9 20.2 -1.0 -0.1 5.3 809 11 -798 4,485 (0.2) 175 31.5 40.0 LPPF IJ PE -38.8 5.3 -1.5 -1.8 4.0 633 475 -158 1,679 (0.1) 430 35.9 74.4 MAPA IJ PE -34.2 9.2 -2.4 -2.4 3.9 238 0 -238 2,877 (0.1) 327 0.7 23.1 MAPI IJ PE -26.9 10.8 -2.5 -0.7 2.1 882 1,861 979 7,055 0.1 1,223 10.7 49.0 RALS IJ PE -25.4 9.0 -2.4 -1.8 1.4 901 0 -901 4,116 (0.2) 280 6.9 37.1 ERAA IJ PE -10.8 6.6 -0.3 -0.7 1.1 550 2,659 2,110 4,854 0.4 530 30.2 45.2 ASII IJ PE -29.0 8.8 -2.7 -2.0 1.4 25,752 90,649 64,897 180,830 0.4 15,000 211.2 49.8 SCMA IJ PE -39.6 9.2 -2.3 -1.3 2.7 726 12 -714 5,793 (0.1) 746 38.1 33.2 MNCN IJ PE -28.3 7.0 -1.5 -1.4 1.4 733 4,616 3,883 11,936 0.3 646 46.4 43.6 PZZA IJ PE -22.3 10.3 -2.5 -2.5 2.2 80 76 -4 1,286 (0.0) 344 0.3 35.2

Please see important disclosure at the back of this report Page 2 of 8 Equity Research | 11 March 2020

3Q19 Price 12M Z- 3Q19 Z- 3Q19 3Q19 Net Net ADTV Valuation Chg Fwd Score T12M Total CAPEX Free- TICKER Score Cash Debt Debt/ Gearing 3M Methods from Valuat Since PBV Equity 2020F Float % 5yr (Rpbn) (Rpbn) (Cash) (x) (Rpbn) 17Jan ion 2007 (Rpbn) (Rpbn) Commodities UNTR IJ PE -27.4 5.7 -2.0 -2.4 1.0 15,978 15,163 -815 59,012 (0.0) 4,200 79.1 40.4 ADRO IJ PE -31.8 5.8 -1.3 -1.5 0.6 14,290 18,501 4,212 64,208 0.1 350 82.5 43.7 HRUM IJ PE -12.9 7.4 -0.6 -0.6 0.7 3,177 0 -3,177 5,666 (0.6) 5 1.2 14.9 INDY IJ PE -49.2 5.4 -0.2 -0.3 0.2 8,655 21,241 12,586 15,374 0.8 125 8.5 29.6 ITMG IJ PE -25.2 6.1 -0.8 -1.1 0.8 3,837 150 -3,686 12,920 (0.3) 50 21.7 34.8 PTBA IJ PE -17.2 6.8 -1.2 -1.2 1.4 4,240 568 -3,672 17,334 (0.2) 2,000 60.2 31.2 ANTM IJ PE -33.9 10.8 -0.7 -0.4 0.7 3,463 9,859 6,395 19,948 0.3 1,306 51.5 35.0 INCO IJ PE -36.3 16.2 -0.3 -0.1 0.8 2,861 21 -2,839 26,722 (0.1) 99 27.2 20.5 TINS IJ PE -39.8 7.0 -1.1 -0.8 0.7 1,424 11,391 9,967 6,064 1.6 700 13.3 35.0 MDKA IJ PE 3.8 21.6 1.4 1.4 3.9 897 4,191 3,294 7,403 0.4 n/a 79.8 42.6 Property & Industrial Estate ASRI IJ PE -39.3 4.0 -1.7 -0.9 0.3 1,086 8,073 6,987 9,756 0.7 222 1.6 52.9 BSDE IJ PE -26.3 8.7 -1.9 -1.5 0.6 6,864 12,838 5,974 32,867 0.2 0 12.8 39.8 CTRA IJ PE -23.8 14.3 -0.5 -0.5 1.0 3,237 8,907 5,670 16,965 0.3 1,195 15.1 53.0 JRPT IJ PE -24.6 4.4 -1.6 -1.1 0.9 937 23 -914 7,117 (0.1) 531 4.2 19.8 PWON IJ PE -14.5 9.0 -1.4 -1.4 1.7 4,507 5,038 531 17,361 0.0 1,611 21.5 34.0 SMRA IJ PE -30.4 17.6 -1.2 -0.4 1.4 1,597 8,575 6,978 9,241 0.8 1,146 14.7 58.8 LPKR IJ PE -1.7 21.5 2.2 0.4 0.5 5,173 12,368 7,195 35,128 0.2 758 13.9 50.7 DMAS IJ PE -32.0 8.6 -1.0 -1.0 1.4 1,100 0 -1,100 6,935 (0.2) 156 7.2 17.7 BEST IJ PE -35.2 3.4 -1.5 -1.7 0.3 874 1,843 969 4,298 0.2 946 2.8 41.8 Telco EXCL IJ PE -37.5 17.8 -2.3 -0.6 1.2 1,496 26,253 24,757 18,899 1.3 7,524 33.4 33.6 TLKM IJ PE -8.1 14.8 -1.6 0.1 3.5 15,017 50,804 35,787 116,446 0.3 34,922 307.4 47.9 ISAT IJ PE -26.2 119.7 1.4 2.7 0.9 1,207 30,579 29,372 11,844 2.5 8,930 11.8 20.7 LINK IJ PE -8.4 8.8 -1.5 -1.5 2.2 274 708 434 4,591 0.1 1,396 4.9 36.5 TBIG IJ PE -9.9 22.0 0.6 0.7 6.1 333 22,663 22,330 4,011 5.6 1,760 52.6 45.7 TOWR IJ PE -1.9 15.4 -0.2 -0.9 4.6 2,241 13,043 10,802 8,306 1.3 2,242 59.9 49.2 Chemical AGII IJ PE -17.3 13.8 -0.8 -0.8 0.5 283 3,269 2,987 3,214 0.9 164 0.6 20.7 Airlines GMFI IJ PBV -51.9 N.A. N.A. N.A. 0.5 510 3,240 2,730 4,729 0.6 78 1.8 13.5 Transportation BIRD IJ PE -20.4 12.3 -0.4 -0.5 1.0 586 945 360 5,332 0.1 984 4.0 20.3 Poultry CPIN IJ PE -21.4 22.3 1.0 1.3 4.8 1,641 5,183 3,542 20,027 0.2 869 40.2 44.5 JPFA IJ PE -21.1 8.0 -0.9 0.1 1.5 998 9,642 8,643 10,715 0.8 1,867 25.6 46.7 MAIN IJ PE -31.3 4.7 -1.7 -1.7 0.7 84 2,012 1,928 2,131 0.9 246 2.4 42.7 Note: Figures as of 9 March 2020. Source: Bloomberg (for valuation data), Mandiri Sekuritas Estimates (for 2020 CAPEX data except for BMRI)

Adrian Joezer (+6221 5296 9415) [email protected]

MARKET

Market Recap March 10th 2020; JCI 5,220.83 Points +84.02 pts (+1.64%); Valued $431mn; Mkt Cap $401bn; USD/IDR 14,279

 TOP TURNOVER: BBCA BBRI BBNI ASII TLKM BMRI HMSP UNVR PGAS UNTR INKP WIKA GGRM INDF TOWR MDKA SMGR MNCN PTPP (60%)

 ADVANCING SECTOR: financial+2.4%; consumer+2.2%; telco+1.4%; mining & auto+1.2%; cement+1.1%; construction+0.6%; property+0.3%

 DECLINING SECTOR: plantation-0.1%

Please see important disclosure at the back of this report Page 3 of 8 Equity Research | 11 March 2020

 Good news came in tandem: from IDR10TN funds set aside by 12 listed SOE for buy-back program without needing shareholders’ approval to the stock exchange’s decision to reduce the lower auto reject limit to 10% for every stock traded effective immediately until further notice. E-Mini futures for the S&P 500 were at least trying to steady, rallying 1% in Asia after an early slide. Nikkei futures also came off lows, though they were still 600 pts below Monday’s cash close. Accordingly, Indo equities staged a comeback. The JCI recovered by 1.6% to close at 5220 level. Energy stocks led the losses globally after Brent crude futures closed down 24% as markets braced for a price war between Saudi Arabia and Russia. Brent futures rose 5.1% to $36.12 a barrel by 0738 GMT, paring back earlier gains that saw prices touch a session- high of $37.38. US WTI gained 5.3% to $32.78, after hitting a high of $33.73. Similar situation hit Indo energy stocks: MEDC+0.9% ESSA+0.6% ELSA flat AKRA-4.4%. The IDR improved from 14433 to 14279 level; while the benchmark 10-year bond rose and the yield fell 11.7 bps to 6.990%. Among the big caps, BBRI contributed the most to the gain, increasing 4.3%.

 Market turnover (excluding $11MN ASMI; $5.9MN NATO crossing) was steady at $431MN. Foreign participants rose to 40% and came up better seller for 9%. Gainers beat losers by 7 to 4. Global funds sold a net $76.6MN in Indo bonds on Mar 5th, the ninth day of outflows; and bought a net $15.2MN in the country’s equities on Mar 9th. In the past year, the JCI had a similar or greater gain four times. The next day, it advanced twice for an avg 1.2% and declined 0.2% once. This quarter, it fell 17.0%, heading for the biggest decline at least in ten years. It declined 18.0% in the past 52 weeks. The MSCI AC Asia Pacific Index lost 3.6% in the same period. It is now 21.3% below its 52-week high on April 18, 2019 and 1.7% above its low on March 9, 2020. It is down 5.4% in the past five days and fell 12.0% in the past 30 days. It is trading at a PER of 15.9x on a trailing basis and 12.2x estimated earnings of its members for the coming year. Its dividend yield is 3.0% on a trailing 12-month basis. Its members have a total market capitalization of IDR5.97 quadrillion. The 30-day price volatility rose to 28.61% compared with 27.88% in the previous session and the average of 14.69% over the past month.

Sales Team +6221 527 5375

FROM THE PRESS

The Government Plans to Ease the Tax Policy Finance Minister, Sri Mulyani Indrawati, mentioned that the Government prepares to relax several tax policies to stimulate the economy. First, there is a plan to delay the payment of personnel, import and corporate income tax (PPh 21 personnel, 22 imports and 25 corporates). Second, the Government may accelerate the VAT restitution and raise the maximum restitution limit to each taxable enterprises from Rp 1 bn to Rp 5 bn. (Kontan)

Bank BTN (BBTN) said it is ready to issue mortgage backed securities amounting to Rp500bn CFO director of the bank, Nixon Napitupulu states that the bank plans to conduct asset securitization totaling to Rp4tn for this year, whereby Rp500bn of it will be intended for retail investors. The bank hasn’t find a strategic partner that have large retail customer base to realize its plan, as BBTN usually collaborates with PT Sarana Mutligriya Finansial (SMF) to issue asset securitization. (Bisnis )

Gudang Garam (GGRM) to start the construction of Dhoho Airport in April GGRM targets to complete the construction of Dhoho Kediri Airport in 2022. After the completion, the airport will be operated under PT 1. Istata T Siddharta, Director of GGRM, said there are only 1% or around 2ha of land acquisition left for the airport. Previously, GGRM management already appointed its subsidiary PT Surya Dhoho Investama and subsidiary of PT PP Presisi (PPRE), PT Lancarjaya Mandiri Abadi to be the contractors for this project. The total investment cost for this airport project will be around Rp6-9trn. (Kontan)

Please see important disclosure at the back of this report Page 4 of 8 Equity Research | 11 March 2020

Indices and Fund Flows Currencies and Bonds Major Commodities

YTD Chg YTD YTD Indices Last Chg (%) Currency Last Chg (%) Last Chg (%) (%) Chg (%) Chg (%)

JCI 5,220.8 +1.6 -17.1 Rp/US$ 14,244 -1.10 -2.8 Oil spot (US$/bl) 34.36 +10.4 -43.7 Dow Jones 25,018.2 +4.9 -12.3 US$/EUR 1.128 -1.48 -0.6 Nickel spot (US$/mt) 12,634 +0.3 -9.4 Nikkei 19,867.1 +0.9 -16.0 YEN/US$ 105.64 +3.20 +2.8 Gold spot (US$/oz) 1,649 -1.9 +8.7 Hang Seng 25,392.5 +1.4 -9.9 SGD/US$ 1.392 +0.50 -3.3 Tin 3-month (US$/mt) 16,875 +1.1 -1.7 STI 2,832.5 +1.8 -12.1 CPO futures (Ringgit/ton) 2,342 +0.4 -22.7 Ishares indo 20.7 +6.4 -19.5 Coal (US$/ton) 65.3 +0.2 -3.5 Rubber forward (US¢/kg) 160.6 +2.2 -3.4 Foreign YTD YTD Gov. Bond Chg Soybean oil Fund Flows Last Chg Last Chg 27.44 +0.5 -20.4 Chg Yield (bps) (US$/100gallons) (US$mn) (bps) Equity Flow -59.5 -507 5Yr 6.11 -13 -33 Baltic Dry Index 627.0 +2.0 -42.5 Bonds Flow -151.4 -2,346 10Yr 6.97 -14 -10

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Equity Valuation Price Price % of Mkt Cap Net Profit PER (x) P/BV (x) EV/EBITDA (x) EPS Growth Div.Yield Code Rating (Rp) Target PT (Rp Bn) 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 MANSEK universe 5,221 6,875 31.7 3,789,291 274,050 302,251 13.8 12.5 2.0 1.8 11.8 11.0 4.3% 10.3% 3.3% 3.5% Banking 1,496,926 116,064 130,304 12.9 11.5 2.0 1.8 N.A. N.A. 15.3% 12.3% 2.7% 3.1% BBCA Neutral 29,625 31,000 4.6 730,405 31,769 34,327 23.0 21.3 3.8 3.4 N.A. N.A. 10.5% 8.1% 1.3% 1.6% BBNI Neutral 5,675 9,000 58.6 105,831 18,879 20,915 5.6 5.1 0.8 0.8 N.A. N.A. 13.4% 10.8% 7.1% 8.0% BBRI Buy 3,910 5,050 29.2 482,097 41,393 47,217 11.6 10.2 2.2 1.9 N.A. N.A. 17.3% 14.1% 3.7% 4.3% BBTN Buy 1,500 2,500 66.7 15,885 3,389 4,031 4.7 3.9 0.7 0.6 N.A. N.A. 1296.3% 18.9% 3.5% 4.6% BDMN Neutral 2,780 4,900 76.3 27,170 4,698 5,825 5.7 4.6 0.6 0.5 N.A. N.A. -19.7% 24.0% 7.5% 6.1% BJBR Neutral 945 1,770 87.3 9,503 1,838 2,183 5.2 4.4 0.8 0.7 N.A. N.A. 27.4% 18.8% 8.4% 8.4% BJTM Buy 585 790 35.0 8,776 1,554 1,745 5.6 5.0 0.9 0.8 N.A. N.A. 12.9% 12.3% 8.2% 8.7% BNGA Buy 790 1,300 64.6 19,854 4,298 4,832 4.6 4.1 0.4 0.4 N.A. N.A. 18.3% 12.4% 3.7% 4.3% BNLI Neutral 1,315 1,490 13.3 36,876 1,528 1,630 24.1 22.6 1.5 1.4 N.A. N.A. 5.6% 6.7% 0.0% 0.0% PNBN Buy 1,000 1,630 63.0 24,088 3,466 3,829 6.9 6.3 0.6 0.5 N.A. N.A. 9.1% 10.5% 0.0% 0.0% BTPS Buy 3,860 4,200 8.8 29,736 1,720 2,096 17.3 14.2 4.4 3.5 N.A. N.A. 28.5% 21.9% 0.9% 1.2% BFIN Buy 448 900 100.9 6,704 1,532 1,674 4.4 4.0 0.8 0.7 N.A. N.A. 6.4% 9.2% 6.4% 6.9% Construction & materials 181,174 13,782 16,402 13.1 11.0 1.3 1.2 9.5 8.6 9.3% 19.0% 2.1% 2.0% INTP Buy 13,800 21,600 56.5 50,801 2,313 2,759 22.0 18.4 2.1 1.9 11.1 9.3 32.7% 19.3% 1.2% 1.6% SMGR Buy 9,500 15,920 67.6 56,349 3,988 4,865 14.1 11.6 1.6 1.5 7.6 6.7 88.2% 22.0% 2.2% 1.5% ADHI Neutral 680 1,120 64.7 2,421 619 593 3.9 4.1 0.4 0.4 4.2 4.3 -6.8% -4.2% 5.5% 5.1% PTPP Buy 980 2,050 109.2 6,076 981 1,320 6.2 4.6 0.6 0.5 5.1 4.8 2.4% 34.6% 4.7% 4.8% WIKA Buy 1,550 2,500 61.3 13,888 1,671 1,871 8.3 7.4 0.9 0.8 5.8 4.2 -17.2% 12.0% 2.4% 2.7% WSKT Buy 850 1,660 95.3 11,374 1,245 1,440 9.1 7.9 0.6 0.6 15.0 13.0 -21.7% 15.6% 2.2% 2.5% WTON Buy 328 700 113.4 2,859 586 678 4.9 4.2 0.8 0.6 3.5 3.1 14.3% 15.7% 5.4% 6.1% WSBP Buy 180 360 100.0 4,745 910 1,026 5.2 4.6 0.6 0.5 4.4 3.8 14.2% 12.9% 8.4% 9.6% JSMR Buy 4,500 7,400 64.4 32,660 1,471 1,851 22.2 17.6 1.7 1.6 13.0 13.2 -33.6% 25.8% 1.4% 0.9% Consumer staples 873,848 45,308 50,498 19.3 17.3 4.5 4.1 12.4 11.2 -7.6% 11.5% 4.1% 4.1% ICBP Buy 10,775 12,350 14.6 125,657 5,414 5,889 23.2 21.3 4.7 4.2 14.2 13.0 7.4% 8.8% 2.1% 2.3% INDF Buy 6,750 9,750 44.4 59,265 4,929 5,272 12.0 11.2 1.6 1.5 7.4 7.1 6.9% 6.9% 5.0% 5.3% MYOR Neutral 1,800 2,850 58.3 40,246 2,152 2,476 18.7 16.3 3.7 3.2 10.1 8.9 15.5% 15.0% 1.8% 2.0% UNVR Neutral 7,100 9,650 35.9 270,865 8,027 8,978 33.7 30.2 42.1 36.6 23.3 20.9 8.3% 11.8% 2.7% 3.0% GGRM Buy 45,850 63,450 38.4 88,219 7,512 8,963 11.7 9.8 1.6 1.5 7.4 6.5 -22.1% 19.3% 3.3% 5.7% HMSP Buy 1,600 2,450 53.1 186,109 12,297 13,379 15.1 13.9 5.4 5.2 11.3 10.3 -22.6% 8.8% 8.4% 6.5% KLBF Buy 1,155 1,950 68.8 54,141 2,742 3,027 19.7 17.9 3.1 2.8 12.3 11.1 7.2% 10.4% 2.5% 2.8% SIDO Buy 1,260 1,450 15.1 18,900 914 1,023 20.7 18.5 5.0 4.6 14.8 13.1 12.8% 11.9% 4.2% 4.7% MLBI Buy 14,450 19,450 34.6 30,446 1,320 1,493 23.1 20.4 20.2 16.8 14.9 13.2 10.4% 13.1% 3.5% 3.9% Healthcare 49,367 1,143 1,325 43.2 37.3 3.7 3.4 15.3 13.3 18.3% 16.0% 0.7% 0.8% MIKA Buy 2,150 3,100 44.2 31,284 794 870 39.4 36.0 6.5 5.9 25.4 22.9 15.1% 9.6% 0.9% 1.1% SILO Buy 6,225 7,150 14.9 10,116 44 100 228.0 101.1 1.6 1.6 8.5 7.0 107.0% 125.6% 0.0% 0.0% HEAL Buy 2,680 5,200 94.0 7,968 304 355 26.2 22.4 3.5 3.1 10.0 8.8 19.4% 16.7% 0.9% 1.0% Consumer discretionary 305,710 31,747 33,629 9.6 9.1 1.4 1.3 7.4 6.8 5.8% 5.9% 4.4% 4.5% ACES Neutral 1,430 1,800 25.9 24,525 1,183 1,306 20.7 18.8 4.5 4.0 16.5 14.7 6.5% 10.4% 2.3% 2.4% LPPF Neutral 2,580 3,300 27.9 7,528 1,563 1,664 4.8 4.5 2.1 1.7 2.2 1.7 10.4% 6.5% 9.4% 10.4% MAPA Buy 3,160 7,350 132.6 9,007 934 1,159 9.6 7.8 2.4 1.9 5.8 4.6 28.4% 24.1% 2.4% 3.1% MAPI Buy 740 1,200 62.2 12,284 1,088 1,311 11.3 9.4 1.7 1.5 4.3 3.6 21.7% 20.5% 1.1% 1.3% RALS Buy 865 1,600 85.0 6,138 667 705 9.2 8.7 1.4 1.3 4.0 3.5 10.1% 5.7% 6.4% 7.1% ERAA Buy 1,560 2,400 53.8 4,976 632 902 7.9 5.5 0.9 0.8 5.2 3.7 140.8% 42.6% 2.5% 3.6% ASII Buy 5,150 8,200 59.2 208,490 21,183 21,717 9.8 9.6 1.3 1.2 8.3 8.0 -1.3% 2.5% 4.6% 4.6% SCMA Buy 935 1,800 92.5 13,770 1,566 1,693 8.8 8.1 2.3 2.1 6.1 5.8 35.7% 8.1% 8.0% 8.6% MNCN Buy 1,155 2,200 90.5 14,326 2,427 2,593 5.9 5.5 1.1 0.9 4.2 3.7 24.1% 6.8% 2.5% 2.7% MSIN Buy 400 650 62.5 2,081 267 316 7.8 6.6 1.4 1.2 4.6 4.3 16.3% 18.1% 6.4% 7.6% PZZA Buy 855 1,400 63.7 2,584 237 264 10.9 9.8 1.6 1.4 5.5 4.9 18.3% 11.3% 1.6% 1.8% Commodities 205,664 23,873 25,042 8.6 8.2 0.9 0.8 3.7 3.3 -4.5% 4.9% 4.4% 4.4% UNTR Buy 16,525 22,500 36.2 61,640 8,897 9,130 6.9 6.8 0.9 0.8 3.2 2.8 -15.2% 2.6% 4.3% 4.4% ADRO* Neutral 1,030 1,350 31.1 32,946 372 353 6.2 6.6 0.6 0.6 2.7 2.5 -7.9% -5.2% 5.7% 5.3% HRUM* Neutral 1,200 1,300 8.3 3,080 17 14 12.7 16.0 0.7 0.7 -0.3 -0.7 -23.9% -20.3% 4.3% 3.4% INDY* Neutral 630 910 44.5 3,282 2 7 127.9 34.7 0.2 0.2 1.9 1.6 -70.9% 271.2% 0.2% 0.7%

Please see important disclosure at the back of this report Page 6 of 8 Equity Research | 11 March 2020

Price Price % of Mkt Cap Net Profit PER (x) P/BV (x) EV/EBITDA (x) EPS Growth Div.Yield Code Rating (Rp) Target PT (Rp Bn) 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 ITMG* Neutral 9,500 10,450 10.0 10,417 100 101 7.3 7.3 0.8 0.8 2.4 2.3 -20.8% 0.9% 11.7% 11.7% PTBA Neutral 2,310 2,350 1.7 26,617 3,482 3,496 7.6 7.6 1.4 1.4 4.8 4.7 -18.3% 0.4% 9.8% 9.9% ANTM Buy 575 1,100 91.2 13,818 959 1,319 14.4 10.5 0.7 0.6 7.8 7.1 5.5% 37.6% 2.4% 3.3% INCO* Buy 2,320 4,000 72.4 23,052 111 166 14.5 9.8 0.8 0.7 4.3 3.2 93.6% 49.6% 0.0% 0.0% TINS Neutral 550 870 58.2 4,096 394 429 10.4 9.6 0.6 0.6 5.6 5.3 N/M 8.8% 3.4% 3.7% MDKA* Buy 1,220 1,600 31.1 26,715 107 112 17.4 16.8 3.1 2.6 9.0 8.3 29.8% 4.5% 0.0% 0.0% Property & Industrial Estate 102,851 10,555 9,376 9.7 11.0 0.8 0.9 8.5 8.2 -4.7% -11.2% 2.1% 2.0% ASRI Neutral 151 310 105.3 2,967 468 948 6.3 3.1 0.3 0.3 10.0 6.9 -29.4% 102.6%1.3% 1.3% BSDE Buy 940 1,650 75.5 18,092 2,086 2,119 8.7 8.5 0.6 0.6 7.3 7.4 -14.5% 1.6% 0.0% 0.5% CTRA Buy 790 1,550 96.2 14,663 1,128 1,366 13.0 10.7 0.9 0.8 9.4 8.9 17.0% 21.0% 1.1% 1.2% JRPT Buy 410 1,050 156.1 5,638 949 1,035 5.9 5.4 0.7 0.7 5.2 4.2 -6.0% 9.0% 4.1% 5.1% PWON Buy 498 800 60.6 23,983 2,532 2,532 9.5 9.5 1.4 1.2 7.2 6.9 0.3% 0.0% 1.2% 1.2% SMRA Neutral 690 1,330 92.8 9,954 550 722 18.1 13.8 1.3 1.2 9.5 8.6 54.4% 31.1% 0.7% 0.7% LPKR Buy 230 360 56.5 16,236 861 812 18.9 20.0 0.5 0.5 13.4 13.0 -54.0% -5.7% 0.4% 0.4% DMAS Buy 208 390 87.5 10,025 1,441 1,086 7.0 9.2 1.4 1.4 6.4 8.8 81.9% -24.7% 11.5% 9.7% BEST Buy 134 400 198.5 1,293 540 700 2.4 1.8 0.3 0.2 3.8 3.1 19.4% 29.8% 8.2% 10.8% Telco 450,523 23,972 27,310 18.8 16.5 2.8 2.7 5.8 5.5 -11.4% 13.9% 3.9% 4.2% EXCL Buy 2,130 4,000 87.8 22,765 954 1,637 23.9 13.9 1.1 1.1 4.7 4.3 33.9% 71.5% 0.9% 1.3% TLKM Buy 3,490 4,400 26.1 345,727 20,159 21,712 17.2 15.9 3.2 3.0 5.8 5.5 3.2% 7.7% 4.4% 4.7% ISAT Buy 2,060 3,500 69.9 11,194 -1,420 -685 -7.9 -16.3 0.9 0.9 4.2 3.9 N/M 51.8% 0.0% 0.0% LINK Buy 3,480 5,500 58.0 10,133 980 1,017 10.5 10.1 1.9 1.7 4.6 4.4 -3.3% 3.8% 4.8% 5.0% TBIG Buy 1,005 1,420 41.3 21,813 1,010 1,208 21.6 18.1 5.3 4.6 10.8 10.1 10.7% 19.7% 2.8% 2.8% TOWR Buy 775 1,030 32.9 38,891 2,289 2,420 17.0 16.1 3.9 3.5 9.3 8.8 8.2% 5.7% 3.1% 3.1% Chemical 1,656 136 163 12.2 10.1 0.5 0.5 5.9 5.2 29.5% 20.3% 0.0% 0.0% AGII Buy 540 700 29.6 1,656 136 163 12.2 10.1 0.5 0.5 5.9 5.2 29.5% 20.3% 0.0% 0.0% Airlines 2,287 540 837 4.2 2.7 0.4 0.4 4.0 2.4 30.0% 55.0% 0.0% 0.0% GMFI* Neutral 81 275 239.2 2,287 38 59 4.2 2.7 0.4 0.4 4.0 2.4 26.1% 56.3% 0.0% 0.0% Transportation 5,254 369 421 14.2 12.5 0.9 0.9 5.4 5.1 21.4% 13.9% 2.0% 2.2% BIRD Buy 2,100 3,100 47.6 5,254 369 421 14.2 12.5 0.9 0.9 5.4 5.1 21.4% 13.9% 2.0% 2.2% Poultry 114,029 6,561 6,944 17.4 16.4 2.9 2.6 10.5 9.6 16.7% 5.8% 1.6% 1.9% CPIN Neutral 5,875 4,950 (15.7) 96,338 4,219 4,490 22.8 21.5 4.0 3.5 14.2 13.3 16.4% 6.4% 1.4% 1.6% JPFA Buy 1,375 1,950 41.8 16,124 2,042 2,127 7.9 7.6 1.3 1.2 5.6 4.9 19.0% 4.1% 2.9% 3.5% MAIN Buy 700 1,150 64.3 1,567 300 327 5.2 4.8 0.6 0.6 3.9 3.5 7.1% 9.3% 2.4% 2.6% Note: - *) net profit in USD mn - U/R means Under Review - n/a means Not Available - N/M means Not Meaningful - N.A means Not Applicable

Please see important disclosure at the back of this report Page 7 of 8 Mandiri Sekuritas A subsidiary of PT Bank Mandiri (Persero) Tbk Menara Mandiri Tower I, 25th floor, Jl. Jend. Sudirman Kav. 54 – 55, Jakarta 12190, Indonesia General: +62 21 526 3445, Fax : +62 21 527 5374 (Equity Sales)

RESEARCH

Adrian Joezer Head of Equity Research, Strategy, Consumer [email protected] +6221 5296 9415 Tjandra Lienandjaja Deputy Head of Equity Research, Banking [email protected] +6221 5296 9617 Ariyanto Kurniawan Automotive, Coal, Metal Mining, Chemical [email protected] +6221 5296 9682 Kresna Hutabarat Telecom, Media [email protected] +6221 5296 9542 Lakshmi Rowter Healthcare, Consumer, Retail [email protected] +6221 5296 9549 Robin Sutanto Property, Building Material [email protected] +6221 5296 9572 Edbert Surya Construction, Transportation [email protected] +6221 5296 9623 Silvony Gathrie Banking, Research Assistant [email protected] +6221 5296 9544 Riyanto Hartanto Poultry, Research Assistant [email protected] +6221 5296 9488 Henry Tedja Research Assistant [email protected] +6221 5296 9434 Wesley Louis Alianto Research Assistant [email protected] +6221 5296 9510 Leo Putera Rinaldy Chief Economist [email protected] +6221 5296 9406 Imanuel Reinaldo Economist [email protected] +6221 5296 9651

INSTITUTIONAL SALES

Silva Halim Managing Director [email protected] +6221 527 5375 Lokman Lie Head of Equity Capital Market [email protected] +6221 527 5375 Andrew Handaya Institutional Sales [email protected] +6221 527 5375 Feliciana Ramonda Institutional Sales [email protected] +6221 527 5375 Henry Pranoto Institutional Sales [email protected] +6221 527 5375 Kevin Giarto Institutional Sales [email protected] +6221 527 5375 Sharon Anastasia Tjahjadi Institutional Sales [email protected] +6221 527 5375 Talitha Medha Anindya Institutional Sales [email protected] +6221 527 5375 Angga Aditya Assaf Institutional Sales [email protected] +6221 527 5375 Ilona Carissa Institutional Sales [email protected] +6221 527 5375 Kusnadi Widjaja Equity Dealing [email protected] +6221 527 5375 Edwin Pradana Setiadi Equity Dealing [email protected] +6221 527 5375 Jane Theodoven Sukardi Equity Dealing [email protected] +6221 527 5375 Michael Taarea Equity Dealing [email protected] +6221 527 5375

RETAIL SALES

Andreas M. Gunawidjaja Head Retail Equities [email protected] +6221 526 9693 Boy Triyono Jakarta [email protected] +6221 526 5678 Dhanan Febrie Handita Bandung [email protected] +6222 426 5088 Yogiswara Perdana [email protected] +62274 560 596 Widodo Solo [email protected] +62271 788 9290 Linawati [email protected] +6231 535 7218 Ruwie Medan [email protected] +6261 8050 1825 Aidil Idham Palembang [email protected] +62711 319 900 Yuri Ariadi Pontianak [email protected] +62561 582 293

INVESTMENT RATINGS: Indicators of expected total return (price appreciation plus dividend yield) within the 12-month period from the date of the last published report, are: Buy (15% or higher), Neutral (-15% to15%) and Sell (-15% or lower).

DISCLAIMER: This report is issued by PT. Mandiri Sekuritas, a member of the Indonesia Stock Exchanges (IDX) and Mandiri Sekuritas is registered and supervised by the Financial Services Authority (OJK). Although the contents of this document may represent the opinion of PT. Mandiri Sekuritas, deriving its judgement from materials and sources believed to be reliable, PT. Mandiri Sekuritas or any other company in the Mandiri Group cannot guarantee its accuracy and completeness. PT. Mandiri Sekuritas or any other company in the Mandiri Group may be involved in transactions contrary to any opinion herein to make markets, or have positions in the securities recommended herein. PT. Mandiri Sekuritas or any other company in the Mandiri Group may seek or will seek investment banking or other business relationships with the companies in this report. For further information please contact our number 62-21-5263445 or fax 62-21-5275374.

ANALYSTS CERTIFICATION: Each contributor to this report hereby certifies that all the views expressed accurately reflect his or her views about the companies, securities and all pertinent variables. It is also certified that the views and recommendations contained in this report are not and will not be influenced by any part or all of his or her compensation.