Equity Research Thursday, June 11, 2015
MORNING HIGHLIGHT
Key Index FROM RESEARCH Chg Ytd Vol Close Waskita Karya: On higher ground (%) (%) (US$ m) (WSKT IJ. Rp 1,670. BUY. TP Rp 2,150) Asean - 5 Post-rights issue, Waskita will be the largest state contractor, thus the Indonesia 4,934 0.7 (5.6) 319 company will have no problems in financing either its future investments or Thailand 1,504 0.8 0.4 951 working capital, ensuring, we believe, a brighter future for the company Philippines 7,384 0.8 2.1 128 and a faster pace of growth. Going forward, Waskita’s ventures into toll Malaysia 1,736 0.4 (1.5) 393 road investments should boost its order book and lead to higher Singapore 3,326 0.9 (1.2) 852 profitability as well. All in all, our post-rights valuation suggests TP of Regional Rp2,150. Waskita remains as one of our Top Picks in our construction China 5,106 (0.1) 57.9 - sector universe. BUY. Hong Kong 26,688 (1.1) 13.1 18,863 Japan 20,046 (0.2) 14.9 15,974 Korea Previous Reports: 2,063 0.5 7.7 5,042 Taiwan 9,299 1.2 (0.1) 3,155 . Market outlook: Finding value (OVERWEIGHT) - Snapshot20150610 India 26,841 1.4 (2.4) 325 . Weekly Report: Not out of the woods yet - Snapshot20150609 NASDAQ 5,077 1.3 7.2 76,008 . Mitra Adi Perkasa: Still in Style- Snapshot20150608 Dow Jones 18,000 1.3 1.0 7,940 . Indosat: Improving Outlook- Snapshot20150605 Currency and Interest Rate . ANTAM: Making Progress on the P3FP projects- Snapshot20150605 w-w m-m ytd Rate . Banking Sector - Tax Issue: Limited Impact- Snapshot20150605 (%) (%) (%)
Rupiah (Rp/1US$) 13,315 (0.6) (1.2) (7.5) MARKET NEWS SBI rate (%) 6.67 (0.3) (0.3) (0.6) 10y Gov Indo bond 8.66 0.2 0.4 0.9 *Analysts’ comment inside . Ministries Need More Funds in 2016 for Infra Projects (TJP) Hard Commodities d-d m-m ytd . Strengthening Capital: BTN Aims Rp9 Trillion Rights Issue (BI) Unit Price (%) (%) (%) . 4W: Sluggish Sales, Manufacturers Reduce Stock (BI) . Ministry of Industry Pushing For 100% Local Content Auto (ID) Coal US$/ton 57 n/a (4.9) (20.5) Gold US$/toz . Freeport to get early extension (TJP) 1,186 0.0 0.2 0.1 Nickel US$/mt.ton . ISAT Plans to Issue Rp2tn Bonds (ID) 13,564 0.8 (4.9) (10.0) Tin US$/mt.ton . PTBA Officially Opens New Port (ID) 15,348 0.8 (3.3) (21.0) . Waskita Aims for More Toll Road Projects to Meet Target (TJP) Soft Commodities d-d m-m ytd Unit Price (%) (%) (%) IDX ANNOUNCEMENT Cocoa US$/mt.ton 3,158 (0.0) 5.4 6.3 Cash Announcement Corn US$/mt.ton 133 (2.6) (2.5) (7.2) Code Ex-Date Date Payable Amount (Rp) Crude Oil US$/barrel 66 (0.3) 0.9 14.3 INDF 19-May-15 11-June-15 220 Palm oil MYR/mt.ton INTP 22-May-15 17-June-15 1350 2,290 (0.1) 6.6 (0.3) Rubber USd/kg KLBF 26-May-15 17-June-15 19 161 1.3 5.6 5.7 Pulp US$/tonne Source: KSEI 851 n/a (0.5) (8.7)
Coffee US$/60kgbag 92 (0.6) 4.5 9.7 Sugar US$/MT 350 0.0 (8.7) (10.7) Wheat US$/mt.ton 189 0.3 7.1 (13.8)
Source: Bloomberg
Danareksa Sekuritas – Equity Research
Equity Research Thursday, June 11, 2015
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Danareksa Sekuritas – Equity Research Thursday, 11 June 2015 CONSTRUCTION SECTOR/COMPANY UPDATE BUY Waskita Karya Target Price, IDR 2,150 Upside 28.7% On higher ground
WSKT IJ/WSKT.JK Post-rights issue, Waskita will be the largest state contractor, thus the company will Last Price, IDR 1,670 have no problems in financing either its future investments or working capital, No. of shares, mn (post-rights) 13,567 ensuring, we believe, a brighter future for the company and a faster pace of growth. Going forward, Waskita’s ventures into toll road investments should boost its order Market Cap, IDR bn 22,657 book and lead to higher profitability as well. All in all, our post-rights valuation (US$ mn) 1,702 suggests TP of Rp2,150. Waskita remains as one of our Top Picks in our construction 3M T/O, US$mn 1.6 sector universe. BUY. Last Recommendation The company that delivers 22-May-2015 BUY IDR 2,100 Backed by its growing order book and sound reputation, Waskita growth story has continued to 04-May-2015 BUY IDR 2,100 unfold and earnings quality has improved. Post-IPO, Waskita successfully restructured its debts 05-Mar-2015 BUY IDR 2,100 and, at the same time, the IPO proceeds gave the company more flexibility in its balance sheet to WSKT relative to JCI Index work on larger projects. Subsequently, Waskita’s total carry-over projects in 2015 stood at Rp20.3tn, or 2.0x its FY14 total revenues – meaning that projects are sufficient to fuel growth. All in all, the IDR WSKT (LHS) Relative to JCI Index (RHS) % 2,000 155 new government’s infrastructure acceleration program should benefit Waskita given that government-related projects remain very important to the company. 115 1,500 Waskita has entered a new era 75 After improving its profitability in recent years, Waskita is also eyeing further improvements by 1,000 35 venturing into toll road investments. To minimize the default risk, Waskita has also taken majority
500 -5 ownership in some sections in order to manage the progress and directly obtain the construction value with higher profitability as well. At present, Waskita has a total of four ongoing toll road 7/9/14 8/6/14 9/3/14 6/11/14 10/1/14 1/21/15 2/18/15 3/18/15 4/15/15 5/13/15 6/10/15 10/29/14 11/26/14 12/24/14 projects in the pipeline, namely: 1) Pejagan-Pemalang, 2) Bekasi-Cawang-Kp. Melayu, 3) Medan- Market Recommendation Kualanamu-Tebing Tinggi, and 4) Depok-Antasari. Most of the projects have already reached critical scale, meaning that the risk of delay is minimal. Aside from these projects, Waskita is also BUY 13 eyeing several potential toll road projects which may transpire in the future.
HOLD 2 The government’s capital injection to accelerate growth As one of the state-contractors, Waskita is an agent of development, especially in regard to toll SELL 4 road development in Indonesia. The government’s capital injection of Rp3.5tn will translate into Consensus a potential rights issue of up to Rp5.3tn given that the government’s stake in Waskita will be Our Cons % Diff undiluted. As a result, Waskita’s equity will increase significantly to Rp8.8tn by EOY15F – making Target price, IDR 2,150 1,908 12.7 the company the largest among the state-contractors. EPS 2015F, IDR 56.2 63.8 -11.9 Post-rights valuation suggests TP of Rp2,150 PE 2015F, x 29.7 26.2 13.4 We forecast Waskita’s net profits to accelerate by 34% CAGR in FY14-17F on the back of a combination of a larger order book size and margins improvement from the contribution coming from higher margin toll road projects. All in all, we continue to value Waskita using the target FY16F PE of 25.7x – at par with 1.0sd above the sector mean during the up-cycle period. Our post-rights valuation suggests fair value of Rp2,150/share. BUY.
2013 2014 2015F 2016F 2017F Revenues, Rp bn 9,687 10,287 14,268 18,568 21,874 EBITDA, Rp bn 725 961 1,440 1,885 2,174 EBITDA Growth, % 26.3 32.6 49.8 31.0 15.3 Net Profit, Rp bn 368 502 762 1,129 1,204 Core Profit, Rp bn 363 488 762 1,129 1,204 Joko Sogie Core EPS, Rp 37.7 50.1 56.2 83.2 88.8 (62-21) 2955 5827 Core EPS Growth, % 63.2 33.1 12.0 48.2 6.7 [email protected] Net Gearing, % 21.1 52.2 Net cash 0.1 3.2 PER, x 43.7 32.4 29.7 20.1 18.8 Danareksa research reports are also Core PER, x 44.3 33.3 29.7 20.1 18.8 available at Reuters Multex and First Call PBV, x 6.7 5.7 2.6 2.3 2.1 Direct and Bloomberg. EV/EBITDA, x 22.9 18.4 14.6 12.0 10.6 Yield, % 0.1 0.7 0.4 0.7 1.0 www.danareksa.com See important disclosure on the back of this report 11 June 2015 Waskita Karya
Post-rights Valuation
Valuing the core business Despite the potential NPV inclusion from Waskita’s toll road investments, we continue to value Waskita based on its core business in general construction services. We consider Waskita’s toll road projects as normal construction works, with higher profitability for the Pejagan-Pemalang and Becakayu toll road sections. We set a 10% gross margin for Waskita’s non-toll road projects, a figure which we believe should be sustainable going forward given the company’s track record and the industry’s characteristics. Meanwhile, we set a 15% gross margin for the civil construction works in the Pejagan-Pemalang and Becakayu toll roads and a 20% gross margin for the precast supplied to the Becakayu toll road.
In our calculation, we have also incorporated the Rp5.3tn equity proceeds from the planned rights issue that will take place in 3Q15F, meaning the company only had high gearing in 1H15. The fact that Waskita has the largest equity size among the state-contractors will allow Waskita to get sizeable contracts going forward, we believe.
As a result, we expect Waskita’s net profits to grow by 34% CAGR in FY14-17F on the back of a combination of a larger order book size and margins improvement from the contribution of higher margin toll road projects. During the period, we expect revenues to grow by 29% CAGR on the back of 15% CAGR in its order book and a higher order book burn- rate to reflect the project’s lifetime. We believe Waskita is perfectly paced to continue its positive growth momentum, bearing in mind the company’s potential high-margin toll road projects and the further acceleration in infrastructure development driven by the government.
Post-rights valuation suggests TP of Rp2,150 All in all, we continue to value Waskita based on Indonesia’s state contractor PE multiple. This method, we believe, can capture the earnings growth cycle, especially during Indonesia’s infrastructure up-cycle starting in 2012. Our PE assumption is based on the listed state- contractors which include Wijaya Karya (WIKA), Pembangunan Perumahan (PTPP), Adhi Karya (ADHI), and Waskita Karya (WSKT). In our view, the Indonesia-listed state-contractors are the best comparisons given that they are exposed to similar project characteristics and the cyclical nature of Indonesia’s construction industry, regulations and market risk. The period we consider starts in 2012, when the government during the President Susilo Bambang Yudhoyono (SBY) era started to disburse large infrastructure funds during the initiation of MP3EI (Master Plan for Acceleration and Expansion of Indonesia Economic Development).
Exhibit 1. Construction sector PE multiple during up-cycle period
WSKT IJ Equity Sector Avg +0.5sd +1.0sd 35.0
30.0
25.0
20.0
15.0
10.0
5.0
- Jul-12 Jul-13 Jul-14 Jan-12 Jan-13 Jan-14 Jan-15 Oct-12 Oct-13 Oct-14 Apr-12 Apr-13 Apr-14 Apr-15
Source: Bloomberg
2 11 June 2015 Waskita Karya
We also roll over our Target Price to 2016F to capture the full benefit of Waskita’s rights issue proceeds in the company’s financials. We believe that earnings visibility from its order book remains sound with the ongoing projects in the pipeline. We set the target PE at 25.7x – 1.0sd above the sector mean given Waskita’s strong earnings growth (above the industry average). Utilizing the target PE with our FY16F earnings estimate, our post-rights valuation suggests fair value of Rp2,150/share. BUY.
Exhibit 2. Our valuation for Waskita
Net income FY16F, Rp bn 1,129 Sector PE: Average, x 19.4 Sector PE: Std. deviation, x 6.3 Waskita Target PE: Average + 1.0 SD, x 25.7 Total shares –post rights issue, bn 13.6 Waskita Target Price, Rp/share 2,150
Source: Company, Danareksa Sekuritas
Toll road calculation Given that Waskita’s intention to venture into the toll road business is to obtain construction works, we do not value the potential contribution of these toll roads after they commence operation. However, our back-of-the-envelope calculation shows that the Pejagan-Pemalang and Becakayu toll road projects have resulted in NPV of Rp1,203bn and Rp937bn, respectively. In our calculations, the projects also show good IRR for toll road projects with the Pejagan- Pemalang toll road giving a 14.9% IRR and the Becakayu toll road a 13.7% IRR. We utilize the assumption of daily vehicles given by the company with the tariffs assumed to be set in the agreement. The valuation is for the period up to the end of the concession agreement.
Exhibit 3. Our main assumptions in the Pejagan-Pemalang and Becakayu toll roads
Section Pejagan-Pemalang section 1 & 2 Bekasi-Cawang-Kp. Melayu section 1 Base volume, vehicle/day 35,000 70,000 Base tariff, Rp/vehicle 12,000 13,000 Length, km 20.2 of 57.5 11.0 of 21.0 Concession, years 45 45 Total investment, Rp bn 2,340 5,257 WACC, % 11.8 12.4 NPV, Rp bn 1,203 937 IRR, % 14.9 13.7
Source: Danareksa Sekuritas
Exhibit 4. Pejagan-Pemalang toll road section 1 and 2 NPV calculation
Pejagalan - Pemalang 2014 2015F 2016F 2017F 2018F 2019F 2020F 2021F … 2060F 2061F
Period 0 1 2 3 4 5 44 45 Revenues - - 38 199 291 350 482 578 12,627 9,565 Operating income - - 6 48 94 123 189 237 6,262 4,744 EBITDA - - 19 100 146 175 241 289 6,314 4,783 (-) Tax - - (5) (25) (36) (44) (60) (72) (1,578) (1,196) (-) Capex maintenance - - (4) (14) (15) (16) (16) (17) (115) (91) FCFF (468) (1,170) (691) 61 94 116 164 200 4,620 3,496
Source: Danareksa Sekuritas
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Exhibit 5. Becakayu toll road section 1 NPV calculation
Bekasi-Cawang-Kp. Melayu 2014 2015F 2016F 2017F 2018F 2019F 2020F 2021F 2022F … 2061F 2062F
Period 0 1 2 3 4 5 44 45 Revenues - - - 83 399 552 662 901 1,081 23,868 18,080 Operating income - - - 12 82 159 214 334 424 11,817 8,952 EBITDA - - - 42 199 276 331 450 540 11,934 9,040 (-) Tax - - - (10) (50) (69) (83) (113) (135) (2,983) (2,260) (-) Capex maintenance - - - (2) (9) (9) (10) (10) (11) (72) (56) FCFF (526) (1,577) (2,103) (1,022) 141 198 239 328 395 8,879 6,723
Source: Danareksa Sekuritas
Risks to rating and price target Key risks include: 1) Risks associated with infrastructure projects such as changes in government regulations, political issues, government budget plans, and land acquisition issue; 2) Rising raw material prices; 3) Interest rate risk; and 4) Risks related to the PPTR and KKDM agreement in regards
4 11 June 2015 Waskita Karya
The Company that delivers
Listed in 2012, Waskita has managed to deliver on its promises made at that time. As a result, the company’s growth story has continued to unfold and earnings quality has improved, backed by its growing order book and sound reputation.
Indonesia’s infrastructure story The government led by President Joko Widodo has made infrastructure acceleration a major priority in a bid to ease logistics costs and boost economic growth from the current 4-5% to 7% by 2019. Indonesia is plagued by a lack of quality and quantity of infrastructure, thus resulting in high logistic costs making Indonesian business less competitive compared to regional counterparts. The infrastructure development in the country would cause a multiplier effect in the economy and thus lead to accelerated growth. Nonetheless, under his term, President Joko Widodo aims to construct 3,250km of new railways, 2,650km of new roads, 1,000km of new toll roads, 28 dams, 24 seaports, and a total of 35,000MW power plants.
Exhibit 6. The Jokowi infrastructure goals
Development Targets Unit Baseline Target 2014 2019 Food Sovereignty Irrigation Development, Improvement and Rehabilitation Development of irrigation networks mn ha 8.90 9.89 Rehabilitation of irrigation networks mn ha 2.71 3.01 Reservoir development 21 49
Maritime and Marine Developing national connectivity Port development to support marine highway - 24 Development of ferriage harbor 210 270
Basic Infrastructure and Connectivity Basic Infrastructure Generator capacity GW 50.7 86.6 Electrification ratio % 81.5 96.6 Household gas network SR 102,000 192,000 Houses backlog mn 13.5 6.8
Connectivity Development of national roads km 38,570 45,592 Construction of new roads (cumulative 5-year) km 1,202 2,650 Toll road development (cumulative 5-year) km 807 1,000 Railway length km 5,434 8,692 Port Development 278 450 Number of airports 237 252 Number of ferriage dock 210 275 Logistic cost % of GDP 23.5 19.2
Source: State Ministry of National Development Planning
The short-term goals are defined in the revised 2015 state budget – especially within the budget allocations for the ministries and government bodies. In the past five years, the government’s expenditures for ministries has increased by 14% CAGR from Rp1,042tn in 2010 to Rp1,984tn in 2015. The Ministry of Public Works and the Ministry of Transportation are the main ministries responsible for infrastructure development. During the previous infrastructure master plan (MP3EI) that started in May 2011, these two ministries spent a total of Rp392tn from 2011-2014 with the combined budget allocation increasing significantly by 23% CAGR from only Rp48tn in 2010 to Rp111tn in 2014.
5 11 June 2015 Waskita Karya
In 2015, with the freed-up funds from the reduction of fuel subsidies, the budget allocation for both the Ministry of Public Works and the Ministry of Transportation has increased dramatically by 57% and 80%, respectively, compared to 2014’s revised budget. In total, the government budgeted Rp182tn for these two ministries in 2015. This amount is 40% higher than the initial budget and 64% higher than the figure in 2014’s revised budget. The combined budget represents 24% of the government’s ministries expenditure in 2015, up from the 15% allocated in 2010. This large allocation of funds demonstrates the government’s commitment to accelerate the nation’s infrastructure development, creating significant opportunities, especially for state-owned companies.
Exhibit 7. Large budget allocation for infrastructure development in 2015
Public Works and Transportation, Rp tn Growth, % (RHS) Public Works Others 200 70 and 20% Transportation 180 60 Finance 24% 160 50 3% 140 40 Social Affair 120 30 4% 100 Defense Agriculture 20 12% 80 4% 10 60 Healthcare 0 40 7% Education -10 12% 20 National Police Religious Affair 0 -20 7% 7% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015F
Source: Ministry of Finance Based on GDP breakdown by sector, the largest contribution in 2014 came from manufacturing at 24% of total nominal GDP. The contribution from construction to nominal GDP has increased from 6.0% in 2001 to 10.7% in 2014. Over the years, growth in the construction sector has outpaced GDP growth, providing a large market for construction activities in Indonesia. Going forward, potential cuts in interest rates should help propel growth in the construction sector since demand for housing and high-rise buildings will increase. Low interest rates mean cheap financing which, in turn, boosts demand for landed property, apartments, and even office space.
Exhibit 8. Construction outpaced the total GDP growth
Construction to GDP Nominal, % GDP (RHS) Construction (RHS)
11 10 9 10 8 9 7 8 6 5 7 Real y-y, growth % 4 6 3
5 2 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Source: CEIC, BPS
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Waskita solid track record Waskita has a solid track record in Indonesia’s construction business with more than 50 years of experience covering construction activity nationwide. The company’s expertise is mainly in general construction services, including toll roads, dams, bridges and high rise buildings. Having such a strong track record, Waskita should benefit further from acceleration in Indonesia’s infrastructure development, a key component of President Joko Widodo’s strategy to spur economic growth.
Among the state-owned contractors, Waskita is the most dependent on the construction business since more than 90% of its revenues are derived from construction services. Being a state-owned contractor provides Waskita with an advantage in acquiring government- related projects, from the central state budget, the provincial state budget, as well as other state-owned projects. Competition mainly comes from the other listed state-owned contractors, namely: Wijaya Karya (WIKA), Pembangunan Perumahan (PTPP), Adhi Karya (ADHI), and non-listed contractors like Hutama Karya (HK).
Exhibit 9. Waskita is a pure construction play
2010 2014
100 92 86 78 80
60
38 40
% Construction revenue only revenue Construction % 20
0 Waskita WIKA PTPP ADHI
Source: Companies
The bulk of Waskita’s order book is from government-related projects, which have in recent years enjoyed strong upward momentum. Based on the new contracts, the main customers of Waskita are government-related, namely the central government, regional government, and other state-owned companies. More than 70% of the total new contracts are government- related, and have been quite stable in recent years. Both government and SOE projects have minimal risk in terms of default on payments as they reflect sovereign risk. Private projects, by comparison, have higher default risk. In the past five years, Waskita’s new contracts achievement has tripled from Rp6.1tn in 2009 to Rp22.6tn in 2014, growing a solid 30% CAGR. Accordingly, Waskita’s order book has recorded 28% CAGR from only Rp9.5tn in 2009 to Rp33.1tn in 2014.
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Exhibit 10. Waskita’s order book is dominated by government-related projects
Government SOE Private 100
80 18 16 23 22 60 11 39 27 40 62 66 56 55 56 New contracts by owner, % owner, by contracts New 20 34 35
0 2008 2009 2010 2011 2012 2013 2014
Source: Company
Exhibit 11. Waskita’s growing order book
Rp tn Carry over New contracts
35
30
25 22.6 20
15 13.3 12.3 10 9.8 6.5 6.1 5 5.7 0 2008 2009 2010 2011 2012 2013 2014
Source: Company
Stronger foundations post-IPO Waskita has entered a new period in the company’s history. Back in 2004-2007, the company faced problems due to some financial misappropriations by its management. The management was then replaced by a new team led by M. Choliq, the ex-finance director of ADHI, starting 2008. Since then, Waskita has been able to turn itself around and move back onto the right track to regain its sound reputation.
Due to some past provisions, the government was forced to inject fresh capital of Rp475bn with funds from PT Perusahaan Pengelola Aset (PPA) in 2009. The capital injection and organizational restructuring helped Waskita to improve its performance. Back then, the company’s strategy was to boost revenues further by remaining competitive. Through its strategy of offering quality works with competitive pricing, Waskita delivered strong growth. Waskita’s total revenues grew from only Rp3.3tn in 2008 to Rp8.8tn in 2012, showing 28% CAGR during the period. At the bottom line, net profits grew eightfold from only Rp32bn in 2008 to Rp254bn in 2012.
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Post-IPO in 2012, Waskita successfully restructured its debts which had surpassed 3x net gearing at that time. At the same time, the IPO proceeds of Rp1.1tn in December 2012 also gave the company more flexibility in its balance sheet to work on larger projects. Nonetheless, since 2012, Waskita has shifted its strategy by focusing on higher quality works, meaning the company has let go its competitive pricing strategy, focusing instead on improving its profitability. In 2012-2014, even though revenues only grew 8% CAGR to Rp10.3tn in 2014, Waskita’s net profits doubled to Rp502bn in 2014, reflecting 41% CAGR.
Exhibit 12. Waskita has delivered strong growth in consecutive years
Revenues, Rp bn Net profit, Rp bn
12,000 +28% CAGR +8% CAGR 600 +68% CAGR +41% CAGR
10,000 500
8,000 400
6,000 300
4,000 200
2,000 100
- 0 2008 2009 2010 2011 2012 2013 2014 2008 2009 2010 2011 2012 2013 2014
Source: Company
Low margins initially, but has continued to pick up The construction business has relatively thin margins compared to other industries. The largest cost component is the COGS which comprises of raw materials (40-45%), the subcontractors costs (30-35%), labor costs (10%), and the rest is overhead costs (15-20%). These components amount to around 90% of the total construction revenues. With high exposure to raw material prices, Waskita protects its margins against price volatility by: 1) using forward contract agreements called ‘umbrella’ contracts to secure both volumes and prices and 2) adopting price escalation for multi-year projects. By comparison, operating costs are only about 3-4% of total revenues.
Exhibit 13. COGS main components
Overhead 17%
Raw materials 40% Salaries 10%
Subcontractor 33%
Source: Company
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Nonetheless, the period of high growth has been no easy ride since the market in the construction industry is in near perfect competition. There are about 125 companies in the large-sized category which handle projects with value above Rp10bn. However, despite the tight competition, Waskita has shown its ability to gain market share through its competitive cost structure and service expertise. The serious competition mainly comes from the other state-owned contractors which have similar know-how, experience, and support from the government.
Consequently, Waskita’s gross margin was relatively low prior to 2012 as the company still concentrated 100% on construction services in addition to adopting a competitive strategy. Normally, the gross margin for construction services ranges from 8-11% for government infrastructure projects. Private projects for high-rise buildings can potentially have higher gross margins of 11-14% but with higher collection risk. Prior to 2012, Waskita’s gross margin was stable at below 10%. At the bottom line, Waskita’s net margin was the second-lowest among the listed state-contractors. In our view, this owed to the company’s strategy of concentrating on construction services and not because of poorer performance. The company’s focus on construction services whilst also having a small equity size pre-IPO meant that Waskita’s needs for working capital financing were also larger than its peers – which led to larger interest expenses that eroded its net margins. Before IPO in 2012, Waskita had the highest net gearing among the listed state-contractors at almost 3x.
Post-IPO in 2012, Waskita has evolved considerably. Waskita continues to look at large-scale projects that give better earnings visibility. Moreover, the company is also looking to exploit its expertise by undertaking vertical integration into higher margin businesses: precast concrete and property. The precast business was started in early 2013, with consumption mostly still internal. In the property business, Waskita has several projects in Alam Sutera, Cawang, Surabaya, and Medan. Subsequently, Waskita’s gross and net margins improved significantly to 10.8% and 4.9%, respectively, in 2014.
Exhibit 14. Waskita’s continuous improvement in profitability
Gross margin Operating margin Net margin 12
10
8
6 4.9 3.8 4 2.9 2.1 2.4 2 1.0 1.1
0 2008 2009 2010 2011 2012 2013 2014 Source: Company
Working capital management remains important Construction activities require significant amounts of financing for working capital requirements given that payments are made based on the percentage of completion. If the project is sourced from the government budget, there would be an additional administrative process to lengthen the payment period. Typically, the working capital requirement will increase from January to September (1Q-3Q) and then decline towards year-end (4Q) as the company receives payments on its receivables. Some minority percentage (5-10%) of receivables will be tied up in the retention account as a warranty over the lifetime of a project.
10 11 June 2015 Waskita Karya
When a company enters contracts to secure prices, at least a 10% down payment is required. Nonetheless, construction companies such as Waskita can withhold payments to subcontractors. Consequently, construction companies - especially the state-companies - need to finance their working capital requirements that can reach up to 150 to 200 days at the peak. Nevertheless, managing working capital more effectively can lead to profitability improvements. Post-IPO, Waskita’s leverage has been much better with the net gearing still standing at 0.8x during the peak quarter in 2014.
Exhibit 15. Net gearing came down post-IPO in 2012
Working capital cycle, days Net gearing, x 250 3.5
3.0 200 2.5
150 2.0 1.5
100 1.0
0.5 50 0.0
0 -0.5 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14
Source: Company
For its financing, Waskita currently has the support mostly from the state-owned banks like Bank Mandiri, Bank BNI, Bank BRI, and several non-state-owned banks. The largest facilities are provided by Bank Mandiri and Bank BNI - each amounting to around Rp4.0tn - consisting of transactional and revolving working capital credit, bank guarantees, L/C, and supply chain financing facility. The interest costs on these facilities range from 9.25-11.00%.
Aside from the short-term support from banks, Waskita also has mid-long term financing through bonds. Currently, the company has Rp1.25tn of bonds with an interest cost of 8.75- 10.40%, with the earliest maturity of the Rp75bn bonds in June 2015 and the rests in 2017.
Exhibit 16. Financing facilities to support working capital
Loan facility(Dec-14) Working capital Non-cash loan Interest rate D/E covenant Outstanding Rp bn Rp bn % x Dec-14, Rp bn
Bank Mandiri 800 3,621 9.95 3.0 358 Bank BNI 1,000 3,200 11.00 5.0 - Bank BRI 300 1,000 10.50 - 255 Indonesia Eximbank 900 - 9.25 3.0 829 BPD Jabar Banten - 250 9.86 - 175 Bank Panin 300 100 JIBOR+3.00 2.5 300 Bank UOB Indonesia 300 350 10.50 3.0 - Bonds – 2014 500 - 10.4 3.0 500 Bonds – 2012 750 - 8.75/9.75 3.0 750 TOTAL 4,850 8,521 3,167
Source: Company
11 11 June 2015 Waskita Karya
Waskita delivered on its promises in 2014 2014 turned out to be a remarkable year for Waskita, recording not only unsurpassed new contracts amidst political challenges but also higher margins thanks largely to the company’s strategic move into toll road projects. While revenues only grew 6% to Rp10.3tn, net profits surged 36% to Rp502bn. The robust bottom line growth mainly stemmed from a better gross margin of 10.8% and the almost twofold increase in JO profits. These improvements were mainly supported by the company’s toll road projects that were initiated in 3Q14. As a result, Waskita could significantly improve its net margin from 3.8% in FY13 to 4.9% in FY14.
In addition to that, in 2014, Waskita was also the best new contracts achiever among the state-contractors. From Rp69tn of new contracts awarded, Waskita dominated with a 32% market share. The company won a total of Rp22.6tn new contracts in FY14, up 68% from FY13’s achievement. In 4Q14, Waskita bagged Rp8.9tn of new contracts, of which Rp4.2tn came from the works of its toll road-owned projects. Nonetheless, total carry-over projects to 2015 are Rp20.3tn, or 2.0x its FY14 total revenues – meaning that projects are sufficient to fuel growth.
Exhibit 17. Waskita’s notable new projects in 2014
Project name Segment Type Value, Rp bn
Bekasi-Cawang-Kp. Melayu Toll road Precast – Toll road 3,046 Frontage Surabaya Civil – Building 1,441 Bekasi-Cawang-Kp. Melayu Toll road Civil – Toll road 1,168 Pejagan-Pemalang Section 1 Toll road Civil – Toll road 1,123 Raknamo Dam Civil – Dam 646 Suai Airport Expansion Civil – Airport 643 Darmo Surabaya Apartment Civil – Building 629 Gondang Dam Civil – Dam 561 Pejagan-Pemalang Section 2 Toll road Civil – Toll road 556 Balikpapan Stadium Civil – Building 545 Oecusse Road Improvement Civil – Road 532 Sopo Del Office Tower Civil – Building 477 Depok-Antasari Package 1 Toll Road (JO) Civil – Toll road 416 Konawe Sugar Factory (JO) Civil – Building 311
Source: Company
Exhibit 18. Waskita headed the new contracts’ league table in 2014
Waskita WIKA PTPP ADHI
100
80
60
40
New contracts market share, % share, market contracts New 20 32.2 19.5 20.5 20.6 21.5 0 2010 2011 2012 2013 2014
Source: Companies
12 11 June 2015 Waskita Karya
Waskita has entered a new era
After improving its gross margin in general construction services in recent years, aside from diversifying into the high margin precast and property businesses, Waskita is also eyeing further margins improvements by venturing into toll road investments. Over the next three years, construction services, especially in the toll road segment will become the core business for Waskita.
Why toll roads? Waskita is one of the country’s major toll road contractors. Having been in the business for decades means that Waskita has a significant advantage since the company knows how to undertake toll road construction works in an efficient manner. Moreover, Waskita also knows how to deal with the land acquisition process as well as handle local issues – key considerations in developing toll roads in Indonesia. On top of that, being a state-owned company also benefits Waskita since it gives the company better access to local governments and makes it easier for Waskita to forge ties with other state-owned companies. Generally, investments in toll road projects by the contractor are seen as the way to secure construction works given the rights-to-match scheme. Through this scheme, the shareholder can directly match the winning bidder’s proposal.
Exhibit 19. Waskita previous toll road projects
Toll road project Completion
Gempol-Pasuruan 2014 Gempol-Porong 2014 Waru-Juanda 2014 Nusa Dua-Benoa Bali 2013 Jakarta Outer Ring Road W2 2013 Pantai Indah Kapuk 2013 Semarang-Bawen 2013 Semarang-Solo 2012 Jakarta Outer Ring Road W1 2010 Ir. Soedyatmo 2010 Manyaran-Jatingaleh 2010 Cikampek-Purbaleunyi-Padalarang 2005 Jakarta Outer Ring Road TMII 2003
Source: Company
However, toll road projects also carry higher risks, especially in relation to project default by the owner. To minimize the risks, Waskita has taken majority ownership in some sections in order to manage the progress and directly obtain the contract value from the construction works with higher profitability as well. Given its multi-years project timeline, the toll road projects will support Waskita’s order book at least over the next three years period. As mentioned before, the toll road projects will be positive for Waskita up to the completion date if there are no delays given the large size of the contracts and because of their high profitability. Thus, toll road projects will not only significantly lift the company’s order book size, but profitability as well.
At present, Waskita has a total of four toll road projects in the pipeline, namely: 1) Pejagan- Pemalang, 2) Bekasi-Cawang-Kp. Melayu, 3) Medan-Kualanamu-Tebing Tinggi, and 4) Depok-Antasari. Most of the projects have already reached critical scale, meaning that the land acquisition is already above 75% completion and the construction works have already been taking place since early this year, meaning the risk of delay is minimal.
13 11 June 2015 Waskita Karya
Exhibit 20. Toll road projects in the pipeline
Section Length Owned Paid-in capital Investment Construction Target IRR Km % Rp bn Rp bn Rp bn %
Pejagan-Pemalang 57.5 99.9 300.0 2,340 1,679 16.50 Bekasi-Cawang-Kp. Melayu 21.0 60.0 240.0 5,257 4,214 15.13 Medan-Kualanamu-Tb. Tinggi 61.7 15.0 12.0 4,072 3,101 14.50 Depok-Antasari 21.5 12.5 50.0 4,085 3,772 16.75
Notes: *Investment and construction costs amounted in Pejagan-Pemalang for section 1 and 2; Bekasi-Cawang-Kp. Melayu for section 1
Source: Company
Waskita-owned toll road projects: Pejagan-Pemalang and Bekasi-Cawang-Kp. Melayu Waskita through its subsidiary, PT Waskita Toll Road (WTR), holds the majority ownership in two toll road concessions through the Conditional Sale and Purchase Agreement (CSPA) with call option, namely in: 1) PT Pejagan Pemalang Toll Road (PPTR), the concession holder of the Pejagan-Pemalang toll road and 2) PT Kresna Kusuma Dyandra Marga (KKDM), the concession holder of the Bekasi-Cawang-Kp. Melayu (Becakayu) toll road. Because of the call option held by its previous owner, Waskita is not the controlling shareholder. Nonetheless, during the construction period, Waskita as the direct contractor is able to book the toll road project – both civil works and precast sales – as earnings. As the two toll road projects are self-financing, Waskita will deliver them as turnkey projects. Encouragingly, the gross margins offered by these toll road projects are better than the normal ones both for the civil works and the precast used.
Upon completion, the Pejagan-Pemalang and Becakayu toll roads have good potential IRR in view of the traffic congestion in those areas which will support the traffic feeder. The Pejagan-Pemalang toll road will connect with the in-operation Kanci-Pejagan section which will be supported by soon-to-be operation of the Cikampek-Palimanan toll road that we believe should boost traffic from West Java to Central Java. Meanwhile, Becakayu’s traffic will be supported with the Jakarta Inner Ring Road and the Jakarta-Cikampek toll road – the two most congested toll roads in the Greater Jakarta toll road network. Normally, more integration means higher traffic. Again, there are no doubts regarding the traffic volumes on these two toll roads.
We believe these two owned toll road investments will be good in the long-run as they are likely to be a significant cash generator for Waskita. However, short-term profitability will be affected due to the negative earnings during the early years of the operation given the huge upfront investment. However, from a long-term perspective, the toll roads business is very promising.
Pejagan-Pemalang (99.9% owned) Linking Pejagan and Pemalang in Central Java, the 57.5km Pejagan-Pemalang toll road is one of the key sections of the Trans Java toll road network. Construction will be divided into four sections: 1) the 14.2km Pejagan-West Brebes section, 2) the 6.0km West Brebes-East Brebes section, 3) the 10.4km East Brebes-East Tegal section, and 4) the last 26.9km East Tegal- Pemalang section.
The Pejagan-Pemalang toll road will be connected with the in-operation Kanci-Pejagan toll road on the west side and the in-progress Pemalang-Batang toll road on the east side. Nevertheless, the traffic feeder for this toll road will mainly come from the west side, given the Trans Java toll road network has been established from Merak on the western side of Java to Pejagan in Central Java. The completion of the 116km Cikampek-Palimanan toll road in mid-2015 will establish the missing link in the West Java toll road network. The daily traffic
14 11 June 2015 Waskita Karya
on the Pejagan-Pemalang toll road could potentially reach between 30-50k vehicles/day as seen in the daily traffic for Palimanan-Kanci. However, the Kanci-Pejagan toll road has faced some difficulties with traffic only reaching 10k vehicles/day since its operation in 2010 given its bumpy contours. However, the MNC Group - who also owns the Kanci-Pejagan toll road - has shown good faith to meet the minimum service standard when the Pejagan-Pemalang toll road is completed. Nevertheless, we believe the Pejagan-Pemalang toll road will have at least similar traffic volume as the Palimanan-Kanci toll road given the toll road interconnection and in view of the congestion that usually occurs on the northern Java national road (Pantura).
Exhibit 21. Pejagan-Pemalang roadmap
Section I Section II Section III Section IV
14.2 km 6km 10.4 km 26.9 km
Pejagan West Brebes East Brebes East Tegal Pemalang Source: Company
Waskita acquired PPTR through WTR from PT Global Selaras Dunia and PT Rekatunggal Abadi in July 2014, both of which were part of the MNC Group. Based on the CSPA with PPTR’s Right to Buy Back, it is stated that the owners of PPTR (PT Global Selaras Dunia and PT Rekatunggal Abadi) sell and transfer their shares to WTR amounting to 99.9% at the agreed price. The MNC Group has the right to buy back the shares from the purchase period signing date up until the third anniversary of the acquisition of shares agreement. Initially, MNC Group acquired PPTR in December 2012 from PT Bakrie Toll Road, a member of the Bakrie Group. Bakrie Toll Road was entitled to ownership of PPTR since January 2009.
Based on the CSPA, Waskita paid consideration of Rp300bn in an option purchase agreement with the intention solely to secure the construction works for the first and second sections. In the agreement, MNC Group has a call option for the project of Rp459bn at the time of the third anniversary in July 2017. If the call option is exercised before, Waskita may get additional interest of 14.25% from the remaining project value. Nonetheless, in 2017, Waskita will get the investment return of Rp459bn plus the value of the construction works for the project.
Exhibit 22. Waskita’s agreement in PPTR
Toll road Pejagan-Pemalang Section Pejagan-West Brebes (Section 1; 14.2km) West Brebes-East Brebes (Section 2; 6.0km) Total length, km 57.5 Owner Pejagan Pemalang Toll Road (PPTR) WTR ownership, % 99.9 Initial investment, Rp bn 300.0 Start date 27-Jun-14 Buyback date 27-Jun-17 Buyback period 36 months Buyback value, Rp bn 458.8 Construction value, Rp bn 1,679 Source: Company
15 11 June 2015 Waskita Karya
The land acquisition process for the first two sections from Pejagan to East Brebes has been nearly completed, and Waskita started construction in 3Q14. Total investment in the first two sections is earmarked at Rp2,340bn, with total construction value of Rp1,679bn, of which Waskita has been included in its order book progress since 3Q14. Meanwhile, the remaining two sections from East Brebes to Pemalang are still in the land acquisition process – which is not part of Waskita’s agreement.
Exhibit 23. The construction progress of Pejagan-Pemalang section 1 and 2
Source: Company Bekasi-Cawang-Kampung Melayu (60.0% owned) The Bekasi-Cawang-Kampung Melayu toll road is part of the oldest toll road concession in the country that hasn’t gone into operation. The 1998/99 financial crisis delayed investment in the Becakayu toll road since the owner could not get loans from banks, which caused the project’s postponement after some progress had been made. Connecting the densely-populated area of Bekasi in the eastern part of Jakarta to the economic center in East Jakarta, the 21km Becakayu toll road will be built in an elevated fashion by the Kalimalang area in eastern Jakarta. The construction stage will be divided into two sections: 1) the 11km Casablanca-Jakasampurna section and 2) the 10km Jakasampurna-Duren Jaya section.
The Becakayu toll road will be connected to high-traffic toll road - the Jakarta Inner City toll roads - which had daily traffic of almost 550k vehicles/day in 2014. Interestingly, Bekasi as a major supporting area of Jakarta also has a total of 2.1mn daily commuters, who generally use the Commuter Line provided by PT Kereta Api Indonesia, public bus transportation, or their own vehicles – either through the Kalimalang area or the Jakarta-Cikampek toll road to connect with the Jakarta Inner City toll road which is usually very congested during peak hours. Nevertheless, we believe traffic volume shouldn’t be an issue, with potential daily traffic potentially around 70-90k vehicles/day during its first year of operation.
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Exhibit 24. Bekasi-Cawang-Kp. Melayu roadmap
Source: Company
Like in the PPTR agreement, based on the CSPA with the Right to Buy Back shares belonging to PT Kresna Kusuma Dyandra Marga (KKDM), it is stated that WTR owns the 60% ownership in KKDM while the remaining ownership belongs to the previous owners which related to Kapal Api Group, namely: PT Tirtobumi Prakarsatama (15.0%), PT Citra Mandiri Sukses Sejati (12.0%), PT Indadi Utama (6.0%), PT Remaja Bangun Kencana (6.0%), and Jasa Marga (1.0%). The previous owners have the right to buy back the shares in the purchase period from the signing date until the third anniversary of the acquisition of the shares agreement.
Based on the CSPA, Waskita paid Rp240bn in an option purchase agreement to own and undertake the construction works for the Becakayu toll road for the first section. Any time from the signing date in December 2014 until six months after the date of completion in the next 36 months (July 2018), the previous owners have a call option for the project at Rp449bn. However, if the call option is exercised before that, the previous owners agree to pay the transaction value that will be decided in the future. Nonetheless, between late-2017 until mid-2018, Waskita will get the investment return of Rp449bn plus the value of the construction works from the project.
Exhibit 25. Waskita’s agreement in KKDM
Toll road Bekasi-Cawang-Kp. Melayu Section Casablanca-Jakasampurna (Section 1; 11.0km) Total length, km 21.0 Owner Kresna Kusuma Dyandra Marga (KKDM) WTR ownership, % 60.0 Initial investment, Rp bn 240.0 Start date 17-Oct-14 Buyback date 17-Apr-18 Buyback period 36 months + 6 months Buyback value, Rp bn 449.0 Construction value, Rp bn 4,214
Source: Company
17 11 June 2015 Waskita Karya
The land acquisition process for the first section from Casablanca to Jakasampurna has been nearly completed, and Waskita started construction in 4Q14. Total investment in the first section will reach Rp5,257bn, with total construction value reaching Rp4,214bn. The construction value will be divided in two terms: the civil works worth Rp1,168bn and the precast procurement worth Rp3,046bn. The last (second) section from Jakasampurna to Duren Jaya is still in the land acquisition process – which is not part of Waskita’s agreement.
Exhibit 26. The construction progress of Becakayu section 1
Source: Company The minority ownerships: Depok-Antasari and Medan-Kualanamu-Tebing Tinggi Besides the two majority-owned toll roads, Waskita also has some minority shares in another two toll roads: 1) Depok-Antasari (12.5% owned) and 2) Medan-Kualanamu-Tebing Tinggi (15.0% owned). Construction of the Depok-Antasari toll road started in late-2014, while construction of the Medan-Kualanmu-Tebing Tinggi toll road is expected to begin in mid-2015.
The Depok-Antasari construction works were awarded in 2014’s JO project worth Rp416bn, while the Medan-Kualanamu-Tebing Tinggi construction works shall be awarded in mid- 2015 amounting to Rp1.0tn. After the completion of the toll roads, Waskita plans to divest its ownership to leverage its equity base further.
Depok-Antasari (12.5% owned) The Depok-Antasari (Desari) toll road is one of the crucial sections in the southern part of Jakarta, as it will connect the densely populated Greater Jakarta area from Depok to the South Jakarta area in Antasari, previously connected only by ordinary roads. Once completed, Desari will also connect to the Jakarta Outer Ring Road network, feeding more traffic into this toll road.
Waskita has held a minority 12.5% shareholding in PT Citra Waspphutowa (Citra) since 2006. Citra is the concession holder of the 21.5km Desari toll road which has been delayed in recent years due to the surge in land prices that has hampered the land acquisition progress. The majority shareholder of this project is PT Citra Marga Nusaphala Persada (CMNP), one of Indonesia’s toll road operators which has a 62.5% ownership. The other shareholders are PTPP and HK which each have 12.5% ownership. As of December 2014, Waskita’s paid-in capital amounted to Rp50bn for the company’s 12.5% ownership.
18 11 June 2015 Waskita Karya
Desari toll road will involve an investment cost of Rp4.1tn with Rp3.8tn as the construction cost for all the sections. The toll road will be developed in two stages, with the first section from Antasari to Krukut (8.4km) constructed first with a total construction cost almost reaching Rp2.0tn. In mid-2014, the consortium commenced groundbreaking after the land acquisition progress reached above 70%. Nevertheless, the JO construction works of the first stage have been distributed among the three participating contractors.
Exhibit 27. Depok-Antasari roadmap
Section I Section II
Antasari 3.5 km Andara 4,9 km Krukut 3.6 km Sawangan 9,5 km Bojong Gede
Source: Company, Citra Marga Nusaphala Persada
Exhibit 28. Depok-Antasari details
Toll road Depok-Antasari Total length, km 21.5 Owner Citra Waspphutowa Waskita ownership, % 12.5 Paid-in capital, Rp bn 50.0 Total investment, Rp bn 4,085 Total construction, Rp bn 3,772 Target IRR, % 16.75
Source: Company
Medan-Kualanamu-Tebing Tinggi (15.0% owned) The planned 62km Medan-Kualanamu-Tebing Tinggi toll road will connect the North Sumatera capital of Medan to Tebing Tinggi with an interchange to the Kualanamu airport, Indonesia’s newest and second largest international airport developed in late-2013. This toll road is seen as very strategic since it provides a faster alternative from the Kualanamu International Airport to the economic hub of Medan as the current road is in poor condition, while the new airport express train service is quite expensive (Rp55-100k/trip). Besides this, this section will also be part of the Trans-Sumatera toll road network through its connection to Tebing Tinggi.
The development process will be divided into two major stages to hasten the construction process. The first section from Tanjung Morawa to Kualanamu is 17.8km long and the second section from Parbarakan to Tebing Tinggi is 43.9km long. Interestingly, the central government is participating through the viability gap fund (VGF) to make the project commercially viable. Hence, only 44km will be done by the private sector. Nevertheless, the total investment cost is estimated to only reach Rp4.1tn with potential construction costs up to Rp3.1tn.
The groundbreaking ceremony started in September 2014, with the construction period targeted to begin in mid-2015 and scheduled to be finished in 2018 since most of the land acquisition process has been done by the government. PT Jasa Marga Kuala Namu Tol has
19 11 June 2015 Waskita Karya
been assigned to develop this project. In this JV, a 55.0% stake is taken by Jasa Marga, with the remaining 45.0% distributed equally between the state-owned contractors, i.e.: Waskita, PTPP, and HK. Subsequently, the construction works will be well distributed among those three contractors. As of December 2014, Waskita’s paid-in capital in this project amounted to Rp12.0bn.
Exhibit 29. Medan-Kualanamu-Tebing Tinggi roadmap
Source: Company
Exhibit 30. Medan-Kualanamu-Tebing Tinggi details
Toll road Medan-Kualanamu-Tebing Tinggi Total length, km 61.7 Owner Jasa Marga Kuala Namu Tol Waskita ownership, % 15.0 Paid-in capital, Rp bn 12.0 Total investment, Rp bn 4,072 Total construction, Rp bn 3,101 Target IRR, % 14.50 Source: Company, BPJT
Future planned projects in the pipeline Apart from the four ongoing toll road projects, Waskita is eyeing several potential toll road projects to be included in its portfolio to ensure the sustainability of its order book. Most of the potential toll roads are located in the Trans Java toll road network given its potential integration capacity and traffic load. Waskita will not undertake the investments alone, meaning the company is looking for partnerships either with other state-owned companies or private investors.
Legundi-Bunder: Waskita as the initiator Waskita is the initiator for the Legundi-Bunder toll road located in East Java. The toll road will span 29.3km from Legundi (Krian) to Bunder (Gresik) and will also connect with Teluk Lamong and the Tanjung Perak port, as the traffic feeder for the toll road. With this toll road, the flow of goods from East Java to the Tanjung Perak port will no longer need to pass the Surabaya toll road, as they can go directly through Legundi to Bunder to the Tanjung Perak port. The construction of this toll road is deemed necessary to relieve the traffic congestion from the port to the city.
20 11 June 2015 Waskita Karya
Initially, Waskita through WTR cooperated with a mining company, PT Energi Bumi Mining to create a JV named PT Waskita Bumi Legundi (WBL) to initiate the Legundi-Bunder toll road. WTR has a participation of 60.0% in WBL with initial investment of Rp7.5bn. In November 2014, WTR no longer consolidated WBL’s business given the inclusion of the East Java provincial- owned company, PT Panca Wira Usaha Jawa Timur into the JV with additional paid-in capital of Rp3.1bn. As a result, the ownership of WTR was reduced from 60.0% to 48.0%, and consequently the name of PT Waskita Bumi Legundi changed to PT Waskita Bumi Wira. Currently, as most of the land bank is still owned by the East Java provincial government, the participation of the provincial government is highly needed to hasten the land acquisition process needed for the construction.
Currently, the JV is still seeking to obtain environmental permission as well as the appointment from BPJT. Construction is targeted to start in late-2015 with completion in 2018. The project’s investment cost is estimated at Rp4.3tn with a total construction cost of Rp2.6tn. Given Waskita is the initiator as well as the owner of this project, all of the construction works will be done solely by Waskita.
Exhibit 31. Legundi-Bunder roadmap
end
start
Source: Company
Exhibit 32. Legundi-Bunder details
Toll road Legundi-Bunder Total length, km 29.3 Owner Waskita Bumi Wira Waskita ownership, % 48.0 Paid-in capital, Rp bn 7.5 Total length, km 29.2 Total investment, Rp bn 4,292 Total construction, Rp bn 2,646 Target IRR, % 15.5
Source: Company
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Solo-Ngawi and Ngawi-Kertosono: Fully acquired The Solo-Ngawi-Kertosono (Soker) toll road is part of the Trans Java toll road network, where in the west it connects to the Semarang-Solo toll road and in the east to the Kertosono- Mojokerto toll road. The Soker toll road has a total length of 177km spanning from Central Java to East Java, comprising of two sections, namely: 1) the 90km Solo-Ngawi section and 2) the 87km Ngawi-Kertosono section.
The Soker toll road is also the first Public-Private Partnership (PPP) project in Indonesia’s toll road development. As part of the PPP deal, the government will build one-third of the toll road as well as shoulder the land acquisition costs. As a result, the concessionary holder only needs to construct around 119km of toll road, but will operate and generate income from the total length of the toll road at almost 180km. The total investment needed to construct the 69.2km Solo-Ngawi section is Rp5.1tn, while the investment for the 49.5km Ngawi- Kertosono section will require Rp3.8tn. In sum, the total investment needed is Rp8.9tn.
PT Thiess Contractors Indonesia won the tender for the project back in 2011. Thiess then established PT Solo Ngawi Jaya as the owner of the concession for the Solo-Ngawi section and PT Ngawi Kertosono Jaya as the owner of the concession for the Ngawi-Kertosono section. Initially, Thiess aimed to finish the project in 2014, but was only able to acquire 80% of the land needed during the period. With the lack of progress, the government called on Thiess to sell the concessionary rights in early 2015.
Jasa Marga and Waskita spent about Rp439bn to acquire the toll road project from Thiess with an ownership composition of 60% Jasa Marga and 40% Waskita. Jasa Marga will begin the construction works in 3Q15. The groundbreaking ceremony was held in late-April 2015 and was attended by President Joko Widodo, who called for the toll road development to be completed by the end of 2017.
At present, the land acquisition progress has reached 92% for the Solo-Ngawi section while for the Ngawi-Kertosono section progress still stands at only 48% with full land clearance expected by the end of 2016. When the toll road is finally operated, it will be the longest toll road in Indonesia.
Exhibit 33. Solo-Ngawi-Kertosono roadmap
Source: Company
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Exhibit 34. Solo-Ngawi-Kertosono details
Toll section Solo-Ngawi / Ngawi-Kertosono Owner Solo Ngawi Jaya / Ngawi Kertosono Jaya Total length, km 177.0 Waskita ownership, % 40.0 Paid-in capital, Rp bn n/a Total length, km 177.0 Total investment, Rp bn 8,970 Total construction, Rp bn n/a Target IRR, % 14-15.0
Source: Company, BPJT
Cinere-Serpong toll roads from Thiess Indonesia Besides the Soker toll road, Thiess also has another toll road concession in the 10.1km Cinere- Serpong toll road under PT Cinere Serpong Jaya. The Cinere-Serpong toll road is part of the Jakarta Outer Ring Road Phase II but the land acquisition progress is still lacking even though the concession was given back in 2011 owing to difficulties given that it passes through a densely populated area. Initially, Thiess had targeted operation of the toll road in 2015.
Nonetheless, Jasa Marga partnering with Waskita sees this toll road as a possible future acquisition. If this materializes, then the Cinere-Serpong toll road will be connected to Jasa Marga’s upcoming Cengkareng-Kunciran-Serpong toll road, which is also part of the Jakarta Outer Ring Road Phase II. Aside from Jasa Marga, several other investors have also expressed an interest in buying this concession, including PT Astratel Nusantara, an infrastructure unit of Astra International, and PT Nusantara Infrastruktur, an Indonesian integrated infrastructure company. Jasa Marga has offered to take up the majority stake, inviting also Waskita and Jakarta Propertindo to take the minority stake. The total investment cost in this toll road is estimated to reach Rp2.2tn.
Exhibit 35. Cinere-Serpong roadmap
Source: Company, Jasa Marga
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Another MNC Group toll road Back then, for its toll road business, in addition to the Kanci-Pejagan toll road which officially commenced operation in 2010, PT Bakrie Toll Road, a member of the Bakrie Group also had several toll road concessions under construction, namely Pejagan-Pemalang, Batang- Semarang, Pasuruan-Probolinggo, and Ciawi-Sukabumi. At that time, the Bakrie Group was burdened with high interest charges during the toll road construction period and in its first years of operation. To better focus on its core business, the Bakrie Group sold its toll assets worth Rp2tn to the MNC Group at the end of 2012 with the name then changed from PT Bakrie Toll Road to PT MNC Toll Road. As such, the MNC Group has owned the five toll roads since 2012 with only the Kanci-Pejagan toll road in operation.
Among those sections, Waskita has purchased the Pejagan-Pemalang toll road which is currently under construction. In the meantime, Waskita is also interested in buying the 54km Ciawi-Sukabumi toll road and the 75km Batang-Semarang toll road given the large size of its construction works. The total investment in the Ciawi-Sukabumi toll road is estimated to reach Rp7.8tn with the investment in the Batang-Semarang toll road estimated at Rp7.2tn.
Nonetheless, the possibility of Waskita acquiring the Ciawi-Sukabumi toll road is quite slim at the moment given that the MNC Group began construction in early 2015. The Ciawi- Sukabumi toll road is a planned 54km extension of the Jakarta-Bogor-Ciawi (Jagorawi) toll road and will connect Ciawi and Sukabumi in West Java, thereby easing traffic congestion along the route actively used for the distribution of goods. The MNC Group has been working on the construction of the toll road, beginning with the first phase of a 15km Ciawi- Cigombong section given MNC’s planned theme park in the Lido area, Bogor (West Java). The toll road is targeted to be in full operation by the end of 2016 – quite an optimistic target, in our view, given the lack of progress in land acquisition.
Exhibit 36. Ciawi-Sukabumi roadmap
Source: Company
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The interconnection of the Pejagan-Pemalang: Pemalang-Batang-Semarang toll roads Since the concession was given in 2006, the land acquisition progress for the Pemalang- Batang and Batang-Semarang toll roads has been very low, at below 5% in the past ten years. The lack of interconnections with the central economy in western Java has hindered toll road development, reducing the urgency of the owners to start the construction works. However, the upcoming completion of the Pejagan-Pemalang toll road is expected to feed traffic into these sections, creating potentially lucrative investments in these projects.
As part of the Trans Java toll road network which is targeted by the government to be fully connected in 2017, these two sections may be the most problematic. As such, the government has given an ultimatum to the toll road owners to start construction by the end of 2015 else the concessionary rights will be cancelled and re-tendered.
The Pemalang-Batang toll road and the Batang-Semarang toll road will require sizeable investments of Rp4.1tn and Rp7.2tn, respectively. Waskita’s interest in these toll roads mainly stems from the government’s pressure on the owners to start construction as soon as possible, as well as the company’s intention to secure sizeable construction works.
Exhibit 37. Pemalang-Batang-Semarang roadmap
Source: Company
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The government’s capital injection to accelerate growth
Waskita is privileged to be the first listed state-owned company that will receive a capital injection from the government in 2015. As one of the state-contractors, Waskita is an agent of development, especially in regard to toll road development in Indonesia. The government’s capital injection of Rp3.5tn will translate into a potential rights issue of up to Rp5.3tn given that the government’s stake in Waskita will be undiluted. As a result, Waskita’s equity will increase significantly from only Rp2.8tn in December 2014 to Rp8.8tn by the end of 2015 – making it the largest among the state-contractors.
New Waskita: Large equity base is the key to getting big projects The government’s plan to inject Rp3.5tn of capital into Waskita will be done through a rights issue raising up to Rp5.3tn given that the government’s ownership will be undiluted. Post- rights issue, Waskita will receive a large boost both in terms of its market cap and equity size – making Waskita the largest state-contractor in Indonesia. By the end of 2015, in our estimation, Waskita will have total equity of Rp8.8tn, overpass WIKA – which has been the market leader in the past. Furthermore, the government’s equity participation also demonstrates the government’s strong willingness to develop infrastructure in Indonesia as soon as possible. The proceeds of the rights issue will mostly be used to finance Waskita’s toll road projects and for working capital.
Exhibit 38. Rights issue terms
Type of issuance Pre-emptive right issue Number of rights offered 3,653,498,200 new shares Nominal value Rp100 per share Right – Exercise price Rp1,450 per share Pre-emptive right amount Rp5,297,572,390,000 Conversion ratio (old : new) 100,000 : 36,852 Ownership dilution 26.9% Total shares post-right 13,567,473,560 shares
Source: Company
Exhibit 39. Waskita TERP calculation
Price Shares Market cap Rp bn Rp bn Current 1,690 9.9 16,767 Rights 1,450 3.6 5,301 TERP 1,625 13.6 22,068 Discount to market, % 14.2 Discount to TERP, % 10.8 Dilution, % 3.8
Source: Company, Bloomberg as of 8 June 2015
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Exhibit 40. Post-rights issue, Waskita will be the largest state-contractor in Indonesia
Des-14 Des-15
10,000 9,000 8,000 7,000 6,000 5,000 4,000 Total equity, Rpbn 3,000 2,000 1,000 - Waskita WIKA PTPP ADHI
Source: Companies, Danareksa Sekuritas
Post-rights issue, Waskita will have a much healthier balance sheet. In our view, this will benefit the company in two ways: 1) Waskita can target a larger size of new contracts given the company’s balance sheet capacity and 2) Waskita will be less dependent on the financing gap for its working capital. Having a large equity base - especially for the state-contractors - is a key factor behind being able to generate bigger order books in the future given the ability to leverage. This will help Waskita to maintain its growth pace and enhance its profit margins, even during the high interest rates environment.
As of December 2014, Waskita had total interest-bearing liabilities of Rp3.2tn. After its IPO in 2012, Waskita continued to gear up following its growing order book size. Prior to 2012, Waskita’s net gearing was close to its debt covenant at more than 3.0x. During the peak cycle in 2014, Waskita’s net gearing reached 0.8x. With the rights issue proceeds, Waskita will be in a net cash position by the end of 2015. Nonetheless, we expect the company to gear up in the coming years given its rapid development and planned investments in toll road projects.
Potential order book from the inclusion of new toll road projects Waskita had carry-over contracts of Rp20.3tn starting in 2015. Initially, the company set the new contracts target in 2015 at Rp20.8tn, thereby bringing the potential total order book up to Rp41.1tn in FY15F. Currently, Waskita has a total of Rp6.3tn of order books from its three ongoing toll road projects in Pejagan-Pemalang, Becakayu and Depok Antasari, comprising around 31% of the company’s carry-over contracts in 2015.
Exhibit 41. Waskita contracts in toll road projects
Project name Segment Type Awarding Value, Rp bn
Bekasi-Cawang-Kp. Melayu Section 1 Precast – Toll road 4Q14 3,046 Bekasi-Cawang-Kp. Melayu Section 1 Civil – Toll road 4Q14 1,168 Pejagan-Pemalang Section 1 Civil – Toll road 3Q14 1,123 Pejagan-Pemalang Section 2 Civil – Toll road 3Q14 556 Depok-Antasari Package 1 (JO) Civil – Toll road 3Q14 416 TOTAL 6,309
Source: Company
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In the near-term, around Rp1.0tn will be awarded from the Medan-Kualanamu-Tebing Tinggi toll road project for which construction will begin and Waskita has minority ownership. Moreover, with a more positive tone for the Soker and Legundi-Bunder toll road projects, we estimate that total construction works of around Rp5.0tn will solely be done by Waskita given that Waskita is the only contractor in the ownership structure. These projects should be awarded in 2H15F. Nonetheless, the inclusion of other toll road projects is still possible provided that Waskita can hasten the acquisition process.
Exhibit 42. Waskita’s potential new contracts from new toll road projects
Section Owner Length Investment km Rp bn
Medan-Kualanamu-Tebing Tinggi Jasa Marga Kuala Namu Tol 61.7 4,072 Legundi-Bunder Waskita Bumi Wira 29.2 4,292 Solo-Ngawi Solo Ngawi Jaya 69.2 5,138 Ngawi-Kertosono Ngawi Kertosono Jaya 49.5 3,832 Cinere-Serpong Cinere Serpong Jaya 10.1 2,219 Pemalang-Batang Pemalang Batang Toll Road 39.2 4,077 Batang-Semarang Marga Setiapuritama 75.0 7,214 TOTAL 333.9 30,844
Source: Company, BPJT
As such, we estimate that Waskita’s new contracts target will reach Rp21.8tn in FY15F, or slightly higher than the company’s initial target of Rp20.8tn, due to the inclusion of the new toll road projects. In our assumption, we only add the Soker and Legundi-Bunder toll roads to the company’s order book given the positive progress made so far. As a result, Waskita has a total order book of Rp42.1tn in FY15F with a project profile up to the next three years, providing a robust growth outlook.
Exhibit 43. Waskita’s order book
Rp tn Order book
60 50.4 50 47.2 42.1 40 33.1 30 22.1 18.8 20 14.5 11.2 10
0 2010 2011 2012 2013 2014 2015F 2016F 2017F
Source: Company, Danareksa Sekuritas
Growth acceleration is imminent Thanks to its toll road investments, Waskita now has two substantial high margin projects in its order book: 1) the Rp1.7tn civil construction works in the Pejagan-Pemalang toll road and 2) the Rp1.2tn civil construction works and Rp3.0tn in the precast procurement in the Becakayu toll road. The gross margins offered by these toll road projects are better than the normal ones both for the civil construction works as well as the precast used. With a project maturity profile until 2017, Waskita will be able to experience better profitability
28 11 June 2015 Waskita Karya
during the construction period for the next three years at least. These high-margin toll projects will contribute up to 11-13% of the company’s total revenues in FY15F/16F before falling to around 4% in FY17F as the project completion date nears.
Exhibit 44. The contribution from Waskita’s high-margin toll road projects
Normal-margin project High-margin toll project Normal-margin project High-margin toll project 50,000 25,000 45,000 959 959 40,000 3,055 20,000 35,000 4,857 2,095 30,000 15,000 1,802 25,000 5,893 1,036 20,000 10,000 Orderbook, Rp bn
15,000 Revenues, Rpbn 10,000 5,000 5,000 - - 2014 2015F 2016F 2017F 2014 2015F 2016F 2017F
Source: Company, Danareksa Sekuritas
We estimate that Waskita’s new contracts will reach Rp21.8tn/22.3tn/24.8tn in FY15F/16F/17F. In total, the order book will touch Rp50tn in FY17F, reflecting a healthy 15% CAGR from 2014. Consequently, revenues will also follow with growth estimates of 29% CAGR in FY14-17F. Given the high margins of some special projects, plus lower financing needs thanks to the rights issue proceeds, net profits will grow at a brisker pace. In our estimates, Waskita’s net profits can reach Rp762bn/1,129bn/1,204bn in FY15F/16F/17F, reflecting 34% CAGR in FY14- 17F – a continuity of company’s high growth performance. We believe that potential upside in our earnings estimates is still possible given the potential inclusion of another toll road projects which we haven’t included yet.
Exhibit 45. Waskita’s growth acceleration
Revenues, Rp bn Net profit, Rp bn
25,000 +28% CAGR +8% CAGR +29% CAGR 1,400 +68% CAGR +41% CAGR +34% CAGR
1,200 20,000 1,000
15,000 800
600 10,000 400
5,000 200
- - 2008 2009 2010 2011 2012 2013 2014 2015F 2016F 2017F 2008 2009 2010 2011 2012 2013 2014 2015F 2016F 2017F Source: Company, Danareksa Sekuritas
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Indonesia’s toll road industry
The new land bill as the game changer The change from the obsolete regulation of Agraria Law (land bill) 1960 to the latest land bill in 2012 (Law No. 2/2012) is believed to be the game changer in overcoming obstacles to land acquisition in Indonesia. In the past, land acquisition has been a formidable challenge to infrastructure development due to a lack of clarity on the timeline of the land acquisition process as well as the price settlement.
In January 2012, the government enacted Law No. 2/2012 on the Land Acquisition for the Development of Public Interest (the ‘new land bill’). The new land bill provides more certainty on the land acquisition process regarding the time frame and the costs. One of the key improvements introduced under the new land bill is that once the payment for land compensation has been made (which includes keeping the money with the court – in case the land owner refuses to accept it), the title ownership over the land is automatically revoked by the law. By having such a provision, land owners cannot block construction works, meaning greater clarity over the construction timeline. Under the previous law, land title could not be revoked unless the President decided to revoke the land title. In particular, the new land bill will focus on setting deadlines in the land compensation process (maximum 250 days to negotiate the land compensation in the court). The new land bill has been fully implemented since January 2015.
Exhibit 46. New timeline for land acquisition in the new land bill
Source: Jasa Marga The Government also offers full support For the land acquisition, the government also provides a revolving fund facility, called BLU (‘Bantuan Langsung Umum’), which is similar to the bridging facility from the government to finance the payment for land acquired from land owners. Once the land has been fully acquired and handed over to the toll road company, the toll road company shall repay the BLU funds to the government. The BLU funds are given to minimize the risk of the toll road company spending its own funds whilst there is no certainty when the land acquisition can be completed.
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In addition, the concession agreement also provides estimates of land acquisition costs to be borne by the toll road company. If, somehow, the actual land acquisition costs incurred are higher than the estimated amount, the toll road company shall only be liable to finance the land acquisition cost up to an amount equal to 110% of the estimated land acquisition cost or 100% of the estimated land acquisition cost plus 2% of the total investment cost, whichever is higher. Any amount exceeding the capped amount will be the government’s responsibility.
For certain projects, which are considered not financially feasible, the government may provide government support in the form of, among others, land acquisition to be financed by the government or part of the construction to be undertaken and financed by the government, usually called viability gap funding (VGF). In the case that the government acquires the land before the tender, the land acquisition cost will not form part of the investment cost. However, if the project is financially feasible, the wining tender may be required to reimburse the land acquisition cost to the government.
The main problem encountered in infrastructure projects in Indonesia lies in land acquisition that takes a long time. To overcome this problem, the government adopted a new strategy, namely to acquire the land bank in advance prior to the tender process. This step refers to Presidential Decree No. 38/2015 on Public Private Partnerships in the Provision of Infrastructure. Hence, the government will secure the land bank needed using the state budget up to 75% before the tender process is started. This was how the land bank was acquired for the Soreang-Pasir Koja toll road. With this new strategy in place, investors will find it easier to begin toll road construction; hence there shouldn’t be any stalled toll road projects in the future. Through this scheme, it is expected that there will not be any investors who only join the tender process to get the concession rights, whilst, at the same time, they are reluctant to undertake construction because of land clearance issues and only take profits from selling the concession rights onto other investors.
The Trans Java and Trans Sumatera toll road network Indonesia’s toll road history began in 1987 with the first toll road operated being the 59km Jakarta-Bogor-Ciawi (Jagorawi) toll road. At that time, the construction was carried out by the government with funds from the government budget and foreign loans through Jasa Marga. In the period of 1995-1997, the government made efforts to accelerate toll road development with tenders of 762km. However, the development stalled due to the financial crisis in 1997/98. After the crisis, toll road development in Indonesia was stagnant, as evidenced in the establishment of only 13km of new toll roads in the period of 1997-2001. In 2001-2004, a total of four new toll roads were operated with a total length of 42km. In 2004, under Law No. 38/2004, the Indonesian Toll Road Authority (BPJT) became the regulator for toll roads in Indonesia, which was previously held by Jasa Marga. Nonetheless, the toll road construction re-entered the acceleration phase starting in 2005. As of 2014, a total of 820km of toll roads has been build and were operated in Indonesia, with Jasa Marga owning two- thirds of the sections.
Yet, in the past ten years, national road development has been very slow with CAGR of only 4%. By contrast, car population has grown by a faster CAGR 11% in the past ten years. As a result, the ratio of cars per km shot up from 19 cars per km to 38 cars per km during 2003- 2013. This suggests that the development of roads should be accelerated to prevent bottlenecks from occurring.
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Exhibit 47. Total road length in Indonesia and vehicles penetration
Road length, '000 km Vehicles (4W)/km (RHS) 600 45 40 500 35 400 30 25 300 20 200 15 10 100 5 0 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Source: BPS
In its blueprint, the government has made the Trans Java toll road network and the Trans Sumatera toll road network the main backbone to support land logistics. The toll road network blueprint will integrate the west and east coast of Java (Trans Java) and also provide a connection from the northern tip of Sumatera to its southern end (Trans Sumatera). As for Trans Java, the toll road network is expected to ease the burden on Java’s northern coastal road (Pantura), which had been the island’s transportation backbone, and which allowed the distribution of goods equivalent to almost 50% of the nation’s economy.
The Java toll road network still seems to be the government’s main priority as Java has the highest density of average 85 cars per km given that it is the most populated part of Indonesia. Currently, almost all the toll roads under operation are located in Java with the upcoming toll roads under development also to be located in Java. Thus, the prioritizing of toll road development in Java has a strong economic rationale.
Exhibit 48. Highest car population density is still in Java
Source: BPS
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Meanwhile, Sumatera is a resource-rich island and Indonesia’s second-largest island in terms of geographic size. The Trans Sumatera toll road network will span 2,700km from Lampung in the southern to Aceh in the northern area with total investment estimated to reach Rp300tn. Various factors have been behind the long delays in project execution. Most importantly is the lack of financial resources and land acquisition problems. Due to the long- term commitment and costly investment in combination with the low IRR, the private sector is not that interested in this project unlike the Trans Java toll road network. Therefore, the government has decided to finance the project through the combined financial power of the central government, regional governments, and state-owned enterprises. Hutama Karya, as an SOE 100% owned by the government, has been assigned to construct the project with support from a government capital injection. Under the new government, the groundbreaking ceremony for the Trans Sumatera toll road was held in April 2015, with construction expected to take around ten years.
Exhibit 49. Toll roads planned for tender
Toll road section Length Land acquisition Investment Status km Rp bn Rp bn
Cileunyi-Sumedang-Dawuan 58.5 1,295 12,331 Tender in preparation Manado-Bitung 38.7 365 4,163 Tender in preparation Pandaan-Malang 37.6 294 3,990 Tender in preparation Balikpapan-Samarinda 99.0 1,267 11,400 Tender in preparation Serpong-Balaraja 30.0 - 5,177 Tender in progress Pasir Koja-Soreang 10.6 - 1,886 Tender in progress
Source: BPJT
Toll road concession rights assets Toll road concession rights are granted by the government in the form of toll road concessions. Toll road assets consist of toll roads and bridges, toll gates, and supporting buildings and toll facilities and equipment. They are recorded as toll concession rights assets and are stated at fair value at the date of revaluation less any subsequent accumulated depreciation.
Costs incurred to acquire toll road concession rights assets are depreciated when the assets have been completed and put into operation and/or based on the Ministerial decree regarding toll road operation. Depreciation of assets is carried out by using the straight-line method during the period of concession rights, which is commonly started after operation.
Concessions granted to the company can be transferred with the approval of the government. The concession right assets will be transferred to the government at the end of the concession period and at such time, all accounts related to the concession right assets will be derecognized. During the concession period, the assets may be derecognized from the statement if the toll road is transferred to another party or the government has changed the status of the toll road to non-toll road or if there is no economic benefit expected from usage of the toll road.
Toll tariff adjustments The initial toll tariff shall be set in accordance with the business plan as agreed by the toll road company and the government. In setting the initial toll tariff, the government will take into account the ability of motorists to pay, the benefit of vehicle operation by using the toll road, and the feasibility of the investment. The toll tariff will be evaluated and adjusted every two years in accordance with the local inflation rate, provided that the toll road company has complied with the minimum services standard.
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Exhibit 50. Profit and loss (IDR bn)
2013 2014 2015F 2016F 2017F
Revenues 9,687 10,287 14,268 18,568 21,874 COGS 8,776 9,178 12,619 16,429 19,466 Gross profit 911 1,109 1,650 2,138 2,408 Income from JO 102 197 206 214 229 Gross profit incl. JO 1,012 1,306 1,856 2,352 2,637 Operating expenses (340) (431) (541) (659) (726) Operating profit 672 875 1,314 1,693 1,911 Net interest (70) (140) (199) (105) (165) Other income (expenses) 9 20 - - - Pre-tax income 611 756 1,115 1,588 1,745 Income tax (243) (254) (353) (459) (541) Net profit 368 502 762 1,129 1,204 Core profit 363 488 762 1,129 1,204
Source: Company, Danareksa Sekuritas
Exhibit 51. Balance sheet (IDR bn)
2013 2014 2015F 2016F 2017F
Cash & equivalent 1,120 1,675 3,222 1,566 1,157 Trade receivables 1,710 2,307 3,766 5,417 5,774 Project receivables 3,944 4,954 7,256 9,939 11,090 Inventories 292 604 1,092 1,193 1,414 Other current assets 715 984 1,112 1,440 1,692 Total Current Assets 7,781 10,524 16,449 19,556 21,127
LT investments 570 1,363 2,181 2,995 3,824 Fixed assets 415 622 926 1,203 1,454 Other assets 21 33 33 33 33 Total Non-current Assets 1,007 2,018 3,140 4,232 5,311 TOTAL ASSETS 8,788 12,542 19,589 23,788 26,438
ST loans 875 1,917 400 400 1,500 Trade payables 2,291 2,572 3,439 4,477 5,305 Current portion of LT loans - - - 1,174 - Other current liabilities 2,261 3,239 4,777 6,662 7,344 Total Current Liabilities 5,427 7,728 8,616 12,714 14,149
LT loans 748 1,246 1,174 - - Other liabilities 230 719 988 1,285 1,522 Total Non-current Liabilities 978 1,965 2,161 1,285 1,522 Capital stock 1,794 1,854 7,155 7,155 7,155 Retained earnings 563 954 1,616 2,592 3,571 Other equity 26 41 41 41 41 Total Equity 2,383 2,849 8,812 9,789 10,767
TOTAL LIABILITIES AND EQUITY 8,788 12,542 19,589 23,788 26,438
Source: Company, Danareksa Sekuritas
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Exhibit 52. Cash flow (IDR bn)
2013 2014 2015F 2016F 2017F
Pretax profit 611 756 1,115 1,588 1,745 Tax (462) (305) (528) (648) (685) Depreciation 53 86 125 192 264 Changes in W/C (291) (694) (2,029) (1,716) (382) Cash Flow from Operation (89) (157) (1,317) (583) 943
Capex (228) (292) (430) (470) (514) Investments (253) (968) (643) (814) (829) Others (206) 468 325 362 291 Cash Flow from Investing (687) (792) (748) (922) (1,051)
ST loans (297) 1,042 (1,517) - 1,100 Current portion of LT loans - - - 1,174 (1,174) LT loans 1 498 (72) (1,174) - Equity 29 74 5,301 - - Dividend (20) (110) (100) (152) (226) Cash Flow from Financing (288) 1,504 3,612 (151) (300)
Change in Cash (1,064) 555 1,547 (1,656) (409)
Source: Company, Danareksa Sekuritas
Exhibit 53. Key Ratios
2013 2014 2015F 2016F 2017F Profitability, % Gross margin - excl. JO 9.4 10.8 11.6 11.5 11.0 Gross margin - incl. JO 10.5 12.7 13.0 12.7 12.1 Operating margin 6.9 8.5 9.2 9.1 8.7 EBITDA margin 7.5 9.3 10.1 10.2 9.9 Net margin 3.8 4.9 5.3 6.1 5.5 Core margin 3.7 4.7 5.3 6.1 5.5 ROAE 16.8 19.2 13.1 12.1 11.7 ROAA 4.3 4.7 4.7 5.2 4.8
Leverage Debt to equity, % 68.1 111.0 17.9 16.1 13.9 Net debt to equity, % 21.1 52.2 Net cash 0.1 3.2 Interest coverage, x 6.9 4.8 4.3 9.5 9.3
Turnover, days Trade receivables 64 81 95 105 95 Inventories 12 24 31 26 26 Trade payables 94 101 98 98 98
Growth, % Revenues 10.0 6.2 38.7 30.1 17.8 Operating profit 24.5 30.2 50.1 28.8 12.9 EBITDA 26.3 32.6 49.8 31.0 15.3 Net profit 44.9 36.3 51.9 48.2 6.7 Core profit 63.2 34.5 56.2 48.2 6.7
Source: Company, Danareksa Sekuritas
35
Equity Research Thursday, June 11, 2015
MARKET NEWS
Ministries Need More Funds in 2016 for Infra Projects (TJP) Public Works and Transportation Ministries called for greater funding during a hearing with the House of Rep. For the proposed 2016 state budget, Public Works Ministry recommend a total budget of Rp126tn, up from the previous proposal of Rp102.5tn to complete several multi-year projects. The Ministry is planning to begin the construction of eight dams next year. As of June 9, the ministry had spent almost 10% of the allocated 2015 state budget.
Comment: The 6% increase in Public Works Ministry budget for next year mainly focuses to improve the realization rate during the period. Next year budget proposal of Rp126tn still considered a significant increase of 33%y-y, assuming this year budget realization only could reach 80% (Rp95tn, +33%y-y). The final decision on the budget proposal will be made in August 16, 2015. (Joko)
Strengthening Capital: BTN Aims Rp9 Trillion Rights Issue (BI) BBTN is in the discussion process on a rights issue plan worth Rp9 trillion to strengthen its capital as well as to raise funds in order to support the one million homes program. The Company said the option was considered due to the slower growth in retained earnings compared to the growth in loans. Right issue option was also taken into consideration considered its capital position as the company aims to maintain Capital Adequacy Ratio (CAR) within the range of 15-16%. Execution is expected to be done in early 2016. The company also offers bonds worth Rp3 trillion, which is divided into four series with a tenor of 3-10 years and a coupon rate of 9.2-9.9%.
Comment: CAR stood at 15.0% as of March 2015. In our model with 16.8% loans growth in 2015F, CAR will go down to 13.8% assuming the 20% payout ratio. So it is reasonable for BBTN to have a right issue plan as one of its option to own more sufficient capital to support its loans expansion going forward. We maintain BUY call on BBTN with an unchanged target price of IDR1,400 implying PBV 1.1-1.0x for 2015-16F. (Eka)
4W: Sluggish Sales, Manufacturers Reduce Stock (BI) Sluggish car sales push agents to reduce stocks by reducing deliveries to dealers and trying to boost retail sales. Stocks available during five months period of 2015 reached 10,678 units, lower than last year’s number of 34,184. Wholesale and retail sales have been down by approximately 16%, while production fell 15% this year. Gaikindo is pessimistic on this year sales, and believes it will not be higher than 1-1.1 million units.
Comment: Given the current weak demand situation, auto company appears to adopt survival strategy, including to put stringent control on their inventory level in dealership. High inventory level will undoubtedly intensify the competitive landscape, which will further erode margin. Recently, Astra also made changes on its distributor structure to be closer to the demand base (sub dealership).(Helmy)
Ministry of Industry Pushing For 100% Local Content Auto (ID) In order to add value to national economy, Ministry of Industry will focus on pushing forward the idea of using 100% local component for domestic-made automotives, while plan for national car is yet to be developped. According to Saleh Husin, Industry Minister, the government will push the upstream part of auto industry, such as steel, to achieve 100% local component cars. The minister cited Krakatau Steel (KRAS), which is cooperating with 2 Japanese companies to built auto and construction related industrial steel in Cilegon, Banten, as an example of the upstream progress.
Comment: We believe the LCGC will eventually be transformed into the national car platform, given its relatively high local content currently. During the launch of the LCGC, regulation requires for minimal 85% local content. Astra’s LCGC, Toyota Agya and Daihatsu Ayla, is targeting to raise its local content to 88% in the near term. The biggest challenge to hit 100% local content would be the availability of auto-grade steel, which will require more investment in the upstream level. (Helmy)
Danareksa Sekuritas – Equity Research
Equity Research Thursday, June 11, 2015
Freeport to get early extension (TJP) Freeport Indonesia has agreed to change company’s contract of work (CoW) into special mining license (IUPK) that it’ll enable it to renew its concession right earlier than expected. Freeport current CoW will expire in 2021 with extension request can only be made two years prior expiry, while with the new regulation applied, this contract will no longer valid and Freeport can operate longer in Indonesia as IUPK has a maximum term of 20 years and can be extended twice for subsequent terms of 10 years each. IUPK put government on stronger position with more authority and Freeport now will be subject to new taxes and royalties as well as needed to divest part of its foreign ownership to Indonesian investors. There’re still no exact details changing contract into license’s timeline, but it would concluded before CoW expiry.
ISAT Plans to Issue Rp2tn Bonds (ID) In 4Q15, Indosat (ISAT) is planning to issue phase III of its shelf-registered bonds, amounting to Rp2tn. The bonds, amounted to a total of Rp10tn, has been issued Rp2.5tn in its phase I in December 2014, and issued Rp3.1tn in its phase II in May 2015.
PTBA Officially Opens New Port (ID) Bukit Asam (PTBA) has officially commenced operation its third coal loading dock in Tarahan Port, Bandar Lampung. With this new dock, the capacity of the port will become 25mn tons coal p.a.
Waskita Aims for More Toll Road Projects to Meet Target (TJP) WSKT hopes to secure at least two more toll road projects this year with combined investment of Rp7tn. The additional toll road projects will help the company meet its target of working on toll road projects with a combined investment of Rp40tn in 2015. The company was looking to bid for up to six more toll road project tenders before the end of this year. The construction firm will finance its toll road investment project from its coming right issue, which is expected to be carried out later this month.
Danareksa Sekuritas – Equity Research Equity Price Mkt Cap Net profit, Rp bn EPS (Rp) EPS Growth PER (x) EV / EBITDA (x) PBV (x) Net Gearing ROE Rating Price (Rp) Valuation Target Rp Bn 2015 2016 2015 2016 2015 2016 2015 2016 2015 2016 2015 2016 2015 2015
Danareksa Universe 2,867,716 197,711 225,489 328.3 374.4 11% 14% 14.5 12.7 12.6 11.4 2.6 2.3 19.0 Auto 290,131 24,660 29,165 451.7 534.3 15% 18% 11.8 9.9 9.5 8.2 2.1 1.8 18.6 Astra International HOLD 6,850 8,300 277,312 23,976 28,096 592 694 16% 17% 11.6 9.9 9.7 8.3 2.1 1.8 33.5 19.1 Gajah Tunggal BUY 1,015 1,500 3,537 266 633 76 182 -1% 139% 13.4 5.6 4.6 4.4 0.6 0.5 80.8 4.4 Selamat Sempurna BUY 4,610 5,300 6,637 419 437 291 303 14% 4% 15.9 15.2 9.2 8.6 4.7 4.0 net cash 32.3 Banks 957,609 84,332 96,420 782.9 895.1 13% 14% 11.4 9.9 2.2 1.9 21.4 BCA HOLD 13,325 14,050 328,528 19,127 21,921 767 879 15% 15% 17.4 15.2 NA NA 3.5 2.9 NA 22.4 BNI BUY 5,750 7,450 107,230 12,142 13,914 651 746 13% 15% 8.8 7.7 NA NA 1.6 1.4 NA 19.1 BRI BUY 10,400 13,800 256,559 27,391 31,497 1,110 1,277 13% 15% 9.4 8.1 NA NA 2.1 1.8 NA 25.2 Bank Tabungan Negara BUY 1,120 1,400 11,836 1,357 1,609 129 153 22% 19% 8.7 7.3 NA NA 0.9 0.8 NA 10.6 Bank Mandiri BUY 9,875 13,600 230,417 22,087 24,946 947 1,069 11% 13% 10.4 9.2 NA NA 1.9 1.6 NA 19.8 Bank Tabungan Pensiunan BUY 3,945 5,450 23,040 2,228 2,533 381 434 19% 14% 10.4 9.1 NA NA 1.6 1.4 NA 17.2 Cement 164,067 12,525 15,375 725 890 7% 23% 13.1 10.7 7.9 7.0 2.5 2.2 20.0 Holcim HOLD 1,515 2,300 11,609 923 1,213 120 158 12% 31% 12.6 9.6 6.7 5.2 1.1 1.0 30.0 9.1 Indocement BUY 20,750 28,300 76,386 5,741 6,595 1,559 1,792 8% 15% 13.3 11.6 7.7 6.5 2.7 2.4 net cash 21.2 Semen Indonesia BUY 12,825 18,800 76,072 5,861 7,567 988 1,276 5% 29% 13.0 10.1 8.4 7.9 2.8 2.4 12.3 23.2 Construction 105,847 4,577 5,552 120 145 24% 21% 23.1 19.1 11.3 9.7 3.6 3.1 16.7 Jasa Marga BUY 6,150 8,200 41,820 1,600 1,877 422 547 25% 30% 14.6 11.2 14.3 12.8 3.3 3.0 116.4 13.4 Wijaya Karya BUY 2,760 4,000 16,972 843 1,004 137 164 37% 19% 20.1 16.9 8.3 7.0 2.9 2.4 8.9 15.4 Pembangunan Perumahan BUY 3,675 4,600 17,796 694 856 143 177 30% 23% 25.7 20.8 10.0 8.3 6.0 4.8 18.0 25.8 Adhi Karya BUY 2,165 3,700 3,900 399 531 221 295 23% 33% 9.8 7.3 5.4 4.7 1.9 1.5 66.5 20.8 Waskita Karya BUY 1,670 2,150 16,556 646 792 66 81 28% 23% 25.3 20.7 13.1 10.6 5.0 4.2 39.2 20.9 Wika Beton HOLD 1,010 1,350 8,803 396 491 45 56 32% 24% 22.3 17.9 11.7 9.4 3.5 3.0 net cash 17.1 Consumer 461,755 13,686 15,530 498 565 9% 13% 33.7 29.7 20.2 18.2 8.9 8.0 27.8 Indofood CBP HOLD 13,175 13,800 76,823 3,033 3,308 520 567 16% 9% 25.3 23.2 17.5 16.5 4.9 4.4 net cash 20.3 Indofood BUY 6,775 8,050 59,487 3,811 4,287 434 488 -2% 12% 15.6 13.9 7.4 6.8 2.1 1.9 19.2 14.1 Unilever SELL 41,350 30,000 315,501 6,365 7,332 834 961 11% 15% 49.6 43.0 34.6 30.3 58.5 52.4 net cash 129.7 Nippon Indosari Corpindo HOLD 1,200 1,200 6,074 266 377 53 75 41% 42% 22.8 16.1 13.1 9.2 5.2 4.1 63.0 25.0 Mandom BUY 19,250 19,300 3,871 210 226 1,045 1,126 8% 8% 18.4 17.1 9.9 9.2 2.7 2.4 2.6 15.3 Heavy Equipment 80,710 5,764 6,341 1,261 1,387 4% 10% 14.0 12.7 6.1 5.2 1.9 1.7 14.1 Hexindo Adiperkasa HOLD 2,830 3,650 2,377 220 260 262 309 13% 18% 10.8 9.2 5.1 4.0 0.8 0.8 net cash 8.0 United Tractors HOLD 21,000 22,200 78,333 5,544 6,081 1,486 1,630 3% 10% 14.1 12.9 6.1 5.3 2.0 1.8 net cash 14.5 Healthcare 100,724 2,633 3,039 49 57 11% 15% 38.2 33.1 22.9 19.1 7.0 6.2 19.3 Kalbe Farma HOLD 1,680 1,900 78,750 2,273 2,593 48 55 9% 15% 35.0 30.5 22.9 19.6 7.4 6.5 net cash 22.7 Kimia Farma BUY 985 1,500 5,471 258 313 47 56 12% 19% 21.0 17.6 14.3 11.4 2.7 2.4 2.3 13.5 Siloam Hospital BUY 14,275 15,750 16,503 102 133 89 115 64% 30% 161.1 124.2 28.2 21.0 9.4 8.7 64.2 6.0 Mining 106,232 8,963 10,056 138 155 5% 12% 11.9 10.6 5.4 4.8 1.1 1.0 9.4 Adaro Energy BUY 830 1,150 26,548 2,095 2,202 66 69 2% 5% 12.7 12.1 4.5 4.0 0.7 0.8 33.0 6.2 Timah BUY 775 1,400 5,772 651 765 87 103 40% 18% 8.9 7.5 4.4 3.9 1.1 1.0 10.2 12.4 Vale Indonesia BUY 2,825 4,200 28,070 2,375 2,566 239 258 17% 8% 11.8 10.9 5.4 4.6 1.3 1.2 2.6 11.0 Aneka Tambang HOLD 735 1,100 7,011 194 400 20 42 -148% 106% 36.1 17.5 13.9 10.4 0.6 0.5 62.8 1.6 Bukit Asam BUY 9,050 13,500 20,852 1,746 1,939 803 892 -13% 11% 11.3 10.1 8.1 7.1 2.3 2.1 net cash 19.7 Indo Tambangraya Megah HOLD 13,100 16,000 14,802 1,782 1,982 1,577 1,755 -15% 11% 8.3 7.5 3.7 3.4 1.4 1.4 net cash 18.0 Harum Energy HOLD 1,175 1,750 3,177 119 202 44 75 -53% 69% 26.7 15.8 2.1 1.6 0.8 0.9 net cash 3.1 Plantation 62,405 5,510 5,938 211 227 11% 8% 11.3 10.5 6.1 5.5 1.6 1.5 14.9 Astra Agro Lestari BUY 23,925 27,100 37,676 2,770 2,832 1,759 1,798 4% 2% 13.6 13.3 8.1 7.7 3.2 2.9 net cash 24.5 Sampoerna Agro BUY 1,795 2,600 3,393 464 550 245 291 18% 19% 7.3 6.2 4.8 4.1 1.0 0.9 31.8 14.5 PP London Sumatra HOLD 1,690 2,090 11,531 1,055 1,133 155 166 8% 7% 10.9 10.2 5.6 4.8 1.5 1.3 net cash 13.9 Salim Ivomas Pratama BUY 620 850 9,806 1,221 1,423 77 90 33% 17% 8.0 6.9 4.2 3.7 0.6 0.6 37.6 8.2 Property 79,270 5,943 6,634 80 89 -25% 12% 13.3 11.9 10.1 8.8 1.8 1.6 14.4 Alam Sutera BUY 535 700 10,512 1,254 1,516 64 77 15% 21% 8.4 6.9 8.2 6.9 1.5 1.2 75.3 18.9 Bumi Serpong Damai BUY 1,770 2,100 34,067 2,369 2,617 135 150 -36% 10% 13.1 11.8 11.4 10.1 2.3 2.0 net cash 16.6 Metropolitan Land BUY 414 620 3,138 290 322 38 43 14% 11% 10.8 9.7 7.3 6.8 1.4 1.3 27.7 14.2 Surya Semesta Internusa HOLD 1,090 1,040 5,129 464 415 99 88 32% -11% 11.0 12.4 5.1 5.2 1.7 1.6 net cash 16.9 Lippo Karawaci BUY 1,145 1,200 26,424 1,565 1,763 72 82 -38% 13% 15.8 14.0 12.1 10.3 1.7 1.5 29.1 10.1 Telco & Infrastructure 433,045 19,454 22,656 142 166 25% 16% 22.3 19.1 6.4 5.9 3.6 3.3 17.1 XL Axiata BUY 3,800 4,710 32,457 356 680 42 80 -140% 91% 91.0 47.7 6.1 5.5 2.3 2.2 120.7 2.5 Indosat BUY 3,680 4,200 19,997 312 588 57 108 -152% 89% 64.1 34.0 3.6 3.3 1.3 1.2 132.4 2.0 Telkom HOLD 2,860 3,050 288,288 15,554 16,458 158 168 6% 6% 18.1 17.1 5.8 5.4 3.9 3.7 net cash 22.1 Sarana Menara Nusantara BUY 4,000 4,525 40,812 1,702 2,121 167 208 35% 25% 24.0 19.2 12.0 10.2 6.3 5.0 107.9 29.8 Tower Bersama HOLD 8,850 8,725 42,449 1,528 2,387 300 429 9% 43% 29.5 20.6 16.0 12.8 3.6 3.0 129.0 19.3 MNC Sky Vision HOLD 1,280 1,410 9,042 2 423 0 60 -101% 19638% 4,218.7 21.4 8.8 7.4 5.5 4.4 150.1 0.1 Tranportation 20,392 1,253 1,554 501 621 62% 24% 16.3 13.1 9.1 7.5 4.6 3.6 32.3 Blue Bird BUY 8,150 12,200 20,392 1,253 1,554 501 621 62% 24% 16.3 13.1 9.1 7.5 4.6 3.6 47.8 32.3 Utility 101,814 11,088 10,313 457 425 3% -7% 9.2 9.9 6.2 6.7 2.5 2.3 28.7 PGN BUY 4,200 6,650 101,814 11,088 10,313 457 425 3% -7% 9.2 9.9 6.2 6.7 2.5 2.3 net cash 28.7 Retail 24,831 1,210 1,509 47 58 15% 25% 20.5 16.5 9.9 8.4 2.7 2.4 14.0 Mitra Adi Perkasa BUY 5,500 6,525 9,130 352 543 212 327 112% 54% 25.9 16.8 8.5 7.0 3.2 2.7 84.7 13.0 Ramayana SELL 690 660 4,896 243 255 34 36 -31% 5% 20.1 19.2 9.7 8.9 1.4 1.4 net cash 7.2 Ace Hardware BUY 630 780 10,805 615 711 36 41 17% 14% 17.5 15.4 12.4 10.5 3.8 3.2 net cash 23.8
Equity Research Thursday, June 11, 2015
COVERAGE PERFORMANCE
LEADERS
Price as on Code 10-Jun-2015 09-Jun-2015 Chg, % w-w, % m-m, % YTD, % Rating MNC Sky Vision MSKY 1,280 1,145 11.8 (2.7) (17.7) (20.0) HOLD Bank Tabungan Pensiunan BTPN 3,945 3,600 9.6 2.3 (1.4) (0.1) BUY Unilever UNVR 41,350 39,700 4.2 (5.2) (5.3) 28.0 SELL Astra Agro Lestari AALI 23,925 23,200 3.1 (6.7) 7.6 (1.3) BUY Bank Tabungan Negara BBTN 1,120 1,090 2.8 (1.8) 2.8 (7.1) BUY Indofood INDF 6,775 6,600 2.7 (2.9) 1.9 0.4 BUY United Tractors UNTR 21,000 20,500 2.4 (2.6) (10.8) 21.0 HOLD Siloam Hospital SILO 14,275 13,975 2.1 2.1 2.7 4.2 BUY Indofood CBP ICBP 13,175 12,900 2.1 (4.2) (4.0) 0.6 HOLD Kalbe Farma KLBF 1,680 1,645 2.1 (4.5) (9.2) (8.2) HOLD
Sources: Bloomberg
LAGGARDS
Price as on Code 10-Jun-2015 09-Jun-2015 Chg, % w-w, % m-m, % YTD, % Rating XL Axiata EXCL 3,800 3,880 (2.1) (13.1) (0.4) (21.9) BUY Selamat Sempurna SMSM 4,610 4,700 (1.9) (0.8) 0.1 (2.9) BUY Hexindo Adiperkasa HEXA 2,830 2,885 (1.9) (6.9) (5.0) (19.3) HOLD Wijaya Karya WIKA 2,760 2,800 (1.4) (11.7) (11.7) (25.0) BUY Vale Indonesia INCO 2,825 2,865 (1.4) (10.5) (13.2) (22.1) BUY PP London Sumatra LSIP 1,690 1,710 (1.2) (4.0) 15.4 (10.6) HOLD Adhi Karya ADHI 2,165 2,185 (0.9) (12.0) (24.2) (37.8) BUY Mitra Adi Perkasa MAPI 5,500 5,550 (0.9) (0.9) 4.8 8.4 BUY Bank Negara Indonesia BBNI 5,750 5,800 (0.9) (9.8) (13.5) (5.7) BUY Harum Energy HRUM 1,175 1,185 (0.8) (4.5) (2.9) (29.2) HOLD
Sources: Bloomberg
Danareksa Sekuritas – Equity Research
Equity Research Thursday, June 11, 2015
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Danareksa Sekuritas – Equity Research