Japfa Comfeed Indonesia Tbk

  Peningkatan 9,4% pada Penjualan FY2017 Pada 2017 penjualan JPFA meningkat 9,4% yang lebih tinggi dibandingkan dengan peningkatan penjualan 8,2% pada 2016. Namun EBITDA mengalami penurunan 15% pada 2017 dibandingkan dengan kenaikan 55% pada 2016. Divisi pakan ternak sebagai kontributor terbesar terhadap total penjualan mengalami kontraksi EBIT margin dari 13,4% pada 2016 menjadi 9,7% pada 2017.

  Target Harga Rp1.820 Kami menggunakan estimasi forward EV/EBITDA sebesar 6,2x (0,6 SD di atas rata-rata 3 tahun sebesar 5,4x) sebagai basis metode valuasi untuk memperoleh target harga. Target harga ini mengimplikasikan EV/EBITDA 2018E sebesar 7,4x. Saat ini, JPFA diperdagangkan pada EV/EBITDA 2017E sebesar 6,7x.

  Last Price (IDR) 1,460 Price date as of Mar 27, 2018 52 wk range (Hi/Lo) 1,710/1,075 Free float (%)

  37.0 Outstanding sh.(mn) 11,411 Market Cap (IDR bn) 17,001 Market Cap (USD mn) 1,275 Avg. Trd Vol - 3M (mn)

  5.07 Avg. Trd Val - 3M (bn)

  6.80 Foreign Ownership 99.9%

  Basic Industry Poultry Bloomberg

JPFA IJ

  Reuters JPFA.JK Joni Wintarja

  Potensi Keuntungan dari Divisi Broiler Kami berharap kebijakan pemerintah yang menetapkan harga jual terendah untuk ayam broiler dapat memberikan margin keuntungan yang lebih stabil. Kami mengamati bahwa pada 2017, hanya dua dari 12 bulan di mana harga broiler berada di atas harga acuan terendah dari pemerintah.

  Kontraksi Margin Tahun 2016 merupakan tahun istimewa di mana kondisi pasar dengan harga komoditas agri yang murah menyebabkan EBIT margin divisi pakan ternak berada pada posisi 13,4%. Rata-rata EBIT margin divisi pakan ternak sepanjang 4 tahun terakhir adalah sebesar 11,4%. Pada 2017 EBIT margin turun ke level 9,7% akibat tingginya harga jagung domestik.

• 62 21 797 6202, ext:138

  Sales growth 8.2% 9.4% 14.2% 14.3%

  Dividend yield 1.0% 3.8% 1.6% 2.6% Source: Company Data, Bloomberg, NHKS Research

  Please consider the rating criteria & important disclaimer Company Report | Mar 28, 2018 Japfa Comfeed Indonesia Tbk (JPFA) Laba Masih Memuaskan Buy Dec 2018 TP (IDR) 1,820 Consensus Price (IDR) 1,715 TP to Consensus Price +6.1% vs. Last Price +24.7% Shares data

  Joni.wintarja@nhsec.co.id

  Japfa Comfeed Indonesia , Tbk | Summary (IDR bn) 2016/12A 2017/12A 2018/12E 2019/12E

  Sales 27,063 29,603 33,793 38,625

• -

  51.7% 62.3% 20.7%

  Abs. Ret. 15.0% -5.4% 10.7% -4.5% Rel. Ret. 15.8% -1.0% 7.7% -18.7%

  12M

  3M

  1M

  Share Price Performance YTD

  14 50 24 39

  EBITDA 3,563 3,022 3,424 4,044 Net profit 2,065 997 1,619 1,955 EPS (IDR) 181 87 142 171

  P/E 8.0x 14.9x 10.6x 8.8x P/BV 1.8x 1.5x 1.5x 1.4x EV/EBITDA 6.0x 6.9x 6.7x 5.7x DPS (IDR)

  16.3% 9.2% 11.7% 13.2%

  ROIC

  11.3% 4.9% 7.3% 8.2%

  ROA

  ROE

  7.6% 3.4% 4.8% 5.1%

  BVPS (IDR) 821 858 976 1,108 EBITDA margin 13.2% 10.2% 10.1% 10.5% NPM

  EPS growth 340.9%

  26.7% 10.4% 15.5% 16.4%

  Sekilas tentang JPFA JPFA merupakan salah satu perusahaan agri-food terbesar dan terkemuka di tanah air, dan penghasil protein hewani berkualitas dan terpercaya yang dengan setia melayani kebutuhan serta menjadi kebanggaan Indonesia sejak 1975.

  Kunci kesuksesan JPFA berakar dari konsep layanan terpadu, lengkap, dan menyeluruh yang diberikan kepada seluruh pelanggan JPFA melalui kekuatan jaringan distribusi, dan keagenan yang tersebar di seluruh wilayah Indonesia. JPFA senantiasa menciptakan dan memberikan nilai-nilai tambah kepada mitra industri melalui kekuatan rantai produksi dari formulasi pakan ternak berkualitas, bibit ternak unggul, peternakan ayam broiler, ikan, udang, dan sapi potong hingga produk-produk makanan olahan yang menyeluruh dan terintegrasi.

  Daya Saing JPFA di Asia Pasifik Dengan total aset di atas USD1 miliar, JPFA memiliki potensi pertumbuhan laba yang paling tinggi dengan P/E yang paling murah hanya sebesar 10,6x. Dua kekuatan tersebut membuat JPFA menjadi pilihan yang paling atraktif di Asia Pasifik.

  Asia Pacific Poultry Market Total Asset Net Profit Net Profit Company Cap ROE P/E P/BV Dividend (USD mn) Growth Margin Yield (USD mn)

  JPFA 1,275 1,552 62.3% 4.8% 15.5% 10.6x 1.5x 1.6% CPIN 4,082 1,788 31.4% 6.2% 20.6% 15.9x 3.1x 2.0% MAIN 113 289 648.3% 2.7% 8.5% 10.3x 0.8x 1.4%

  Thailand

  CHAROEN POKPHAND FOODS 6,895 18,221 3.8% 3.0% 10.1% 12.8x 1.2x 3.8%

  Malaysia

  CAB CAKARAN CORP BHD 146 252 68.7% 3.9% 19.2% 8.6x 1.4x 0.3%

  India

  GODREJ AGROVET LTD 1,899 496 5.7% 5.1% 27.8% 45.8x 11.8x 2.0%

• AVANTI FEEDS LTD 1,506 163 162.4% 7.8% 45.0% 21.6x 3.7x 0.4%

  Vietnam

  MASAN GROUP CORP 4,689 2,798 11.1% 8.2% 20.6% 35.5x 7.2x 1.1%

  China

  CHUYING AGRO-PASTORA GROUP-A 1,934 2,439 1.2% 14.3% 15.3% 16.3x 2.2x 1.7%

• TECON BIOLOGY CO LTD - A 1,188 647 11.6% 8.9% 14.6% 18.9x 2.6x 1.3% BAIYANG INVESTMENT GROUP -A 671 276 32.8% 2.9% 5.0% 42.9x 2.0x 0.5% NEW HOPE LIUHE CO LTD-A 4,994 5,387 10.0% 4.1% 11.2% 13.8x 1.5x 6.7%
• JUEWEI FOOD CO LTD-A 2,152 283 26.4% 11.7% 28.7% 31.3x 8.2x 1.0% SHANDONG LONGDA MEAT FOOD-A 1,232 331 16.1% 4.3% 10.5% 40.9x 4.1x 0.9%
• Source: Bloomberg, NHKS research

  Performance Highlights Sales Breakdown | FY2017 Sales Trend | 2014 - 2018

  Source: Company, NHKS research Source: Company, NHKS research

  Sales Growth | 2013 - 2017 Feed Division Metric | 2013 - 2017

  Source: Company, NHKS research Source: Company, NHKS research

  Feed Division Sales Growth | 2016 - 2017 Feed Division EBIT Margin | 2016 - 2017

  Source: Company, NHKS research Source: Company, NHKS research

  Multiple Valuation Forward EV/EBITDA Band | Last 3 years Dynamic Forward EV/EBITDA Band | Last 3 years

  Source: NHKS research Source: NHKS research

  Rating and target price update Target Price Revision Date Rating Target Price Last Price Consensus vs Last Price vs Consensus

  03/15/2017 Buy 2,240 (Dec 2017) 1,595 2,029 +40.4% +10.4% 06/22/2017 Buy 1,860 (Dec 2017) 1,350 1,532 +37.8% +21.4% 08/10/2017 Buy 1,710 (Dec 2017) 1,110 1,489 +54.1% +14.8% 11/10/2017 Buy 1,740 (Dec 2018) 1,275 1,628 +36.5% +6.9% 01/25/2018 Buy 1,820 (Dec 2018) 1,460 1,649 +24.7% +10.4% 03/28/2018 Buy 1,820 (Dec 2018) 1,460 1,715 +24.7% +6.1%

  Source: NHKS research, Bloomberg

  Analyst Coverage Rating Closing and Target Price

  Source: Bloomberg Source: NHKS research

  NH Korindo Sekuritas Indonesia (NHKS) stock ratings

  1. Period: End of year target price

  2. Rating system based on a stock’s absolute return from the date of publication : Greater than +15%

   Buy : -15% to +15%  Hold : Less than -15%  Sell

  Summary of Financials

DISCLAIMER

INCOME STATEMENT BALANCE SHEET

  

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errors, omissions, misstatements, negligence, inaccuracy arising herefrom. All rights reserved by PT NH Korindo Securities Indonesia ^{JPFA Summary Last Price (IDR) 1,460}

^{Target Price (IDR) 1,820 2016/12A 2017/12A 2018/12E 2019/12E}

^{Rating: Buy ROE 26.7% 10.4% 15.5% 16.4% ROA 11.3% 4.9% 7.3% 8.2% ROIC 16.3% 9.2% 11.7% 13.2% EBITDA/Equi ty 46.0% 31.5% 32.7% 34.0%}

^{in IDR Bn 2016/12A 2017/12A 2018/12E 2019/12E EBITDA/As s ets 11.3% 4.9% 7.3% 8.2%}

^{Sales 27,063 29,603 33,793 38,625 Ca s h Di vi dend IDR bn) 160 570 275 447}

^{Growth (% y/y) 8.2% 9.4% 14.2% 14.3% Di vi dend Yi el d (%) 1.0% 3.8% 1.7% 2.7%}

^{Cost of Revenue (21,584) (24,572) (27,901) (31,813) Pa yout Ra ti o (%) 34.1% 27.6% 27.6% 27.6%}

^{Gross Profit 5,479 5,031 5,892 6,812 DER 62.6% 62.0% 54.5% 41.3%}

^{Gross Margin 20.2% 17.0% 17.4% 17.6% Net Gea ri ng 91.0% 89.7% 74.8% 54.3%}

^{Opera ti ng Expens es (2,558) (2,781) (3,303) (3,775) LT Debt to Equi ty 38.5% 53.8% 39.7% 35.0%}

^{EBIT 2,921 2,250 2,589 3,036 Ca pi ta l i za ti on Ra ti o 38.5% 38.3% 35.3% 29.2%}

^{EBIT Margin 10.8% 7.6% 7.7% 7.9% Equi ty Ra ti o 48.7% 46.4% 48.1% 52.0%}

^{Depreci a ti on 642 772 835 1,008 Debt Ra ti o 30.5% 28.8% 26.2% 21.5%}

^{EBITDA 3,563 3,022 3,424 4,044 Fi na nci a l Levera ge 221.7% 200.9% 201.5% 194.8%}

^{EBITDA Margin 13.2% 10.2% 10.1% 10.5% Current Ra ti o 213.0% 234.6% 199.2% 212.3%}

^{Interes t Expens es (510) (569) (556) (556) Qui ck Ra ti o 75.3% 66.7% 54.8% 45.7%}

^{EBT 2,767 1,741 2,429 2,933 Ca s h Ra ti o 52.0% 34.4% 30.4% 16.9%}

^{Income Ta x (595) (633) (607) (733) Cash Conversion Cycle 83.0 80.1 74.4 74.4 Mi nori ty Interes t (107) (110) (203) (245) Pa r Va l ue (IDR) 200 200 200 200}

^{Net Profit 2,065 997 1,619 1,955 Tota l Sha res (mn) 11,411 11,411 11,411 11,411}

^{Growth (% y/y) 340.9% -51.7% 62.3% 20.7% Sha re Pri ce (IDR) 1,455 1,300 1,460 1,460}

^{Net Profit Margin 7.6% 3.4% 4.8% 5.1% Ma rket Ca p (IDR tn) 16.6 14.8 16.7 16.7 In IDR bn 2016/12A 2017/12A 2018/12E 2019/12E 2016/12A 2017/12A 2018/12E 2019/12E}

^{Ca s h 2,701 1,642 1,891 1,014 Pri ce /Ea rni ngs 8.0x 14.9x 10.3x 8.5x}

^{Recei va bl es 1,212 1,541 1,513 1,729 Pri ce /Book Va l ue 1.8x 1.5x 1.5x 1.3x}

^{Inventori es 6,259 7,332 8,091 9,225 Pri ce/Sa l es 0.6x 0.5x 0.5x 0.4x}

^{Total Current Assets 11,061 11,189 12,377 12,747 PE/EPS Growth 0.0x -0.3x 0.2x 0.4x}

^{Net Fi xed As s ets 7,541 8,386 9,751 10,685 EV/EBITDA 6.0x 6.9x 6.5x 5.5x}

^{Other Non Current As s ets 649 1,514 1,038 883 EV/EBIT 7.3x 9.3x 8.7x 7.4x}

^{Total Assets 19,251 21,089 23,166 24,315 EV (IDR bn) 21,249 20,836 22,413 22,439}

^{Pa ya bl es 2,317 3,216 3,652 4,164 Sa l es CAGR (3-Yr) 8.1% 6.6% 10.5% 12.6%}

^{ST Ba nk Loa n 2,260 797 1,647 797 EPS CAGR (3-Yr) 51.4% 43.2% 51.2% -1.8%}

^{Other Current Liab. 616 756 914 1,044 Ba s i c EPS (IDR) 181 87 142 171 LT Debt 3,609 5,272 4,422 4,422 Di l uted EPS (IDR) 181 87 142 171}

^{Other Non Current Li a b. 1,075 1,251 1,391 1,239 BVPS (IDR) 821 858 976 1,108}

^{Total Liabilities 9,878 11,293 12,026 11,667 Sa l es PS (IDR) 2,372 2,594 2,962 3,385}

^{Shareholders' Equity 9,373 9,796 11,139 12,648 DPS (IDR) 14 50 24 Net Income 2,065 997 1,619 1,955 DCF (IDR bn) 39 In IDR bn 2016/12A 2017/12A 2018/12E 2019/12E 2016/12A 2017/12A 2018/12E 2019/12E}

^{Deprec & Amorti za ti on 642 772 835 1,008 NOPAT 2,293 1,432 1,942 2,277}

^{Chg. In Worki ng Ca pi ta l 73 (965) (345) (604) +Depr./Amor. 642 772 835 1,008}

^{CFO 2,780 805 2,109 2,358 -CAPEX (787) (1,537) (2,200) (1,941)}

^{Ca pex (787) (1,537) (2,200) (1,941) -Incr. (Decr.) i n Worki ng Ca p. 73 (965) (345) (604)}

^{CFI (524) (1,399) (1,585) (1,938) (Unl evered) FCFF 2,221 (297) 231 739}

^{Di vi dends Pa i d (240) (536) (275) (447) WACC}

^{Net Borrowi ng (PMT) (829) 200 - (850) Cos t of Debt (Ta x Adj.) 9.3% 7.6% 8.8% 8.9%}

^{CFF (456) (466) (275) (1,297) Cos t of Equi ty (COE) 10.5% 12.3% 12.3% 12.3%}

^{Net Changes in Cash 1,800 (1,059) 249 (876) WACC (%) 10.2% 10.9% 11.4% 11.5%}

^{RIM Sprea d (FROE-COE) (%) 23.3% -1.7% 4.2% 5.2% Res i dua l Income (IDR bn) 1,421 (156) 414 585}

^{By Geography % Shareholders % Equi ty Cha rge 643 1,153 1,205 1,370}

^{Si nga pore 75.2 Ja pfa PTE LTD 51.0 EVA Uni ted Sta tes 5.8 KKR Ja de INV 12.0 Inves ted Ca pi ta l (IDR bn) 12,934 15,242 15,865 17,209 Irel a nd 0.2 Va ngua rd Group 2.2 ROIC-WACC (%) 7.5% -1.5% 0.9% 1.7% Luxembourg 0.2 Di mens i ona l Fund 1.3 EVA (IDR mn) 971 (235) 139 299}

  OWNERSHIP PROFITABILITY & STABILITY March 27, 2018 _{Dec 2018}

  ^{Analyst: Joni Wintarja} CASH FLOW STATEMENT DCF, RIM & EVA