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INKP, a 110% higher target price
Current 8,300 Target 17,400 +110%
November 25th 2021
1 minute read
Sales grew 7%
Costs up 6 points
Cashflow lower but average is strong
Balance sheet, lower leverage
Valuation, a 110% higher target price
1 minute read
Sales grew 7%
- Sales grew 7% in the third quarter to 880 million dollars vs our 867 million dollars forecast.
- This brings the quarterly average to 6% growth.
- We predict average growth of 2% to bring sales to 960 million dollars in the third quarter of 2022.
Costs up 6 points
- The cash cost ratio was 6 points higher at -80% in the third quarter giving a 108 million dollars net profit.
- The average Cashflow cost ratio is at -82% now.
- We use the latest -80% cost ratio to predict a 124 million dollars profit in the third quarter of 2022.
Cashflow lower but average is strong
- Free cashflow was lower at 211 million dollars in the third quarter with -25 million dollars investment Cashflow.
- Average quarterly Cashflow is at 72 million dollars now.
- We assume higher -62 million dollars investment spending which with higher sales gives a 132 million dollars Cashflow in the third quarter of 2022.
Balance sheet, lower leverage
- Cash jumped from 796 to 967 million dollars in the third quarter.
- Liabilities were little changed from 3,941 to 3,998 million dollars so net cash improved from -3,145 to -3,031 million dollars.
- With our forecast cashflow & a -134 million dollars equity payout net cash will be -2,686 million dollars in 12 months time.
Valuation, a 110% higher target price
- INKP capital paid out from the last 27 quarters increased to 618 million dollars in the third quarter & will be 1,071 million dollars in12 months time.
- At the current market value of 3,244 million dollars based on our forecasts it’s at 0.38 X assets with a 17 years payback & a 4% yield.
- Our cashflow forecast is 453 million dollars which means an 7 X valuation. A 15 X valuation gives a 110% higher target price of 17,400 rupiah.
