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LPCK, a 104% higher target price
​Current 1,015 Target 2,073 +104%

November 3rd 2021
1 minute read

Sales jump 27%
  • Sales jumped 27% in the third quarter to 526 billion rupiah which is above our 408 billion rupiah forecast.
  • This brings the quarterly average to 11% growth.
  • We predict average growth of 11% again in this next 12 months to bring sales to 787 billion rupiah in the third quarter of 2022.

Costs higher..
  • The cash cost ratio was higher again at -75% in the third quarter giving a lower 108 billion rupiah net profit:
  • The Cashflow cost ratio is still above 100% at -126% now.
  • We use the latest -75% cost ratio to predict a 190 billion rupiah profit in the third quarter of 2022.

Cashflow negative again from working capital
  • Free cashflow was negative again -44 billion rupiah in the third quarter from working capital with 2 billion rupiah investment gains.
  • Average quarterly Cashflow is at -74 billion rupiah now.
  • We assume 0 billion rupiah investment spending which with higher sales gives a hopefully positive 196 billion rupiah Cashflow in the third quarter of 2022.

Balance sheet, slightly lower leverage
  • Cash from declined 591 to 377 billion rupiah in the third quarter.
  • Liabilities declined from 3,044 to 2,772 billion rupiah so net cash improved slightly from -2,453 to -2,395 billion rupiah
  • With our forecast cashflow & a -67 billion rupiah equity payout net cash will be -1,767 billion rupiah in 12 months time.

Valuation, a 104% higher target price
  • LPCK capital from the last years improved to -7,724 billion rupiah in the third quarter & will improve to -7,143 billion rupiah in12 months time.
  • At the current market value of 2,720 billion rupiah based on our forecasts it’s at 0.28 X assets with a 13 years payback & a 2% yield.
  • Our cashflow forecast is 694 billion rupiah which means an 4 X valuation.​ At a 8 X valuation gives a 104% target price of 2,073 rupiah.