## RAJA, another little gem

Current, target price Rp246, 928 (+277%)

April 14th, 2021

1 minute read

Sales, finally up

Cashflow, strong on low investment

1 minute read

Sales, finally up

- Sales finally jumped +17% in the fourth quarter to 25 million dollars.
- This is after a -11% decline in the third quarter, -20% in the second quarter, -9% in the first, bringing the quarterly average growth to -6%.
- We predict a positive +6% quarterly average growth in this next 12 months, bringing sales back to 31 million dollars by the fourth quarter of 2021.

Cashflow, strong on low investment

- Cashflow was positive again +6 million dollars in the fourth quarter, up from +4 million dollars in the third quarter.
- The quarterly average free cashflow is now at +3 million dollars.
- We use the latest quarter investment spending of 2 million dollars, which with higher sales gives an average +2 million dollars a quarter free cashflow in this next 12 months.

## Sales finally jump back, cashflow strong on low investment, heading to net cash, only 0.2X assets, much higher target price....

Balance sheet, heading to net cash

Profit, good margins

Value, only 0.2X assets

- Positive cashflow has improved the net leverage of cash minus total liabilities to -5 million dollars in the fourth quarter, from -9 million dollars in the third quarter & -35 million dollars a year ago.
- With our forecast positive cashflow & assuming a dividend payout of 3 trillion dollars...
- ...the net cash will turn positive +1 million dollars in 12 months time.

Profit, good margins

- Net profit was positive again at +2 million dollars in the fourth quarter from a small loss in the third quarter.
- The cash cost ratio of net profit add depreciation minus sales as a percent of sales improved to 84%.
- We use the same 84% costs to predict a higher next 12 months net profit of +11 million dollars.

Value, only 0.2X assets

- RAJA has paid out 29 million dollars of capital in the last five years.
- At the current market value of 74 million dollars, it’s at just 2.5X capital paid, 0.68X sales, only 0.2X assets, 0.57X equity with an 8.1% profitability & a 4.3% yield.
- Our free cashflow forecast is +9 million dollars. At 1.6% with a 0.5X adjustment, gives a 277% higher target price of Rp928.