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SILO, a 56% higher target price
Current 8,325 Target 12,998 (+56%)
October 30th
Sales down
Costs down
Cashflow positive again
Balance sheet, lower leverage
Valuation, a 56% higher target price
Sales down
- Sales were down by -8% in the third quarter to 2,505 billion rupiah which is below our forecast 2,999 billion rupiah.
- This brings the quarterly average growth to 10%
- We predict average growth of 3% in this next 12 months to bring sales to 2,814 billion rupiah in the third quarter of 2022.
Costs down
- Despite lower sales, the cash cost ratio was lower at -81% in the third quarter & net profit almost doubled to 239 billion rupiah.
- The Cashflow cost ratio is now at -82%
- We use the latest -81% cost ratio to predict a 290 billion rupiah profit in the third quarter of 2021.
Cashflow positive again
- Free cashflow was positive again at 209 billion rupiah in the third quarter even with higher investment spending of -131 billion rupiah, as lease payments turned positive.
- Average quarterly Cashflow is now at 154 billion rupiah
- We assume the same -131 billion rupiah investment spending which with higher sales gives a 349 billion rupiah Cashflow in the third quarter of 2021.
Balance sheet, lower leverage
- Cash increased from 850 to 973 billion rupiah in the third quarter.
- Liabilities declined from 2,592 to 2,553 billion rupiah so net cash improved from -1,742 to -1,580 billion rupiah.
- With our forecast cashflow & a -521 billion rupiah equity payout net cash will improve to -601 billion rupiah in 12 months time.
Valuation, a 56% higher target price
- SILO capital from the last six years improved to -1,547 billion rupiah in the third quarter & will improve to -775 billion rupiah in the next 12 months.
- At the current market value of 13,900 billion rupiah based on our forecasts it’s at 1.79X assets with a 6 years payback & a 4% yield.
- Our cashflow forecast is 1,277 billion rupiah which means an 11X valuation. At a 17X valuation gives a 56% higher target price of 12,998 rupiah.
