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SMAR, a 100% higher target price
Current 4,880 Target 9,776 +100%

November 6th 2021
1 minute read
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Sales jumped another 31%

• Sales jumped another 31% in the third quarter to 16,595 billion rupiah vs our 13,066 billion rupiah forecast.
• This brings the quarterly average to 17% growth.
• We predict average growth of 3% in this next 12 months to bring sales to 18,658 billion rupiah in the third quarter of 2022.

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Costs, one point higher

• The cash cost ratio was one point higher at -94% in the third quarter giving a 792 billion rupiah net profit.
• The Cashflow cost ratio is at -95% now.
• We use the latest -94% cost ratio to predict a 843 billion rupiah profit in the third quarter of 2022.

Cashflow back to 1 trillion rupiah

• Free cashflow was back up at 999 billion rupiah in the third quarter with -183 billion rupiah investment Cashflow.
• Average quarterly Cashflow is still negative at -202 billion rupiah now.
• We assume -183 billion rupiah investment spending which with higher sales gives a 928 billion rupiah Cashflow in the third quarter of 2022.

​Balance sheet, but higher leverage

• Cash declined from 3,497 to 2,335 billion rupiah in the third quarter.
• Liabilities increased from 24,157 to 24,587 billion rupiah so net cash worsened from -20,660 to -22,252 billion rupiah
• With our forecast cashflow & a -635 billion rupiah equity payout net cash will be -19,376 billion rupiah in 12 months time.

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Valuation, a 100% higher target price

• SMAR capital from the last 27 quarters improved to -4,007 billion rupiah in the third quarter & will be -496 billion rupiah in12 months time.
• At the current market value of 14,020 billion rupiah based on our forecasts it’s at 0.37 X assets with a 10 years payback & a 5% yield.
• Our cashflow forecast is 3,511 billion rupiah which means an 4 X valuation. An 8 X valuation gives a 100% higher target price of 9,776 rupiah.

Data file & model