Other stocks here
SRIL, will they finally get to Cashflow positive?
Current, target price
Rp204, 396 (+94%)
April 4th, 2021
1 minute read
Sales, all-time high
Cashflow, still negative
1 minute read
Sales, all-time high
- Sales jumped by 26% in the fourth quarter to USD 376 million which is 9% ahead of our forecast.
- This is after 3% growth in the third quarter & brings the average quarterly growth to 8%.
- We predict average growth of 4% in this next 12 months & sales to reach USD 441 million by the fourth quarter of 2021.
Cashflow, still negative
- Cashflow was still negative -USD 33 million in the fourth quarter but better than -USD 73 million in the third quarter.
- The average quarterly Cashflow is -USD 32 million.
- We use the latest quarter investment spending USD 23 million, which with higher sales gives a finally positive average quarterly free Cashflow of +USD 23 million in this next 12 months.
Sales at all time high, better margins, but cashflow still negative, if Cashflow turns positive, huge upside potential...
Balance sheet, higher leverage
Profit, better margins
Value, so cheap
- With negative cashflow, the net leverage of cash minus total liabilities was -USD 992 million in the fourth quarter from -USD 914 million in the third quarter & -USD 798 million a year ago.
- With our forecast for positive cashflow & a dividend payout of USD 9 million...
- ...the net cash will be -USD 909 million in 12 months time.
Profit, better margins
- Net profit was positive +USD 12 million in the fourth quarter from -USS 4 million in the third quarter.
- The cash cost ratio of net profit add back depreciation minus sales as a percent of sales was lower at 91%.
- We use the average 89% cost ratio to predict a higher next 12 months net profit of USD 94.4 million.
Value, so cheap
- SRIL has raised USD 452 million of capital in the last six years.
- At the current market value of USD 298 million, it’s at only 0.18X sales, 0.16X assets, 0.39X equity with a 12.5% profitability & a 3.2% yield.
- Our cashflow forecast is USD 92.4 million. At 1.6% with a 0.1X adjustment, gives a 94% higher target price of Rp396.