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Thursday, April 21, 2011

PT Indofood CBP Sukses Makmur Tbk

by Kresna Securities

We reiterate our BUY recommendation on the counter with TP at Rp5,575. In line with our expectation, the company posted strong financial performance in 2010.  Revenue jumped by 10% YoY to Rp18.0tr, while the bottom line surged by 58% YoY to Rp1.7tr. Aggressive expansion plans supported by strong balance sheet (net cash of Rp3.0tr in this year) will potentially boost the company's performance going forward. We expect net income to grow by 18.6% YoY in 2013 and 15.5% YoY in 2014 with the completion of dairy production facility.

• FY10 result inline with our estimation. The company's performance in 2010 was relatively inline with our forecast. Compared to our forecast, the company's revenue  deviated by 0.6%, gross margin deviated by 0%, operating profit deviated by 1.2% while net income deviated by 3.2%. Our net income projection is slightly below the actual result due to higher interest expenses of Rp135.4bn vs actual Rp83.5bn.


• Promising picture in 2011. We expect the company to be able to deliver Rp20.3tr revenue, implying to a growth of 12.9% YoY on the back of splendid volume growth in noodle, which we expect to reach 12.0bn packs of noodle, an increase of 4.5% YoY, along with 7.2% price increases this year. However, at the bottom line, we conservatively predict the company to book net income of Rp1.9tr, a growth of 9.1% YoY. In addition, we also expect the company to be able to maintain its net profit margin above 9%.

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