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Sunday, November 6, 2011

Indonesian Strategy Decent 3Q11 Results

by CITIGROUP

Indonesian Strategy Decent 3Q11 Results; 9M11 Earnings Growth +27% YoY vs. FYConsensus Growth of +20%

3Q11 net profit were up 3% QoQ and 22% YoY; 9M11 net profit were up 27% YoYvs. FY consensus of 20% YoY —n

Banks and commodities performed best, up 38%and 65% respectively, accounting for 76% and 73% of our FY forecast respectively.


However, the domestic sector was the underperformer (up only 11% YoY) dragged down by telcos, cement, PGAS and Indofood. We expect FY11 net profit growth could reach consensus expectations of +20% YoY.

n 4Q outlook still strong; Still positive —The bank, coal, auto and property sectors willremain drivers of growth in 4Q11 and 2012.

We maintain our positive view on the market and believe that it will still offer a positive return till next year. The market is trading on 2012 PER of 12.5x with EPS growth of 15% and ROE of 24.4%.

Our top picks are Astra International, Bank Mandiri, Bank Rakyat, United Tractors, Jasamarga,Semen Gresik and Indomobil.

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