FY17 indicative results: Broadly in line. Maintain Trading Buy and TP of IDR1,870. KLBF s consolidated gross profit margin (GPM) 48.5% 47.5% 48.

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Mimi Halimin +62-21-515-1140 [email protected] To subscribe to our Daily Focus, please contact us at [email protected]

Mirae Asset Sekuritas Indonesia

KLBF’s consolidated gross profit margin

Source: Mirae Asset Sekuritas Indonesia Research

Februari 15, 2018

KLBF’s FY17 indicative review: As expected FY17 indicative results: Broadly in line

Berdasarkan unaudited results, KLBF membukukan pendapatan FY17 sebesar IDR20.2tr (+4.3% YoY), mencapai 98.4% dari perkiraan kami dan 97.7% dari konsensus. Penjualan divisi nutrisi (+8.7% YoY) dan obat resep (+5.0% YoY) melampaui pertumbuhan penjualan bersih konsolidasi KLBF secara keseluruhan, sementara divisi distribusi & logistik (+1.7% YoY) dan consumer health (+0.4%

YoY) underperformed di tengah kondisi pasar yang challenging. Manajemen menyatakan bahwa pertumbuhan pendapatan FY17 didorong oleh volume.

Sementara itu, marjin laba kotor turun menjadi 48.5% pada FY17 (dari 49.0% pada FY16), sementara laba usaha naik 4.6% menjadi IDR3.2tr (dari IDR3.1tr pada FY16), dengan marjin OP stabil di 15.8% dikarenakan KLBF lebih banyak melakukan kegiatan pemasaran yang efektif. KLBF membukukan laba bersih FY17 sebesar IDR2.4tr (+3.5% YoY).

Short-term headwinds in pharmaceutical business

Manajemen KLBF mengungkapkan bahwa banyak pabrik farmasi kimia telah ditutup di China karena peraturan lingkungan yang baru, menyebabkan kenaikan harga bahan baku pada Januari-Februari. Kami pikir masalah ini kemungkinan akan membebani margin di divisi obat resep KLBF tahun ini. Kami belum memperhitungkan masalah ini ke dalam forecast kami. Namun, kami mencatat bahwa meski mendapat tantangan jangka pendek, masalah ini mungkin bisa bermanfaat bagi KLBF dalam jangka panjang seiring dengan berkurangnya jumlah produsen farmasi yang lebih kecil.

Maintain Trading Buy and TP of IDR1,870

Kami mempertahankan rekomendasi Trading Buy kami di KLBF dengan target harga IDR1,870.

Market Index

Last Trade Chg (%) MoM YoY

JCI 6,594.4 0.2 3.1 22.3

MSCI Indonesia 29.7 0.8 0.6 17.7

MSCI EM 1,185.3 1.8 -3.6 24.7

HANG SENG 30,515.6 2.3 -4.8 24.4

KOSPI 2,395.2 1.1 -4.3 14.9

FTSE 7,214.0 0.6 -7.7 -1.8

DJIA 24,893.5 1.0 -4.5 19.5

NASDAQ 7,143.6 1.9 -3.4 20.5

Valuation

2018F P/E (x) P/B (x) ROE (%)

JCI 16.9 2.7 17.6

Key Rates

Last Trade Chg (bps) MoM YoY

BI 7-Day RR 4.25 0 0 -100

3yr 5.73 -1 12 -137

10yr 6.41 0 21 -114

FX

USD/IDR 13,629.00 -0.2 2.4 2.4

USD/KRW 1,084.55 0.0 2.1 -4.6

USD/JPY 107.01 -0.8 -3.2 -6.3

USD/CNY 6.34 0.2 -1.5 -7.7

Commodities

WTI 60.6 2.4 -5.8 15.6

Gold 1,350.7 1.6 0.8 9.5

Coal 104.4 1.7 -1.4 30.7

Palm Oil 2,506.0 -0.2 1.3 -23.6

Rubber 126.4 0.5 2.8 -42.8

Nickel 14,100.0 4.8 10.8 30.9

Copper 7163.0 2.5 0.7 19.0

Tin 21,550.0 0.2 6.0 7.9

JCI Index VS MSCI Emerging Markets

800 950 1,100 1,250

5,000 5,500 6,000 6,500 7,000

01/17 04/17 07/17 10/17 01/18

JCI MSCI EM (pt)

(pt)

650 800 950 1,100

3,500 4,500 5,500

04/13 01/14 10/14 07/15 04/16

(pt) JCI MSCI EM (pt)

48.0%

48.8%

48.0%

49.0%

48.5%

43.5%

44.5%

45.5%

46.5%

47.5%

48.5%

49.5%

2013 2014 2015 2016 2017*)

(GPM)

*) indicative results

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Mirae Asset Sekuritas Indonesia 2

Mirae Asset Sekuritas Indonesia cartoon

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Local flashes

DILD: Intiland bidik marketing sales 2018 sebesar Rp 3,3 triliun. PT Intiland Development Tbk (DILD) optimisris bisnis properti akan lebih bergairah tahun ini.

Terbukti dari langkah perusahaan dalam mematok target. Tahun ini, DILD menargetkan marketing sales atau penjualan pemasaran Rp 3,3 triliun sepanjang 2018. Target tersebut tumbuh 15% dibandingkan pencapaian penjualan pemasaran DILD pada tahun 2017 yang sebesar Rp 2,93 triliun. (Kontan)

PTBA: PTBA tidak keberatan aturan harga DMO batubara. Harga batubara yang terus menanjak berisiko memicu tarif listrik ikut naik. Untuk mengantisipasi hal ini, pemerintah bersiap mengeluarkan beleid yang mengatur harga jual batubara untuk keperluan domestik, terutama untuk keperluan Pembangkit Listrik Tenaga Uap (PLTU).

Kementerian Energi dan Sumber Daya Mineral (ESDM) rencananya akan mengeluarkan SK Menteri ESDM soal batas bawah dan batas atas harga jual batubara untuk kepentingan pasar dalam negeri alias domestic market obligation (DMO), Kamis (15/2) nanti. PLN mengusulkan harga batas bawah berada di level US$ 60 per ton, sedangkan batas atas di level US$ 70 per ton., Direktur Utama PTBA Arviyan Arifin mengaku tidak keberatan soal aturan ini. "Kami tidak ada masalah terkait aturan pembatasan harga ini karena kami harus mendukung sesama BUMN sebagai bentuk sinergi," ungkapnya Rabu (14/2). (Kontan)

PSAB: J Resources akan terbitkan MTN senilai Rp 300 miliar. PT J Resources Asia Pasifik Tbk (PSAB) melalui anak usahanya, PT J resources Nusantara, bakal menerbitkan surat utang jangka menengah atawa medium term notes (MTN). Mengutip keterbukaan Kustodian Sentral Efek Indonesia (KSEI), Rabu (14/2), MTN IV J Resources Nusantara Tahap I Tahun 2018 memiliki nilai pokok Rp 300 miliar. (Kontan)

WEGE: Wika Gedung raih kontrak baru Rp 422 miliar per Januari 2018. PT Wijaya Karya Bangunan Gedung Tbk (WEGE) membukukan kontrak baru per Januari 2018 sebesar Rp 422,05 miliar."Kontrak baru tersebut berasal dari tiga proyek yang ada di Palembang, Semarang, dan Pekalongan," kata Direktur Keuangan WEGE Abiprayadi Riyanto kepada Kontan.co.id, Rabu (14/2). (Kontan)

WINS: Private placement, Wintermar tetapkan harga Rp 350 per saham. PT Wintermar Offshore Marine Tbk (WINS) menerbitkan 200 juta saham baru lewat penambahan modal tanpa hak memesan efek terlebih dahulu (PMTHMETD) alias private placement. Keterbukaan informasi WINS, Rabu (14/2), menyebutkan, aksi private placementini dilakukan oleh PT Wintermarjaya Lestari, yang sebelumnya memiliki 1,48 miliar atau 36,774% saham WINS. Saham baru dengan nilai nominal Rp 100 per saham dilepas pada harga pelaksanaan Rp 350 per saham. (Kontan)

ENRG: Produksi Energi Mega Persada di Blok Bentu akan meningkat dua kali lipat. PT Energi Mega Persada Tbk (ENRG) melalui anak usahanya, EMP Bentu Limited, baru saja memperoleh kontrak penjualan gas untuk PT Pertamina. Dengan perolehan kontrak itu, kinerja perusahaan diharapkan bisa terdongkrak. Deputi Direktur Utama ENRG Syailendra Bakrie mengatakan, sepanjang 2017, Blok Bentu memproduksi 7,9 million barel oil of equivalent per day (mboepd) atau setara sekitar 28% dari total produksi perusahaan, 27,8 mboepd. "Produksi ini diharapkan akan meningkat dua kali lipat di 2019," ujar Syailendra, Rabu (14/2). (Kontan)

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Chart 1. JCI Vs. USD/IDR Chart 2. JCI performance (absolute vs. relative)

Source: Bloomberg, Mirae Asset Sekuritas Indonesia Note: Relative to MSCI EM Index

Source: Bloomberg, Mirae Asset Sekuritas Indonesia

Chart 3. Foreigner’s net purchase (EM) Chart 4. Energy price

Note: The latest figure for India are February 12^th, 2018

Source: Bloomberg, Mirae Asset Sekuritas Indonesia Source: Bloomberg, Mirae Asset Sekuritas Indonesia

Chart 5. Non-ferrous metal price Chart 6. Precious metal price

Source: Bloomberg, Mirae Asset Sekuritas Indonesia Source: Bloomberg, Mirae Asset Sekuritas Indonesia 13,100

13,200 13,300 13,400 13,500 13,600 13,700 13,800

5,400 5,600 5,800 6,000 6,200 6,400 6,600 6,800

11/15 12/13 1/10 2/7

(IDR)

(pt) JCI (L) USD/IDR (R)

0.2 0.9

3.3

22.6

-1.5 -0.1

5.2

-4.3 -8

-4 0 4 8 12 16 20 24

1D 1W 1M 1Y

Absolute Relative (%, %p)

153

-748

-39 -60 -14

-137 -179

-3,128 -282

-634 -68

-1,124

-3,500 -3,000 -2,500 -2,000 -1,500 -1,000 -500 0 500

Korea Taiwan Indonesia Thailand Philippines India

1 Day 5 Days

(USDmn)

75 80 85 90 95 100 105 110 115 120 125

11/15 12/13 1/10 2/7

CPO WTI Coal

(D-3M=100) (D-3M=100)

80 85 90 95 100 105 110 115 120 125

11/17 12/17 01/18 02/18

(D-3M=100) Copper Nickel Tin

80 85 90 95 100 105 110 115

11/17 12/17 01/18 02/18

(D-3M=100) Silver Gold Platinum

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Mirae Asset Sekuritas Indonesia 5 Table. Key valuation metrics

Company Name Ticker

Price Market Cap Price Performance (%) P/E(X)* P/B(X)* ROE(%)*

(IDR) (IDRbn) 1D 1W 1M 1Y FY18 FY19 FY18 FY19 FY18 FY19

Jakarta Composite Index JCI 6,594 7,360,668 0.2 0.9 3.3 22.6 16.9 15.2 2.7 2.4 17.6 25.1

FINANCIALS

Bank Central Asia BBCA 23,700 584,324 -0.4 0.9 5.5 52.9 25.3 22.5 4.5 3.9 19.0 18.4

Bank Mandiri Persero BMRI 8,300 387,333 0.3 2.2 1.2 45.3 18.1 19.0 2.2 2.4 13.0 12.8

Bank Rakyat Indonesia Persero BBRI 3,860 476,115 -0.5 4.3 8.7 60.8 15.3 17.1 2.7 2.9 18.5 18.2 Bank Negara Indonesia Persero BBNI 9,700 180,892 0.0 1.6 2.1 54.0 13.6 13.5 1.9 1.9 14.7 14.7

Bank Tabungan Negara Persero BBTN 3,810 40,348 1.3 5.8 4.7 87.7 18.1 17.0 1.7 1.7 9.9 10.5

CONSUMER

HM Sampoerna HMSP 4,880 567,632 0.6 -1.0 0.6 26.8 43.6 39.9 16.0 15.2 37.4 39.2

Gudang Garam GGRM 80,000 153,927 0.0 -3.9 -2.4 30.1 20.6 18.3 3.6 3.2 18.0 18.2

Indofood CBP Sukses Makmur ICBP 8,950 104,374 0.6 1.4 1.1 5.9 27.0 24.8 5.3 4.8 20.6 20.1

Indofood Sukses Makmur INDF 7,825 68,707 1.0 -1.3 0.3 -1.9 15.7 14.7 2.2 2.0 14.4 13.6

Kalbe Farma KLBF 1,620 75,938 0.0 -3.6 -3.6 9.8 31.1 28.4 5.7 5.1 19.3 18.8

Unilever Indonesia UNVR 54,500 415,835 -0.8 -0.3 -0.2 28.5 57.5 51.8 77.7 69.8 143.5 142.2

AGRICULTURAL

Astra Agro Lestari AALI 13,400 25,791 0.0 4.5 0.8 -14.2 12.5 12.4 1.4 1.3 11.5 10.9

PP London Sumatera Indonesia LSIP 1,350 9,211 -0.4 3.4 -0.4 -15.1 11.4 10.8 1.1 1.1 10.0 9.9

Sawit Sumbermas Sarana SSMS 1,450 13,811 0.0 -0.3 1.4 -12.4 22.0 13.8 3.5 3.0 16.2 21.5

INFRASTRUCTURE

XL Axiata EXCL 2,910 31,102 -1.7 -1.7 -8.5 -7.0 84.6 75.5 1.5 1.4 1.8 1.8

Jasa Marga JSMR 5,675 41,188 -1.3 0.0 -9.2 18.7 21.1 17.9 3.1 2.6 15.3 14.9

Perusahaan Gas Negara PGAS 2,500 60,604 5.9 5.5 41.6 -10.7 23.0 18.4 1.4 1.4 5.6 8.2

Tower Bersama Infrastructure TBIG 5,850 26,509 0.0 -0.8 -3.7 12.5 22.4 18.7 13.5 9.0 62.1 57.2

Telekomunikasi Indonesia TLKM 4,040 407,232 0.0 1.5 -1.9 5.1 17.2 15.8 4.2 3.8 25.9 24.8

Soechi Lines SOCI 274 1,934 0.7 2.2 7.9 -10.5 4.0 4.0 N/A N/A 11.3 10.2

Garuda Indonesia GIAA 330 8,543 3.8 7.1 9.3 -10.3 19.1 14.7 2.1 1.9 11.3 12.8

BASIC-INDUSTRIES

Semen Indonesia SMGR 10,850 64,357 3.1 6.6 3.1 16.0 27.5 21.7 2.2 2.0 7.9 9.7

Charoen Pokphand Indonesia CPIN 3,390 55,589 -0.9 3.0 5.3 -1.2 21.6 16.4 3.5 3.0 15.7 17.9

Indocement Tunggal Prakarsa INTP 21,025 77,398 -0.4 1.1 -5.3 35.6 37.2 30.6 3.0 2.8 8.1 9.5

Japfa Comfeed Indonesia JPFA 1,575 17,972 0.0 5.7 12.1 -17.8 13.5 10.0 1.9 1.6 14.8 17.7

MINING

Indo Tambangraya Megah ITMG 29,175 32,966 1.0 1.3 17.4 93.5 10.0 9.1 2.4 2.2 24.9 24.7

Adaro Energy ADRO 2,440 78,046 0.8 -0.4 9.4 48.3 11.2 10.0 1.7 1.5 14.7 14.6

Aneka Tambang ANTM 885 21,267 1.1 1.7 34.1 10.6 N/A 67.4 1.2 1.2 -0.5 1.7

Vale Indonesia INCO 3,630 36,069 0.6 -2.2 12.7 32.0 N/A 26.8 1.8 1.7 -0.7 3.2

Tambang Batubara Bukit Asam PTBA 3,230 37,212 -1.2 1.9 6.6 47.8 9.7 9.2 2.8 2.3 28.9 26.7

TRADE

United Tractors UNTR 37,725 140,719 0.2 -2.0 1.5 63.8 18.6 16.1 3.3 3.0 17.3 17.8

AKR Corporindo AKRA 5,925 23,738 -0.4 6.8 -6.3 -9.5 20.9 19.0 3.1 2.8 15.3 15.6

Global Mediacom BMTR 645 9,158 0.0 -1.5 -6.5 9.3 N/A N/A N/A N/A N/A N/A

Matahari Department Store LPPF 10,375 30,273 -2.8 -0.2 -3.9 -31.5 15.4 14.1 11.5 8.5 90.5 73.6

Media Nusantara Citra MNCN 1,555 22,199 -2.2 0.3 9.1 -2.5 14.5 12.9 2.2 2.0 15.8 16.2

Matahari Putra Prima MPPA 460 2,474 1.3 0.4 8.0 -65.0 N/A 171.8 1.1 1.1 -6.2 -0.2

Surya Citra Media SCMA 2,770 40,502 1.5 -1.1 14.5 -3.5 26.7 24.0 10.4 8.5 40.5 39.4

Siloam International Hospital SILO 8,525 13,860 -0.3 -2.0 -5.0 -38.5 125.0 101.2 2.3 2.4 2.4 2.7 PROPERTY

Bumi Serpong Damai BSDE 1,800 34,644 0.8 0.0 5.9 -4.5 11.6 12.0 1.4 1.3 12.9 11.2

Adhi Karya ADHI 2,370 8,439 -0.4 5.3 11.8 3.9 16.6 11.1 1.4 1.3 8.2 11.2

Alam Sutera Realty ASRI 382 7,506 0.0 -1.0 1.1 -1.0 6.3 7.0 0.9 0.9 15.2 12.0

Ciputra Development CTRA 1,300 24,128 2.8 -1.1 9.7 -7.1 25.0 19.8 1.8 1.7 8.0 8.9

Lippo Karawaci LPKR 520 12,000 0.0 2.0 7.0 -31.1 11.5 10.5 0.6 0.6 5.8 5.7

Pembangunan Perumahan PTPP 3,000 18,600 -0.7 0.0 0.7 -19.1 13.2 11.0 1.6 1.5 13.0 14.0

Pakuwon Jati PWON 680 32,749 0.0 -0.7 -2.2 19.3 16.7 14.8 3.1 2.6 19.1 18.3

Summarecon Agung SMRA 1,125 16,230 -0.4 -2.6 10.8 -20.8 56.3 36.8 2.3 2.2 4.5 5.9

Wijaya Karya WIKA 1,925 17,267 -0.8 -0.3 5.5 -23.3 14.1 11.7 1.3 1.2 9.8 10.8

Waskita Karya WSKT 2,900 39,364 0.0 2.5 11.5 12.4 11.7 10.3 2.4 2.0 22.7 21.2

MISCELLANEOUS

Astra International ASII 8,375 339,050 1.2 -0.9 2.4 3.7 17.4 15.6 2.7 2.4 15.9 15.9

Source: Bloomberg, Mirae Asset Sekuritas Indonesia

*Note: Valuation metrics based on Bloomberg consensus estimates

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Sector performance Top 10 market cap performance

Name Index Chg (%) Ticker Price Market Cap (IDRbn) Chg (%)

Agricultural 1,635.3 0.2 KRAS IJ 535 10,350 7.4

Mining 1,963.8 0.3 JKON IJ 530 8,644 6.0

Basic-Industry 734.6 1.2 PGAS IJ 2500 60,604 5.9

Miscellaneous Industry 1,395.5 1.1 TINS IJ 1070 7,969 4.9

Consumer Goods 2,857.4 0.2 BRPT IJ 2480 34,620 4.6

Property & Construction 535.4 0.5 ABMM IJ 2190 6,029 4.3

Infrastructure 1,163.7 0.5 PLIN IJ 3330 11,822 4.1

Finance 1,198.8 -0.2 KREN IJ 540 9,833 3.8

Trade 949.8 0.0 SIDO IJ 685 10,275 3.8

Composite 6,594.4 0.2 GIAA IJ 330 8,543 3.8

Source: Bloomberg

Top 5 leading movers Top 5 lagging movers

Name Chg (%) Close Name Chg (%) Close

ASII IJ 1.2 8,375 UNVR IJ -0.8 54,500

HMSP IJ 0.6 4,880 BBRI IJ -0.5 3,860

PGAS IJ 5.9 2,500 BBCA IJ -0.4 23,700

SMGR IJ 3.1 10,850 LPPF IJ -2.8 10,375

INKP IJ 3.7 8,450 PNBN IJ -2.5 1,390

Source: Bloomberg

Economic Calendar

Time Currency Detail Forecast Previous

6:50am JPY Core Machinery Orders m/m -1.9% 5.7%

7:00am AUD MI Inflation Expectations 3.7%

All Day CNY Bank Holiday

7:30am AUD Employment Change 15.3K 34.7K

7:30am AUD Unemployment Rate 5.5% 5.5%

11:30am JPY Revised Industrial Production m/m 2.7% 2.7%

4:00pm EUR Italian Trade Balance 4.44B 4.83B

5:00pm EUR Trade Balance 22.4B 22.5B

Tentative EUR Spanish 10-y Bond Auction 1.53|1.8

8:30pm CAD ADP Non-Farm Employment Change -7.1K

8:30pm USD PPI m/m 0.4% -0.1%

8:30pm USD Core PPI m/m 0.2% -0.1%

8:30pm USD Empire State Manufacturing Index 17.7 17.7

8:30pm USD Philly Fed Manufacturing Index 21.5 22.2

8:30pm USD Unemployment Claims 229K 221K

9:15pm USD Capacity Utilization Rate 78.0% 77.9%

9:15pm USD Industrial Production m/m 0.2% 0.9%

10:00pm USD NAHB Housing Market Index 72 72

10:30pm USD Natural Gas Storage -193B -119B

Note: Time is based on Indonesian local time Source: Forex Factory

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Mirae Asset Sekuritas Indonesia 7 Disclaimers

This report is prepared strictly for private circulation only to clients of PT Mirae Asset Sekuritas Indonesia (MASI). It is purposed only to person having professional experience in matters relating to investments. The information contained in this report has been taken from sources which we deem reliable. No warranty (express or implied) is made to the accuracy or completeness of the information. All opinions and estimates included in this report constitute our judgments as of this date, without regards to its fairness, and are subject to change without notice. However, none of MASI and/or its affiliated companies and/or their respective employees and/or agents makes any representation or warranty (express or implied) or accepts any responsibility or liability as to, or in relation to, the accuracy or completeness of the information and opinions contained in this report or as to any information contained in this report or any other such information or opinions remaining unchanged after the issue thereof. We expressly disclaim any responsibility or liability (express or implied) of MASI, its affiliated companies and their respective employees and agents whatsoever and howsoever arising (including, without limitation for any claims, proceedings, action, suits, losses, expenses, damages or costs) which may be brought against or suffered by any person as a results of acting in reliance upon the whole or any part of the contents of this report and neither MASI, its affiliated companies or their respective employees or agents accepts liability for any errors, omissions or misstatements, negligent or otherwise, in the report and any liability in respect of the report or any inaccuracy therein or omission there from which might otherwise arise is hereby expresses disclaimed.

This document is not an offer to sell or a solicitation to buy any securities. This firms and its affiliates and their officers and employees may have a position, make markets, act as principal or engage in transaction in securities or related investments of any company mentioned herein, may perform services for or solicit business from any company mentioned herein, and may have acted upon or used any of the recommendations herein before they have been provided to you. © PT Mirae Asset Sekuritas Indonesia 2016.