Tu na s Ba r u La m pu ng
sugar deficit widened significant ly as dom est ic dem and out st ripped
product ion wit h sugarcane plant ing areas experiencing only 1.1% CAGR in
1980- 2015. Furt herm ore, product ivit y was low averaging 5.6 t ons/ ha,
im plying t he absence of sizeable invest m ent s wit hin t he local sugar indust ry.
Subst a n t ia l t im e r e quir e d t o cr e a t e a se lf- sufficie nt indust r y :
The
governm ent aim s for I ndonesia t o achieve sugar self- sufficiency by 2019.
However, on lim it ed land availabilit y and m assive invest m ent requirem ent of
I DR82t n ( exhibit 22) , t his sugar self- sufficiency plan is unlikely t o be realized
given t he required addit ional plant ing areas of 486k ha, even higher t han t he
current plant ed area of 456k ha. Hence, we expect t he sugar deficit t o
persist over t he long t erm , allowing bot h im port ers and plant ers like TBLA t o
benefit from cont inued undersupply condit ions.
Lik e ly t o book st r on g gr ow t h on indust r y ine fficie ncy :
I n an effort t o
prot ect farm ers and encourage local players t o ent er t he sugar business, t he
governm ent has set t he sugar floor price at alm ost t wice t hat of t he
int ernat ional raw sugar price ( exhibit 23) . I ndonesia’s sugar floor price refers
t o farm ers’ cost of product ion as est im at ed by t he Agricult ure Minist ry.
We now expect higher sust ainabilit y for TBLA’s sugar refinery and sugar m ill
businesses. Based on t he governm ent ’s recent discussions t o allow refined
sugar t o be sold at t he ret ail level, coupled wit h plans t o prohibit im port ers
lacking sugarcane plant at ions from obt aining im port perm it s, we believe TBLA’s
sugar refinery business t o be m ore sust ainable, booking 2017F earnings of
I DR214bn, 24% of t he t ot al. As such, we now raise our t arget PE for t he sugar
refinery business from 1x t o 2.5x, st ill a 50% discount t o t he regional pure
refinery player. This gives a higher 12M SOTP- based TP of I DR1,470 ( exhibit
46) , reflect ing 46% upside pot ent ial. Wit h t his and t he posit ive sent im ent from
TBLA’s CPO segm ent wit h a higher average 2017F CPO price of USD750/ m t
( 2016: USD625/ m t ) , t he st ock’s st rong m arket out perform ance ( exhibit 4) is
likely t o persist . BUY. Risk s: Delays in t he com plet ion of TBLA’s sugar m ills as
well as policy risks st em m ing from lower im port quot as and sugar price ceiling.
Ex hibit 1 . Com pa n y inf orm a t ion Source: Bloom berg, Bahana est im at es
Not e: Pricing as of close on 7 Oct ober 2016
TBLA SI MP ANJT Sect or LSI P SGRO AALI DSNG ( % ) ( % )
Source: Bloom berg, Bahana
SUGAR I N D USTRY OVERVI EW
Ex hibit 6 . I ndone sia ’s 5 la r ge st suga r - pr odu cing pr ov ince s, 2 0 1 5
Ex hibit 7 . Su ga r ca ne pla nt a t ion a r e a m a p, 2 0 1 5
There are current ly 9 sugar- producing regions in I ndonesia ( exhibit 7) : Nort h
Sum at era, Sout h Sum at era, Lam pung, West Java, Cent ral Java, Jogj akart a, East Java,
Goront alo and Sout h Sulawesi. East Java was t he largest sugar- producing province in
t he count ry as of 2015, w it h product ion of 1.24m n t ons or around 50% of t ot al sugar
product ion. East Java had t he largest sugarcane plant ed area of 207k ha as of 2015.
Lam pung was t he second- largest sugar producer, wit h 757k t ons of sugar product ion
and a t ot al plant ed area of 125k ha. From a t ot al sugarcane plant at ion area of 456k ha,
I ndonesia produced around 2.5m n t ons of sugar for bot h dom est ic and overseas
consum pt ion.
9 suga r - pr oducing r e gions in
I ndone sia ge ne r a t e d 2 .5 m n
t on s of suga r a s of 2 0 1 5
Sour ce: I n donesia St at ist ics Agen cy
Ea st Ja v a w a s t he la r ge st
suga r - pr oducing pr ov in ce …
Sour ce: I n donesia St at ist ics Agen cy
… suppor t e d by t he la r ge st
pla nt a t ion a r e a of 2 0 7 k ha
I ndonesia’s sugar indust ry developm ent has occurred at a slow pace. During t he past
35 years, dom est ic sugar product ion only saw a 2% CAGR, from 1.3m n t ons in 1980 t o
2.5m n t ons in 2015 ( exhibit 8) . Slow dom est ic sugar product ion growt h occurred
m ainly due t o low growt h in sugarcane plant ed area developm ent , which only saw a
1.1% CAGR, from 316k ha in 1980 t o 456k ha in 2015. Moreover, sugarcane
product ivit y yields in I ndonesia have not seen m uch im provem ent during t his t im e. The
product ivit y yield was only at 5.6t ons/ ha as of 2015 ( exhibit 9) , im plying inefficiencies
in t he sugar product ion process. These t wo fact ors have result ed in low sugar
Ex hibit 1 1 . Su ga r ca ne pr oduct iv it y y ie ld br e a k dow n by ow ne r ship, 1 9 8 0 - 2 0 1 5
Ex hibit 1 2 . Su ga r pr odu ct ion cost , TBLA v e r su s indust r y , 2 0 1 5
Sour ce: I ndonesia St at ist ics Agency, Bahana
Pr iv a t e se ct or fe a t ur e s
highe r pr oduct iv it y y ie ld …
Privat e plant at ions, which cont ribut ed 30% of I ndonesia’s overall plant at ion area as of
2015, have t he highest product ivit y yields ( exhibit 11) com pared t o t he governm ent
and sm allholdings, at 5.9 t ons/ ha, wit h t he sm allholdings yield at 5.3 t ons/ ha and t he
governm ent ’s yield at only 4.5 t ons/ ha. We t hink t his im plies t hat t he governm ent has
not invest ed in t he sugar indust ry sufficient ly t o increase product ivit y. Furt herm ore,
underinvest m ent has creat ed inefficiency, which has result ed in high product ion cost s.
On average, t he I ndonesia sugar indust ry, represent ed by Perkebunan Nusant ara
( PTPN) as st at e- owned sugar producers, had an average product ion cost at
I DR6,022/ kg in 2015 while privat e plant at ions such as TBLA had 27% lower product ion
cost s of I DR4,402/ kg due t o higher plant at ion yields and ext ract ion rat es.
… a t 5 .9 t on s/ ha w hile
gov e r nm e nt pla nt a t ion y ie ld
is only 4 .5 t on s/ ha
4,402
6,022
3,500 4,000 4,500 5,000 5,500 6,000 6,500
TBLA I ndust r y
( I DR/ k g)
Sour ce: Bahana, Com pan y
TBLA’s pr odu ct ion cost w a s
2 7 % low e r t ha n t he
indust r y ’s in 2 0 1 5
Problem s in developing sugarcane plant at ion areas arise from difficult ies in finding a
suit able region, as t he plant at ion area needs t o be close t o t he sugar m ill t o preserve
t he sugarcane from det eriorat ion. As of 2015, 57 out of 69 sugar m ills in operat ion
were concent rat ed in t he Java region ( exhibit 13) , where no available land was left t o
increase t he sugarcane plant at ion area. I n addit ion, I ndonesia has suffered from low
ext ract ion rat es as m ost sugar m ills use obsolet e t echnology. Of t he 69 m ills, a t ot al of
47 sugar m ills, cont ribut ing 61% of t ot al m illing capacit y ( exhibit 15) , were built during
Dut ch colonial t im es ( exhibit 14) and have not m ade t echnological im provem ent s t o
increase product ivit y.
Ex hibit 1 3 . Su ga r m ill loca t ions
Ex hibit 1 4 . W a t oe t oe lis suga r m ill pla nt , Ea st Ja v a
Ex hibit 1 5 . I n done sia su ga r m ills: a ge a nd m illing ca pa cit y br e a k dow n , 2 0 1 5
2
1 4
8 15 1 33
1
1
3
Num ber of sugar m ill w it hin t he r egion
Sour ce: Bahana
5 7 out of 6 9 suga r m ills a r e
loca t e d in t he Ja v a r e gion
Sour ce: Bahana
St a t e - ow ne d
PTPN ’s
W a t oe t oe lis su ga r m ill w a s
built in 1 8 3 9 a nd st ill
ope r a t e s w it h out a ny m a j or
cha n ge s t o im pr ov e
e fficie ncy
Age
( ye a r s)
N u m b e r of
pla n t s
Pe r ce n t a ge
( % )
M illin g ca p a cit y
( t cd)
0- 25
5
7.2
29,928
26- 50
14
20.3
43,195
50- 100
3
4.3
9,256
> 100
47
68.1
130,510
Tot a l
6 9
1 0 0
2 1 2 ,8 8 8
Sour ce: Bahana
Ex hibit 1 6 . Globa l su ga r consum pt ion pe r ca pit a , 2 0 1 5
Ex hibit 1 7 . I n done sia su ga r pr oduct ion a nd consum pt ion, 1 9 9 7 - 2 0 1 5
55
39
38
37
34
33
23 23
21
12
0 10 20 30 40 50 60
Br azil Russia Mex ico EU Egypt US Pak ist an I ndonesia I ndia China ( k g/ capit a)
Sour ce: USDA, Bahana
I ndone sia
ha s t he 8 t h
la r ge st
pe r ca pit a
suga r
consum pt ion in t he w or ld
3.1 3.1 3.3
3.5 3.6 3.7 3.8
3.9 3.9
4.3 4.5
5.1 5.3
5.5 5.6 5.6 5.8
6.2 6.5
2.2
1.5 1.5 1.7 1.7 1.8 1.6
2.1 2.2 2.1
2.6 2.6
2.3 2.3 2.2
2.6 2.6 2.6 2.5
0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Consum pt ion Pr oduct ion ( m n t ons)
Sour ce: Bloom ber g, Bahana
Suga r de ficit due t o lim it e d
de v e lopm e nt of suga r
pr oduct ion
out pa ce d by
consum pt ion gr ow t h
On t he ot her hand, I ndonesia is one of 10 count ries wit h t he highest sugar
consum pt ion at 23 kg/ capit a in 2015 ( exhibit 16) . Dom est ic sugar consum pt ion
doubled from 3.1m n t ons in 1997 t o 6.5m n t ons, for an 18- year CAGR of 10.1% . The
rapid growt h of sugar consum pt ion, which has out paced t he lim it ed developm ent of
sugar product ion, has creat ed a st ruct ural deficit in I ndonesia’s sugar indust ry. The
deficit has worsened over t im e from 850k t ons in 19 97 t o 4m n t ons in 2015, creat ing a
significant gap ( exhibit 17) . The prolonged undersupply condit ions in t he sugar m arket
also have driven t he average ret ail price from I DR10,400/ kg in June 2011 t o as high as
I DR16,200/ kg in July 2016 ( exhibit 18) .
Ex hibit 1 8 . I n done sia ’s suga r r e t a il pr ice a nd floor pr ice , Ja n 2 0 1 1 - Aug 2 0 1 6
Av erage r et ail price Floor pr ice ( I DR/ k g)
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 ( m n t ons)
Sour ce: I ndonesia St at ist ics Agency
Ex hibit 2 1 . List of su ga r r e fining com pa nie s in I ndone sia
Ex hibit 2 2 . Tot a l inv e st m e nt r e quir e d in 2 0 1 7 F, w or st , ba se a n d be st sce na r ios
I ndonesia relies heavily on sugar im port s ( exhibit 20) t o fulfil t he dom est ic dem and
and t o cont rol t he m ark et price am id sugar short ages. As st ipulat ed under Law
no.117/ 2015, privat e players can im port raw sugar and refined sugar aft er obt aining
approval from Trade Minist ry, while only SOEs can im port whit e sugar. Raw sugar,
m ainly im port ed from Brazil, I ndia, China and Thailand, is used as a raw m at erial t o
produce refined sugar for t he F&B indust ry ( ex hibit 19) . The Governm ent also
m aint ains im port quot as t o develop t he dom est ic sugar indust ry and at t ain
self-sufficiency in sugar product ion. The quot a is shared by I ndonesia’s 8 sugar refining
com panies wit h a t ot al product ion capacit y of 3.6m n t ons, and Wilm ar group dom inat es
t he quot a wit h 960k t ons, or 27% of t he t ot al capacit y. TBLA obt ained 262k t on of t he
sugar im port quot a in 2016.
Pr iv a t e pla y e r s ca n only
im por t r a w su ga r a nd
r e fine d suga r pr oduct s
Com pa n y
Loca t ion
Ye a r
e st a blish e d
Tot a l
ca pa cit y
( t ons)
PT Angels Product s
Ser ang, Bant en
1996
500,000
PT Jaw am anis Rafinasi ( Wilm ar )
Cilegon, Bant en
2002
160,000
PT Sent r a Usahat am a Jay a
Cilegon, Bant en
2004
540,000
PT Per m at a Dunia Sukses Ut am a
Cigading, Bant en
2005
390,000
PT Dut a Sugar I nt er nat ional ( Wilm ar )
Cilegon, Bant en
2005
800,000
PT Dhar m apala Usaha Sukses
Cilacap, Cent r al Jav a
2007
250,000
PT Sugar Labint a
Sout h Lam pung
2007
540,000
PT Mak assar Tene
Sout h Sulaw esi
2009
200,000
TBLA
Lam pung
2014
212,000
Tot a l
3 ,5 9 2 ,0 0 0
Sour ce: Bahana
W ilm a r gr oup dom ina t e d t he
suga r r e fining indust r y ,
a ccou nt ing for 2 7 % of t ot a l
indust r y ca pa cit y
D e t a ils
W or st
Ba se
Be st
Sugar consum pt ion ( t ons)
6,976,326
6,976,326
6,976,326
Ex ist ing plant at ion ar ea ( ha)
464,981
464,981
464,981
Ex ist ing plant at ions y ield ( t ons/ ha)
80
80
90
Ex ist ing sugar ex t r act ion r at e ( % )
7
7
10
Ex ist ing sugar product ion ( t ons)
2,629,932
2,603,893
4,184,829
Sugar deficit ( t ons)
4,346,394
4,372,433
2,791,498
New plant at ion y ield ( t ons/ ha)
80
90
90
New ex tr act ion r at e ( % )
7
10
10
Addit ion a l pla nt a t ion a r e a r e qu ir e d ( ha )
7 7 6 ,1 4 2
4 8 5 ,8 2 6
3 1 0 ,1 6 6
Addit ional sugar m ill plant needed ( unit s)
37
37
24
Av g. land cost ( I DRm n/ ha)
20
20
20
Av g. m aint enance cost ( I DRm n/ ha)
25
25
25
Sugar m ill capacit y ( t ons)
120,000
120,000
120,000
Sugar m ill capex ( I DRbn)
1,300
1,300
1,300
Tot al land acquir ing cost needed ( I DRbn)
15,522.84
9,716.52
6,203.33
Tot al m aint enance cost needed ( I DRbn)
31,028.07
23,770.17
19,378.68
Tot al sugar m ill capex needed ( I DRbn)
48,100
48,100
31,200
Tot a l cost ( I D Rbn )
9 4 ,6 5 1
8 1 ,5 8 7
5 6 ,7 8 2
Sour ce: Bahana est im at esEx hibit 2 3 . Ra w suga r pr ice a nd I ndone sia ’s suga r floor pr ice , Ja n 0 4 - Se p 1 6
Minist erial Decree no.527/ 2004 for sugar im port s t o prot ect farm ers from low selling
prices and t o encourage local players in plant ing sugarcane. I ndonesia’s sugar floor
prices are aligned wit h farm ers’ cost of product ion est im at ed by t he Agricult ure Minist ry
( exhibit 24) . Declining yields and increases in land rent al cost s, which cont ribut ed
c.30% of t he t ot al product ion cost , were t he m ain drivers for farm ers’ increase in t he
cost of product ion. Moreover, t he sugar floor price also m oved in line wit h t he increase
in PTPN’s COGS. We believe TBLA, wit h a lower product ion cost com pared t o farm ers’
and PTPN’s product ion cost , is likely t o enj oy supernorm al profit s, w hile t he
inefficiencies in sugar indust ry are being addressed.
… t o pr ot e ct fa r m e r s fr om
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Floor pr ice Farm ers' product ion cost
( I DR/ k g)
Sour ce: Bahana, Agr icult ur e Minist r y
Ex hibit 2 5 . PTPN ’s COGS a nd su ga r floor pr ice , 2 0 1 0 - 2 0 1 5
Sour ce: I ndonesia St at ist ics Agency, Bahana
La nd r e nt a l cost a ccoun t s for
2007 2008 2009 2010 2011 2012 2013 2014 2015
Thailand Philippine I ndonesia Aust ralia Br azil ( RHS)
( m n t ons) ( m n t ons)
Sour ce: I ndonesia St at ist ics Agency, FAO, Bahana
Ex hibit 2 8 . Top 5 su ga r - pr oducin g cou nt r ie s, 2 0 0 5 - 2 0 1 4
Ex hibit 2 9 . W or ld pr odu ct iv it y yie ld, 2 0 1 5
Ex hibit 3 0 . La m pun g r a infa ll da t a , 2 0 0 6 - August 2 0 1 6
10 20 30 40 50 60 70 80
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Br azil I ndia China Thailand Pak ist an ( m n t ons)
Sour ce: Bloom ber g
… a nd pr oduce d 7 3 m n t on s
or 4 2 % of globa l pr odu ct ion
0 5 10 15 20 25 30
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Br azil Thailand I ndonesia Aust ralia ( t ons/ ha)
Sour ce: USDA, Bloom ber g, Bahan a
Aust r a lia ha d m uch h ighe r
pr oduct iv it y y ie ld com pa r e d
t o I ndone sia , giv e n sim ila r
pla nt a t ion a r e a a t c.4 0 0 k ha
0 50 100 150 200 250 300 350 400 450 500
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Max Min Mean 2016
( m m )
Sour ce: Bahana
Ex hibit 3 1 . Pr odu ct ion cost com pa r ison
Ex hibit 3 2 . List of upcom ing su ga r m ill inv e st m e nt s in I ndone sia
Ex hibit 3 3 . TBLA’s pa lm pla nt a t ion a r e a & a v e r a ge y ie ld, 2 0 1 3 - 2 0 1 8 F
( I D R/ k g)
TBLA' s w h it e
su g a r
TBLA' s r e fin e d
su g a r
PTPN ' s w h it e
su g a r
Raw m at erial
cost
-
5,000
-
Maint enance
cost
2,402
2,709
Product ion cost
2,000
100
3,313
I m port dut y
-
550
-
COGS
4 ,4 0 2
5 ,6 5 0
6 ,0 2 2
Sour ce: Com pany, Bahana
TBLA’s pr oduct ion cost for
w hit e suga r is 2 2 % che a pe r
t ha n it s r e fine d pr odu ct , or
2 7 % com pa r e d t o PTPN ’s
Com p a n y
Loca t ion
Su g a r m ill
ca p a cit y ( t on s)
CPI N, Dj arum and
Wings group
Sum ba, East Nusa Tenggara
150,000
Sout h Sum at era
150,000
Wilm ar group
Manggarai, East Nusa Tenggara
150,000
MEDC
Papua
n/ a
Sour ce: Bahana, Bisnis.com
Se v e r a l I ndone sia n
conglom e r a t e s
a r e
r e por t e dly pla nning t o e nt e r
t he suga r bu sine ss
56,474
53,751
52,895
53,258
53,758
54,158
9 10 11 12 13 14 15 16 17
51,000 52,000 53,000 54,000 55,000 56,000 57,000
2013 2014 2015 2016F 2017F 2018F
Palm plant ed area Av erage y ield ( RHS)
( ha) ( t ons/ ha)
Sour ce: Com pany, Bahana
Ex hibit 3 4 . TBLA r e v e nu e cont r ibu t ion pe r se gm e nt , 2 0 1 4 - 2 0 1 8 F
Ex hibit 3 7 . TBLA’s suga r ca ne pla nt a t ion in Te r ba nggi, La m pun g
Ex hibit 3 8 . TBLA’s suga r ca ne pla nt a t ion, m ill & r e fine r y loca t ion
Ex hibit 3 9 . TBLA’s se a por t a t W a y Lunik , La m pung
Sour ce: Bahana
Suga r ca ne
w a s
be ing
ha r v e st e d, w hile w e v isit e d
Sour ce: Com pany
The
1 2 0 k - t on
suga r m ill
pla nt is st r a t e gica lly loca t e d
w it hin t he com pa ny ’s
suga r ca ne pla n t a t ion a r e a
Sour ce: Com pany
Ex hibit 4 0 . TBLA’s suga r m ill pla nt is ne a r com ple t ion
Ex hibit 4 1 . I n side t he suga r m ill pla nt
Ex hibit 4 2 . Va cuu m boile r s
Sour ce: Bahana
The su ga r m ill pla nt w ill
com m e nce it s ope r a t ion in
e a r ly 2 0 1 7 , …
Sour ce: Bahana
… fe a t ur ing 5 - st a ge m illing
pr oce ss …
Sour ce: Bahana
… a nd v a cuum boile r s t o
suppor t
high suga r
Ex hibit 4 3 . TBLA’s suga r r e fine r y pla nt
Ex hibit 4 4 . TBLA’s im por t e d r a w suga r inv e nt or y
Ex hibit 4 5 . I m por t e d r a w suga r , be for e a n d a ft e r r e fining pr oce ss
Sour ce: Bahana
Suga r r e fine r y w it h
pr oduct ion ca pa cit y of 2 1 6 k
t on s p.a .
Sour ce: Bahana
2 0 k t on s of r a w suga r
im por t e d fr om Br a z il
Sour ce: Bahana
Ex hibit 4 6 . Su m - of- t he - pa r t s v a lua t ion
Se gm e n t s
N e t pr of it ( I D Rbn )
M e t h od
Va lu e
Palm oil business
409.9
2017F PE of 9.0x
3,689
Sugar m ill business
267.3
2017F PE of 13.5x
3,608
Sugar r efinery business
213.9
2017F PE of 2.5x
214
Tot al value ( I DRbn)
7,833
Shares out st anding ( m n)
5,342
Va lu e / Sh a r e ( I D R)
1 ,4 7 0
Sour ce: Bahana for ecast s
Ex hibit 4 7 . Pe e r s com pa r ison, 2 0 1 6 F- 2 0 1 7 F
Ma r k e t ca p
( USDb ) 2 0 1 6 F 2 0 1 7 F 2 0 1 6 F 2 0 1 7 F 2 0 1 6 F 2 0 1 7 F 2 0 1 6 F 2 0 1 7 F 2 0 1 6 F 2 0 1 7 F
CPO b u sin e ss 3 1 .3 2 7 .1 2 2 .1 2 .6 2 .3 1 6 .0 1 4 .0 2 .3 2 .7 9 .9 1 0 .5
ASTRA AGRO LESTARI TBK PT 2.3 18.8 15.4 1.8 1.7 10.4 8.6 1.8 2.5 10.5 11.6 SALI M I VOMAS PRATAMA TBK PT 0.6 17.3 12.9 0.5 0.5 6.5 5.7 2.1 2.5 2.9 3.8
SAMPOERNA AGRO TBK PT 0.3 14.5 11.7 1.1 1.0 9.4 6.8 1.2 1.8 7.6 9.3
TUNAS BARU LAMPUNG TBK PT 0.4 8.1 6.1 1.3 1.4 9.4 6.3 3.7 7.0 16.4 25.6 PP LONDON SUMATRA I NDONES PT 0.8 19.9 14.2 1.4 1.3 9.9 7.6 2.0 2.2 6.7 9.0
SI ME DARBY BERHAD 12.0 31.2 22.9 1.6 1.5 16.1 14.0 2.6 3.1 5.3 6.7
I OI CORP BHD 6.7 26.2 24.8 5.3 4.1 19.2 16.9 2.2 2.4 18.9 16.7
KUALA LUMPUR KEPONG BHD 6.2 24.4 22.5 2.5 2.4 15.2 14.3 2.4 2.5 11.2 11.9
GENTI NG PLANTATI ONS BHD 2.0 34.0 25.1 1.9 1.8 20.9 16.6 0.7 0.9 5.3 7.0
Su g a r m ill b u sin e ss 2 .3 9 3 .0 2 2 .9 2 .8 2 .5 7 .2 6 .0 2 .0 2 .3 5 .7 9 .6
KHON KAEN SUGAR I NDUSTRY PCL 0.5 20.6 16.5 1.3 1.2 12.7 11.4 3.2 4.4 5.5 7.9
BURI RAM SUGAR PCL 0.2 22.2 18.2 3.6 3.4 21.5 14.0 1.7 2.1 16.4 17.8
NANNI NG SUGAR I NDUSTRY CO - A 1.1 175.8 30.3 4.6 4.0 na na na na 5.9 12.7
ROGERS SUGAR I NC 0.5 14.8 15.1 na na 10.9 9.9 5.5 5.5 na na
Su g a r r e f in e r y b u sin e ss 0 .2 6 .0 5 .0 1 .2 1 .1 2 .3 2 .0 9 .1 1 1 .2 1 9 .9 1 8 .3
DANGOTE SUGAR REFI NERY PLC 0.2 6.0 5.0 1.2 1.1 2.3 2.0 9.1 11.2 19.9 18.3
W e ig h t e d Av e r a g e 3 3 .8 1 2 6 .1 5 0 .0 6 .5 5 .8 2 5 .5 2 1 .9 1 3 .3 1 6 .2 3 5 .5 3 8 .4
PER ( x ) PBV ( x ) EV/ EBI T DA ( x ) Div . y ie ld ( % ) ROE ( % )
Alv in Gu n a w a n Macro & Fixed I ncom e Associat e
This publicat ion is pr epar ed by PT.Bahana Secur it ies and r ev iewed by Daiwa Secur it ies Gr oup I nc. an d/ or it s affiliat es, and dist r ibut ed out side I ndonesia by
Wit hin t he preceding 12 m ont hs, The subsidiar ies and/ or affiliat es of Daiwa Secur it ies Group I nc. * has lead- m anaged public offer ings and/ or secondar y offer ings ( excluding st raight bonds) of t he secur it ies of t he following com panies: China Reinsur ance Gr oup Corporat ion ( 1508 HK) .
* Subsidiar ies of Daiwa Secur it ies Gr oup I nc. for t he pur poses of t h is sect ion shall m ean any one or m or e of:
htt ps: / / daiwa3.bluem atrix.com / sellside/ Disclosures.action.
Ther e is no m at er ial disciplinar y act ion against Daiwa I n dia by an y r egu lat or y aut h or it y im pact ing equit y r esear ch analy sis act iv it ies as of t he dat e of t h is r epor t .
St ock r at in gs ar e based on absolut e upside or downside, wh ich is t he differ ence bet ween t he t ar get pr ice and t he cur r ent m ar ket pr ice. Un less ot her w ise specified, t hese r at ings ar e set w it h a 12- m ont h h or izon. I t is possible t hat fut ur e pr ice volat ilit y m ay cause a t em por ar y m ism at ch bet w een upside/ down side for a st ock based on t he m ar ket pr ice and t he for m al r at ing.
" Buy" : t he pr ice of t he secur it y is expect ed t o in cr ease by 10 % or m or e.
" Hold" : t he pr ice of t he secur it y is expect ed t o r ange fr om an in cr ease of less t han 10 % t o a decline of less t han 5% . " Reduce" : t he pr ice of t he secur it y is expect ed t o decline by 5 % or m or e.
Sect or r at in gs ar e based on fun dam ent als for t he sect or as a whole. Hence, a sect or m ay be r at ed “ Over weight ” even t hou gh it s const it uent st ock s ar e all r at ed “ Reduce” ; and a sect or m ay be r at ed “ Under weight ” even t hou gh it s con st it uent st ocks ar e all r at ed “ Buy” .
“ Over weight ” : posit ive fundam ent als for t he sect or .
“ Neut r al” : neit her posit ive n or negat ive fun dam ent als for t he sect or . “ Under weight ” : negat ive fundam ent als for t he sect or .
Owner sh ip of Secur it ies
For “ Owner sh ip of Secur it ies” in for m at ion, please v isit BlueMat r ix disclosur e Link at ht t ps: / / daiw a3.blu em at r ix. com / sellside/ Disclosur es.act ion . I nvest m ent Ban k ing Relat ionsh ips
For “ I nvest m ent Ban k ing Relat ionship” , please v isit BlueMat r ix disclosur e Link at ht t ps: / / daiwa3.bluem at r ix .com / sellside/ Disclosur es.act ion .
Relevant Relat ionsh ips ( Bahana Secur it ies)
Bahana Secur it ies m ay fr om t im e t o t im e have an indiv idual em ploy ed by or associat ed w it h it ser ves as an officer of an y of t he com pan ies under it s r esear ch cover age.
Bahana Secur it ies m ar ket m ak ing
Bahana Secur it ies m ay fr om t im e t o t im e m ake a m ar ket in secur it ies cover ed by t h is r esear ch.
St a nda r d & Poor ’s
The N a m e of t he Cr e dit Ra t ing Ag e ncie s g r oup, e t c.
The nam e of t he Cr edit Rat ing Agencies gr oup: S&P Global Rat ings ( " St andar d & Poor ’s " ) The nam e and r egist r at ion nu m ber of t he Regist er ed Cr edit Rat ing Agency in t he gr oup: St andar d & Poor ’s Rat ings Japan K.K. ( FSA com m issioner ( Rat in g) No.5)
H ow t o a cquir e in for m a t ion r e la t e d t o a n out line of t he r a t ing policie s a nd m e t hod s a d op t e d by t he pe r son w ho de t e r m ine s Cr e d it Ra t ings The infor m at ion is post ed under “ Unr egist er ed Rat in g I n for m at ion” (ht t p: / / w ww. st andar dan dpoor s.co.j p/ unr egist er ed) in t he “ Libr ar y and Regu lat ions” sect ion on t he websit e of St andar d & Poor ’s r at ings Japan K.K. (ht t p: / / ww w. st andar dan dpoor s. co.j p)
Assu m pt ions, Significa n ce a nd Lim it a t ion s of Cr e dit Ra t ings
Cr edit r at ings assigned by St andar d & Poor 's ar e st at em ent s of opin ion on t he fut ur e cr edit qualit y of specific issuer s or issues as of t he dat e t hey ar e expr essed and t hey ar e n ot index es wh ich sh ow t he pr obabilit y of t he occur r ence of t he failur e t o pay by t he issuer or a specific debt and do not guar ant ee cr edit w or t hiness. Cr edit r at ings ar e not a r ecom m endat ion t o pur chase, sell or hold an y secur it ies, or a st at em ent of m ar ket liqu idit y or pr ices in t he secondar y m ar ket of an y issues.
Cr edit r at ings m ay change depending on var ious fact or s, inclu ding issuer s' per for m ance, changes in ex t er nal env ir on m ent , per for m ance of under ly ing asset s, cr edit w or t hiness of count er par t ies and ot her s. St andar d & Poor 's conduct s r at ing analy sis based on infor m at ion it believes t o be pr ov ided by t he r eliable sour ce and assign s cr edit r at ings only when it believes t her e is enough in for m at ion in t er m s of qualit y and quant it y t o m ake a conclusion. However , St andar d & Poor 's does not per for m an audit , due diligence or in dependent ver ificat ion of any infor m at ion it r eceives fr om t he issuer or a t h ir d par t y, or guar ant ee it s accur acy, com plet eness or t im elin ess of t he r esu lt s by using t he in for m at ion. Mor eover , it needs t o be not ed t hat it m ay in cur a pot ent ial r isk due t o t he lim it at ion of t he h ist or ical dat a t hat ar e available for u se dependin g on t he r at ing.
This infor m at ion is based on infor m at ion Daiwa Secur it ies Co. Lt d. has r eceived fr om sour ces it believes t o be r eliable as of May 13t h, 2016, but it does not guar ant ee accur acy or com plet eness of t h is in for m at ion. For det ails, please r efer t o t he websit e of St andar d & Poor ’s Rat ings Japan K. K. (ht t p: / / w ww .st andar dandpoor s.co.j p)
Addit iona l in for m a t ion m a y be a v a ila ble upon r e que st .
Ja pa n - a ddit iona l not ifica t ion it e m s pur sua nt t o Ar t icle 3 7 of t he Fina ncia l I n st r u m e n t s a nd Ex cha nge La w ( This Not ificat ion is on ly applicable wher e r epor t is dist r ibut ed by Daiwa Secur it ies Co. Lt d.)
I f y ou decide t o ent er int o a bu sin ess ar r angem ent w it h us based on t he infor m at ion descr ibed in m at er ials pr esent ed along w it h t h is docum ent , we ask you t o pay close at t ent ion t o t he follow ing it em s.
• I n addit ion t o t he pur chase pr ice of a financial inst r u m ent , we w ill collect a t r adin g com m ission* for each t r ansact ion as agr eed befor ehand w it h you. Sin ce com m ission s m ay be included in t he pur chase pr ice or m ay not be char ged for cer t ain t r ansact ions, w e r ecom m end t hat you con fir m t h e com m ission for each t r ansact ion.
• I n som e cases, we m ay also char ge a m ax im u m of ¥ 2 m illion ( inclu din g t ax) per year as a st anding pr oxy fee for our deposit of y our secur it ies, if you ar e a non- r esident of Japan.
• For der ivat ive and m ar gin t r ansact ion s et c., we m ay r equ ir e collat er al or m ar gin r equ ir em ent s in accor dance w it h an agr eem ent m ade befor ehand w it h you. Or dinar ily in su ch cases, t he am ount of t he t r ansact ion w ill be in excess of t he r equ ir ed collat er al or m ar gin r equ ir em ent s.
• Ther e is a r isk t hat you w ill incur losses on y our t r ansact ions due t o changes in t he m ar ket pr ice of fin ancial inst r u m ent s based on fluct u at ion s in int er est r at es, exchan ge r at es, st ock pr ices, r eal est at e pr ices, com m odit y pr ices, and ot her s. I n addit ion, depending on t he cont ent of t he t r ansact ion, t he loss cou ld exceed t he am ount of t he collat er al or m ar gin r equir em ent s.
• Ther e m ay be a differ ence bet ween bid pr ice et c. an d ask pr ice et c. of OTC der ivat ives handled by u s.
• Befor e engaging in an y t r ading, please t hor ough ly con fir m account in g and t ax t r eat m ent s r egar ding y our t r ading in finan cial inst r u m ent s w it h such exper t s as cer t ified pu blic account ant s.
* The am ount of t he t r ading com m ission cannot be st at ed her e in advance because it w ill be det er m ined bet ween our com pan y an d you based on cur r ent m ar ket con dit ions and t he cont ent of each t r ansact ion et c.
When m ak ing an act ual t r ansact ion, please be sur e t o car efu lly r ead t he m at er ials pr esent ed t o y ou pr ior t o t he execut ion of agr eem ent , and t o t ake r esponsibilit y for y our own decisions r egar ding t he sign ing of t he agr eem ent w it h us.
Cor por at e Nam e: Daiwa Secur it ies Co. Lt d.
Financial in st r um ent s fir m : ch ief of Kant o Local Finance Bur eau ( Kin - sho) No.108 Mem ber sh ips: Japan Secur it ies Dealer s Associat ion, Financial Fut ur es Associat ion of Japan
