Indonesia Strategy

8 November 2024 Market Outlook | Market Strategy

Market Strategy
3Q24 Highlights: Solid Banks, Auto, Coal, Poultry Stocks Covered 76
Rating (Buy/Neutral/Sell): 53 / 20 / 3
Last 12m Earnings Revision Trend: Neutral
• 3Q24 net profit: Banks, auto, coal, and poultry posted strong Sectors Top Picks
performances; challenges persist in tobacco, healthcare, OVERWEIGHT
telecommunication, and cement. Overall, 3Q24 bottomline saw a 9.6% QoQ Banks BBRI, BBNI, BMRI,
rise (+11.6% YoY), with total 9M24 earnings up 4.1% YoY or 76% of forecasts, BBTN
ie aligning with expectations. These numbers are based on 9M24 earnings of Cement INTP
56 out of the 76 firms we cover. Post results, we adjusted earnings, raising Healthcare KLBF
projections for Astra International (ASII), United Tractors (UNTR), Aneka Oil & gas MEDC, ELSA
Tambang (ANTM IJ, BUY, TP: IDR1,800), Japfa Comfeed (JPFA IJ, BUY, TP: Property – industrial estates DMAS
IDR2,650), and PP London Sumatra Indonesia (LSIP IJ, BUY, TP: IDR1,400), Property – residential developer PWON, BSDE
thanks to strong performances and still-robust 4Q24 outlooks, while Telecommunication EXCL
lowering our forecast for Kencana Energi Lestari (KEEN IJ, BUY, TP: IDR850).
• Banks met expectations on strong loan growth and robust non-II. Banks like NEUTRAL
Bank Central Asia (BBCA IJ, BUY, TP: IDR12,060), Bank Mandiri (BMRI IJ,
Auto & autoparts ASII, AUTO
BUY, TP: IDR8100), and Bank Negara Indonesia (BBNI IJ, BUY, TP: IDR6,710)
Coal UNTR
saw improved asset quality and healthy loan yields. BBCA raised its FY24
loan growth target while Bank Rakyat Indonesia (BBRI) showed NIM and Consumer AMRT, ICBP
non-II growth. Bank BJB (BJBR IJ, NEUTRAL, TP: IDR920) faced challenges – Metal mining MDKA, INCO
affected by lower NIM; no thanks to higher Bank Indonesia (BI) rates. Plantation LSIP
• Auto & autoparts outperformed on strong demand for used vehicles and Poultry JPFA
replacement markets despite weak new vehicle sales. ASII’s earnings were Pulp & paper INKP
boosted by its mining, gold, and financial services segments while Astra Tobacco HMSP
Otoparts (AUTO) benefited from robust trading and manufacturing
recoveries. Both achieved c.85% of their FY24F earnings. Analyst
• Consumer had mixed results: Indofood CBP (ICBP) and Indofood Sukses
(INDF IJ, BUY, TP: IDR8,000) doing well on FX gains and solid demand. Firms Andrey Wijaya
like Mayora Indah (MYOR IJ, BUY, TP: IDR3,300) and Unilever Indonesia +6221 5093 9846
(UNVR IJ, NEUTRAL, TP: IDR2,170) saw challenges from rising material costs [email protected]
and increased competition. Healthcare and telecommunications
underperformed on lower patient volume and rising costs (healthcare) and
reduced data demand and subscriber growth (telecoms).
• Coal and oil & gas, robust commodity prices supported strong performance. Recently published strategy reports
UNTR and Adaro Energy (ADRO IJ, BUY, TP: IDR3,900) led coal while
● Unity, Self-Sufficiency, And Sustainable Growth
Perusahaan Gas Negara (PGAS IJ, NEUTRAL, TP: IDR1,440) and Medco
Energi Internasional (MEDC) showed resilience in oil & gas on higher ● Hopeful Despite Recent Volatility, 4Q24 Sector Picks
distribution spreads and improved associate income. Metal mining was ● IKN Progress, Fiscal Strategies, Retail Sector Insights
mixed: Vale Indonesia (INCO IJ, TRADING BUY, TP: IDR4,300) was ● Positive Market Outlook Driven By 2025 Budget
pressured by high energy costs while ANTM was propped by strong demand. ● Strong 1H24; Healthcare, Poultry, Auto Outperform
• Infrastructure, toll road, cement, and property development: Mixed results. ● Tactical Strategies During The Transition Period
Infrastructure showed YoY growth from tariff increases, though QoQ ● Post 1Q24 Earnings Tactical Strategy
earnings normalised due to seasonal factors. Cement faced challenges from
industry oversupply while property development saw revenue normalisation
after a strong first half, driven by recurring income from hospitality.

Target % Ups ide P/E (x) P/B (x) ROAE (%) Yield (%)
Company Name Rating
(IDR) (Downs ide) Dec-25F Dec-25F Dec-25F Dec-25F
Astra International Buy 6,300 22.9 5.8 1.1 18.1 5.0
Astra Otoparts Buy 2,800 13.4 7.1 0.8 11.6 4.4
Bank Rakyat Indonesia Buy 5,900 25.0 10.0 2.0 19.9 6.9
Elnusa Buy 650 38.3 4.1 0.6 15.9 9.1
Indofood CBP Buy 13,800 12.0 13.7 2.7 21.6 3.4
Kalbe Farma Buy 1,970 23.9 21.0 3.0 14.5 2.5
Medco Energi Internasional Buy 1,900 49.0 5.1 0.8 18.2 5.5
Merdeka Copper Gold Buy 3,100 33.6 37.1 3.3 9.2 -
S umber Alfaria Trijaya Buy 3,800 15.5 39.7 6.9 25.0 -
United Tractors Buy 35,000 28.0 5.3 1.1 20.9 7.6
Source: Company data, RHB P/E (x) P/B (x) ROAE Yield (%)
Dec-25F
5.8 Dec-25F
1.1 (%)0.2 Dec-25F
0.0
See important disclosures at the end of this report
1
7.1 0.8 0.1 0.0
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

3Q24: Solid banking, automotive, coal; challenges in tobacco, cement

In summary, 3Q24 saw solid performances from sectors like banks, automotive, coal, and
poultry. Meanwhile, tobacco, healthcare, telecom, and cement underperformed due to
industry-specific challenges. Overall, 3Q24 net profit demonstrated 9.6% QoQ and 11.6%
YoY increases. Total 9M24 earnings increased 4.1% YoY, achieving 76% and 75% of our and
consensus’ FY24 earnings forecasts, aligning with general expectations. The figures above are
based on 9M24 earnings reports from 56 out of the 76 companies within our coverage.
Following the 3Q24 results announcement, we revised our earnings estimates, increasing
projections for ASII, UNTR, ANTM, JPFA, and LSIP due to their strong performances and
positive 4Q24 outlooks, while reducing the forecast for KEEN.
Banks performed steadily, meeting expectations with strong loan growth and robust non-
interest income. BBCA increased its FY24 loan growth target to 10-12% despite expecting
higher opex in 4Q24. BMRI saw an improvement in NIM on a consolidated basis, though bank-
only NIM was impacted by funding costs. BBNI benefited from higher loan yields and a focus
on low-cost deposits, while BBRI’s earnings improved due to enhanced asset quality and a
strong recovery rate. BJBR posted QoQ net profit growth, though YoY profit declined due to
the impacts from BI’s rate hikes. Bank CIMB Niaga (BNGA IJ, BUY, TP: IDR2,300) has
emphasised high-yield loans, adjusting its cost of credit (CoC) guidance to below 1% due to
improved asset quality and a lower loan-at-risk (LAR) ratio.
Auto & autoparts’ earnings were above expectations. Strong demand in the used vehicles and
replacement markets contributed to earnings growth despite continued weakness in YoY
new vehicle sales. ASII’s 3Q24 net profit was bolstered by its mining, gold, and financial
services segments, delivering solid performances even as coal prices normalised. AUTO’s
3Q24 revenue was also strong, driven by trading activities and a recovery in manufacturing,
with net profit further supported by equity income from the replacement market.
Consumer showed mixed performance, in which F&B companies like ICBP and INDF had
strong performances that managed to navigate FX headwinds and rising material prices
effectively. The sector also saw a slightly uptick in discretionary spending, though certain
segments faced challenges, eg MYOR, which was affected by a cocoa price surge.
Healthcare and telecom underperformed. Healthcare’s earnings were impacted by a
slowdown in patient volume and rising operational costs. Telecom suffered from weak
demand, as seen in Indosat Ooredoo Hutchison’s (ISAT IJ, NEUTRAL, TP: IDR12,500)
EBITDA, which was affected by low subscriber additions.
Tech results were in line, with both Bukalapak (BUKA IJ, BUY, TP: IDR180) and GoTo Gojek
Tokopedia (GOTO IJ, NR) showed progress in terms of financial performances. BUKA reduced
its net losses and achieved positive core earnings. It also reported a lower adjusted LBITDA.
GOTO moved closer to adjusted EBITDA breakeven, with strong YoY growth in gross
transaction value (GTV) and contribution margin.
Coal and oil & gas showed strong performances, supported by robust commodity prices and
effective cost management, particularly with companies like UNTR and ADRO. However,
metal mining had mixed results, with INCO experiencing margins pressures due to high
energy costs while ANTM saw steady growth supported by high sales volumes.
The infrastructure, toll road, cement, and property development sectors had mixed results.
Infrastructure showed YoY growth from tariff increases, but QoQ earnings normalised due to
seasonal traffic patterns. Cement faced oversupply challenges, impacting ASPs and sales
volumes, while property development experienced normalisation after a strong 1H24.

See important disclosures at the end of this report

2
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Figure 1: 3Q24 results highlights – by sector

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %- FY24F %- Note
RHB RHB Cons Cons
Banks 48,274 49,113 52,808 7.5% 9.4% 141,567 150,760 6.5% 202,472 74% 201,343 75% In line
Auto & 9,261 9,084 10,027 10.4% 8.3% 27,381 27,714 1.2% 32,243 86% 32,515 85% Above
autoparts
Consumer 5,433 4,631 10,712 131.3% 97.2% 21,325 23,092 8.3% 29,065 79% 27,793 83% Mixed
Retail 1,562 2,157 1,996 -7.5% 27.8% 5,629 6,166 9.5% 8,995 69% 9,199 67% Mixed
Poultry 2,152 1,872 1,236 -34.0% -42.6% 3,613 4,483 24.1% 5,099 88% 5,416 83% Above
Tobacco 3,624 1,400 1,974 41.1% -45.5% 10,662 6,217 -41.7% 13,505 46% 11,371 55% Below
Healthcare 1,054 1,525 1,140 -25.2% 8.1% 3,687 4,497 22.0% 6,468 70% 6,231 72% Below
Telecom 8,203 6,921 6,878 -0.6% -16.2% 22,286 21,553 -3.3% 28,728 75% 30,062 72% Below
Tech (1,487) (834) (619) -25.8% -58.4% (7,017) (1,687) -76.0% (3,778) 45% (3,592) 47% In line
Coal 10,389 12,764 13,638 6.8% 31.3% 37,546 37,555 0.0% 45,153 83% 43,358 87% Above
Metal mining 1,166 1,798 867 -51.8% -25.7% 6,303 3,000 -52.4% 4,567 66% 3,828 78% Mixed
Oil & gas 3,588 3,703 2,902 -21.6% -19.1% 8,559 10,401 21.5% 14,650 71% 14,887 70% Mixed
Cement and 1,523 325 952 193.1% -37.5% 3,334 2,091 -37.3% 4,281 49% 3,945 53% Below
building
materials
Property 1,358 1,956 1,433 -26.7% 5.5% 4,438 5,642 27.1% 7,238 78% 7,650 74% In line
development
Infrastructure 720 978 877 -10.3% 21.8% 1,817 2,446 34.6% 3,279 75% 3,206 76% In line
Plantation 629 506 627 23.9% -0.3% 1,240 1,640 32.3% 2,108 78% 2,056 80% Above
Renewable 49 103 46 -55.4% -5.5% 198 200 1.0% 313 64% 4,883 4% Below
energy
Pulp & paper 297 1,516 1,625 7.2% 447.4% 5,469 4,578 -16.3% 6,306 73% 7,592 60% Below
Total 97,797 99,517 109,120 9.6% 11.6% 298,037 310,349 4.1% 410,690 76% 411,742 75% In line

Source: Company data, RHB

See important disclosures at the end of this report

3
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Figure 2: 3Q24 results highlights – commentary

Note Comment
Banks In line In 3Q24, major Indonesian banks mostly aligned with expectations, driven by loan growth and robust non-II. BBCA raised its
FY24 loan growth target to 10-12% despite anticipated 4Q opex pressure. BMRI saw NIM improvement at the consolidated
level, though funding costs affected bank-only NIM. BBNI's results benefited from loan yield increases and focus on low-cost
deposits, while BBRI's earnings rose with improved asset quality and a strong recovery rate. BJBR achieved QoQ net profit
growth but faced YoY declines from BI rate impacts. BNGA focused on high-yield loans, revising its CoC guidance below 1%
due to better asset quality and lower LAR.
Auto & autoparts Above Robust demand in used vehicles and replacement markets helped boost bottomline despite still weak YoY new vehicles sales.
ASII’s 3Q24 net profit was boosted by its mining, gold, and financial services segments, with strong results despite normalised
coal prices. AUTO’s 3Q24 revenue was robust, driven by trading and a recovery in manufacturing, with net profit supported
by equity income from the replacement market.
Consumer Mixed ICBP and INDF booked strong performances – mainly due to FX gains whilst Cisarua Mountain Dairy (CMRY) booked solid
sales. For UNVR, product boycotts (stemming from conflicts in the Middle East) and intensifying competition put pressure on
its performance. Despite booking strong sales, MYOR faced challenges from rising raw material prices (cocoa and coffee).
Retail Mixed MAP Aktif Adiperkasa (MAPA) posted a major surprise given its strong performance amidst low seasonality. Nonetheless, a
soft recovery in the F&B business and end-of-season sales have brought pressure to Mitra Adiperkasa’s (MAPI) performance.
Erajaya Swasembada (ERAA) continued to book solid sales growth from growing volume on affordable products while other
verticals have gained traction.
Poultry Above Overall, 9M24 earnings were above expectations. Soft 3Q24 net profit was due to weak broiler and DOC prices; however, we
believe lower raw material costs partly supported margins in 3Q24.
Tobacco Below The weak 9M24 earnings for HMSP, GGRM, and WIIM were primarily due to downtrading and excise tax hike while ASP hike
were less aggressive in expectation to recover market share in the industry vs. below tier-2 players.
Healthcare Below Slowdown in patient volume for hospital companies due to high base impact, soft purchasing power and number restrictions
both from private insurance and BPJS. SIDO posted weak sales, particularly in herbal and supplement segment, which
pressurize its performance.
Telecom Below 3Q should be the weakest period for the telecom industry. ISAT’s EBITDA eroded on negative topline growth while Telkom
Indonesia (TLKM) booked low single-digit growth in EBITDA and margin expansion but still lower on a YoY basis.
Tech In line BUKA and GOTO saw improvements in 9M24 – net losses narrowed for the former (with positive core earnings and lower
adjusted LBITDA despite a decline in contribution margins) – while the latter approached adjusted EBITDA breakeven,
achieving strong YoY growth in GTV, net revenue, and contribution margins, and reduced net losses by 53%.
Coal Above The strong 9M24 performance was led by UNTR’s solid earnings, with stable mining contracting, targeted heavy equipment
sales bolstered by high-margin units, and rising gold prices, while Bukit Asam (PTBA) faced higher cash costs and lower gross
and net profit margins due to increased pre-stripping activities and expected ASP normalisation. However, its volume
production has improved (in line with seasonality).
Metal mining Mixed The expectation of a decrease in ASP still puts pressure on margins. The positive sentiment from changes in the regional
economy, which is expected to boost demand for base metals, seems to require more time to materialise. ANTM's profits are
still supported by high gold sales volume (in addition to the recovery in nickel ore operations), while INCO is unexpectedly
experiencing margins pressure due to high energy volume requirements.
Oil & gas Mixed PGAS' strong 9M24 earnings were supported by improved GPMs from a higher distribution spread and increased income
from associates. MEDC benefited from a 12% YoY rise in oil and gas sales, as well as associate income, while Amman Mineral
Internasional (AMMN) saw an 808% YoY increase in net profit, though this gain was partially offset by TransAsia Pipeline's
losses. Elnusa’s (ELSA) earnings grew due to higher upstream segment performance, with EBIT margin rising to 7%, while AKR
Corporindo’s (AKRA) weaker results were attributed to reduced mining activities from permit delays, a 5% drop in petroleum
sales, and a 29% YoY decline in trading gross profit amid lower market purchasing power.
Cement and Below Semen Indonesia’s (SMGR) weak 9M24 earnings were impacted by industry-wide cement oversupply and risks of lower
building blended ASPs despite a mid-year price hike, while Indocement’s (INTP) strong 3Q24 results were seasonal, with 4Q24
materials earnings expected to normalise as year-end rains may dampen sales volumes. Arwana Citramulia’s (ARNA) 9M24 earnings are
aligned with expectations, showing a sales volume recovery and stable ASPs in 3Q24, with a positive outlook on its recovery
and an improved competitive landscape.
Property In line Normalising 3Q24 revenue mainly from seasonality in project deliveries while recurring income showed robust growth
development following higher demand in leisure activities especially for the hotel segment.
Infrastructure In line QoQ, revenue and earnings slowed due to normalizing traffic after the holiday season in 2Q, but showed stronger YoY growth
thanks to higher tariffs, particularly from a special tariff adjustment.
Plantation Above Astra Agro Lestari’s (AALI) 9M24 earnings lagged expectations due to weaker FFB output, with potential production gains in
4Q24 despite high unit costs, while PP London Sumatra Indonesia’s (LSIP) strong earnings were supported by high CPO and
PK prices, increased interest income, and favourable tax rates, which are expected to sustain under sympathetic CPO prices, a
weaker USD, and lower export taxes.
Renewable Below Kencana Energi Lestari’s (KEEN) 9M24 earnings were below expectations at 64% as Pakkat and Air Putih's net income
energy dropped 28% and 33% YoY. Revenue declined for both assets: Pakkat's was down 11% YoY while Air Putih's -15% YoY was
the cause behind its below-expected earnings.
Pulp & paper Below Weak 9M24 earnings were driven by lower pulp prices, FX losses, and higher operational expenses, despite an improvement
in pulp sales volume.
Total In line 3Q24 saw solid performance in sectors like banking, auto & autoparts, consumer, and coal, while healthcare, telecom, and
tech underperformed due to industry-specific challenges.
Source: Company data, RHB

See important disclosures at the end of this report

4
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Banks: Resilient 3Q24, robust loan growth, stable asset quality

3Q24 results for major Indonesian banks largely met expectations, with robust loan growth
and non-II as key drivers. BBCA recorded a 12.8% YoY increase in 9M24 earnings, raising its
FY24 loan growth guidance to 10-12% despite an expected seasonal increase in 4Q
operational expenses. BMRI also performed well, with NIM growth at the consolidated level,
although bank-only NIM faced pressure from higher funding costs. Strong loan demand and
improved asset quality, reflected in lower LAR and NPL ratios, supported BMRI’s results.
BBNI’s results were in line, benefiting from higher loan yields and reduced deposit costs,
which contributed to NIM expansion. The bank remains focused on growing low-cost
deposits, enhancing liquidity, and meeting healthy loan demand. BBRI’s earnings grew 11.2%
QoQ and 5.5% YoY, with non-II and NIM gains as primary contributors. Improved asset quality
and recovery rate also strengthened its 4Q24 earnings outlook.
BJBR posted a 21.1% QoQ rise in net profit, but its 9M24 earnings declined by 19% YoY due
to the impact of higher central bank rates on its NIM. While loan growth was slower than
expected, the bank saw improvement in its CASA ratio. Increased credit costs are anticipated
for 4Q24.
BNGA maintained a stable 3Q24 net profit, reaching IDR5.1trn for 9M24, with a 6.4% YoY
increase in loan growth led by selective segments, excluding mortgages. The bank revised its
FY24 CoC guidance to below 1% due to better asset quality and a reduced LAR, prioritising
high-yield, low-risk loans.
Overall, Indonesian banks demonstrated resilience in 3Q24, supported by stable asset quality
and targeted loan growth strategies. While some challenges such as higher funding costs and
anticipated seasonal expenses in 4Q remain, the sector is largely on track to meet or slightly
exceed full-year projections.

See important disclosures at the end of this report

5
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Figure 3: Banks’ 3Q24 results highlights (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %- FY24F %- Note
RHB RHB Cons Cons
BBCA 12,230 13,997 14,198 1.4% 16.1% 36,420 41,074 12.8% 53,565 77% 53,913 76% In line
BMRI 13,832 13,848 15,467 11.7 11.8% 39,064 42,017 7.6% 55,145 76% 56,281 75% In line
%
BBNI 5,452 5,365 5,617 4.7% 3.0% 15,753 16,308 3.5% 21,458 76% 22,038 74% In line
BBRI 14,565 13,816 15,363 11.2 5.5% 43,993 45,065 2.4% 63,830 71% 60,879 74% In line
%
BJBR 526 361 437 21.1 -16.9% 1,435 1,163 -19.0% 1,478 79% 1,478 79% In line
%
BNGA 1,669 1,726 1,726 0.0% 3.4% 4,902 5,133 4.7% 6,996 73% 6,754 76% In line
Total 48,274 49,113 52,808 7.5% 9.4% 141,567 150,760 6.5% 202,472 74% 201,343 75% In line
Source: Company data, RHB

Figure 4: Banks’ 3Q24 results commentary

(IDRbn) Note Key insights from the results analysis

BBCA In line Robust 3Q24 results in line, however 4Q opex tends to be seasonally higher, which could dampen bottomline. On the back of robust
loans growth, management raised its FY24 loans growth guidance to 10-12% from 8-10%.

BMRI In line Solid 3Q24 net profit met expectations, aided by increased non-II and reduced provisions. Consolidated NIM grew QoQ, though
bank-only NIM declined due to rising funding costs. Loan demand stayed strong, with stable asset quality and improved LAR and NPL
ratios.

BBNI In line 3Q24 results aligned with expectations, highlighted by NIM growth from increased loan yields and lower deposit costs. BBNI
management remains optimistic, focusing on strong loan demand, improving liquidity, and expanding low-cost deposits.
BBRI In line 3Q24 earnings increased 11.2% QoQ, supported by higher non-II and slight NIM gains, with 9M24 earnings up 2.4% YoY. Improved
asset quality and recovery rate, alongside lower expected credit costs, bolster 4Q24’s growth prospects.
BJBR In line 3Q24 net profit rose 21.1% QoQ, meeting expectations, though 9M24 earnings dropped 19% YoY due to NIM pressures from higher
BI rates. Loan growth lagged, but CASA improved, with higher 4Q24 credit costs expected.
BNGA In line Stable 3Q24 net profit, in line with expectations. Loan growth reached 6.4% YoY, excluding mortgages, with focus on profitability.
Lower NIM of 4.07% led to revised FY24F guidance, while improved asset quality and reduced LAR prompted CoC guidance below
1%, prioritising selective, high-yield, low-risk loans.
Overall In line In 3Q24, major Indonesian banks mostly aligned with expectations, driven by loan growth and robust non-interest income. BBCA
raised its FY24 loan growth target to 10-12% despite anticipated 4Q opex pressure. BMRI saw NIM improvement at the
consolidated level, though funding costs affected the bank-only segment NIM. BBNI's results benefited from loan yield increases
and focus on low-cost deposits, while BBRI's earnings rose with improved asset quality and a strong recovery rate. BJBR achieved
QoQ net profit growth but faced YoY declines from BI rate impacts. BNGA focused on high-yield loans, revising its CoC guidance
below 1% due to better asset quality and lower LAR.
Source: Company data, RHB

See important disclosures at the end of this report

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Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Auto & autoparts: Surpass 3Q24 with strong performance in finance and used vehicles
ASII's 3Q24 earnings exceeded expectations, driven by its mining contracting, gold, and
financial services sectors. Despite the normalisation of coal prices, ASII achieved strong
results, largely supported by sales volumes from its mining activities and a robust
performance in financial services. This resilience highlights the company’s ability to maintain
profitability even with changes in commodity prices.
AUTO also performed well, with its 3Q24 trading revenue remaining strong while
manufacturing revenue showed signs of recovery. The total revenue in 3Q24 was strong, and
net profit continued to be bolstered by equity income, particularly from the replacement
market. This indicates robust demand in the used vehicle and replacement sectors, which
offset weaker sales in new vehicles YoY.
Overall, ASII and AUTO’s performances reflect their strategic adaptability, focusing on high-
demand areas such as financial services, used vehicles, and mining amidst changing market
conditions. Both companies achieved c.85% of their full-year forecasts, with ASII at 86% and
AUTO at 83%, positioning them well to meet or exceed their year-end targets.
ASII's strong 9M24 earnings, and management’s optimistic outlook for end-2024 and FY25
have prompted an upgrade to its FY24-25 forecasts. The company’s valuation is primarily
supported by its finance and mining segments.

Figure 5: Auto & autoparts’ 3Q24 results highlight (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %- FY24F %- Note
RHB RHB Cons Cons
ASII (core profit) 8,750 8,544 9,513 11.3% 8.7% 26,069 26,186 0.4% 30,424 86% 30,663 85% Above
AUTO 511 540 514 -4.8% 0.6% 1,312 1,528 16.5% 1,819 84% 1,852 83% Above
Total 9,261 9,084 10,027 10.4% 8.3% 27,381 27,714 1.2% 32,243 86% 32,515 85% Above
Source: Company data, RHB

Figure 6: Auto & autoparts’ 3Q24 results commentary

Note Key insights from the results analysis
ASII (core profit) Above ASII's 3Q24 earnings were driven by the mining contracting, gold, and financial services businesses. While 3Q24
numbers reflected normalised coal prices from the beginning of last year, the company still managed to book strong
results, mainly supported by financial services and sales volumes from its mining activities.
AUTO Above As expected, AUTO's 3Q24 trading revenue was still strong while manufacturing revenue recovered. This strengthened
total 3Q24 revenue, while net profit was supported by equity income, mostly from the parts replacement market.
Overall Above The robust used vehicles and parts replacement market helped boost the companies’ bottomlines despite still-weak
YoY new vehicle sales. ASII’s 3Q24 earnings were boosted by its mining, gold, and financial services sectors, with
strong results despite normalised coal prices. AUTO’s 3Q24 revenue was robust, driven by trading and a recovery in
manufacturing, with net profit supported by equity income from the parts replacement market.
Source: Company data, RHB

See important disclosures at the end of this report

7
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Consumer: Mixed results as FX gains boost ICBP and INDF, while MYOR and
UNVR face cost pressures and market challenges
Overall, the consumer sector saw a mixed performance, with companies benefiting from
favourable exchange rates, while others faced challenges from raw material costs and market
pressures.
In 3Q24, ICBP and INDF achieved strong performances, largely driven by substantial FX gains
from the IDR’s appreciation and solid sales. INDF also benefitted from improved margins.
Cisarua Mountain Dairy (CMRY IJ, BUY, TP: IDR5,700) recorded a solid sales performance,
remaining in line with expectations. However, MYOR struggled due to increased raw material
costs for cocoa and coffee, which compressed margins, leading to a below-expectations
performance. Similarly, UNVR faced weak earnings due to sluggish sales and rising operating
expenses, compounded by intensifying competition and boycott issues.
ICBP's 9M24 growth was primarily driven by sales volumes, with sales of noodles up 7% YoY
and dairy up 8%, with modest gains in snacks, seasonings, nutrition, and beverages. Noodle
sales volumes rose 5% domestically and 23% in overseas markets in 3Q24, with strong
demand in Egypt, Turkey, and key markets. New launches, like the Korean Ramyeon series,
gained traction, with marketing focused on social media to target younger consumers. Ice
cream products also performed well, albeit with a small revenue share, and the company
maintained its A&P-to-revenue ratio guidance at 4%.
INDF's growth was supported by strong performances in Bogasari, LSIP, and ICBP. Bogasari’s
volumes rose 12%, maintaining a 6-8% EBIT margin, while ICBP expects 5-8% revenue growth
from sales volumes. LSIP exceeded expectations, benefiting from high CPO prices and
favourable tax changes. We revised up LSIP’s FY24F-26F earnings by 24%, 24%, and 21%
after reducing our unit cost assumptions, raising interest income, and lowering effective tax
rates.
CMRY achieved a 45.5% GPM in 3Q24, and expects this to stabilise at 42-44% due to
potential raw material price fluctuations. Growth in the dairy segment is driven by UHT milk
sales volumes and a recovery in yogurt product sales, with new products gaining traction.
CMRY is expanding its distribution, especially in general trade, and investing heavily in
marketing. It anticipates a 20-22% ratio of marketing expenses to revenue to boost yogurt
consumption.

Figure 7: Consumer sector’s 3Q24 results highlight (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %- FY24F %-Cons Note
RHB RHB Cons
ICBP 1,335 1,186 4,612 289.0% 245.5% 7,060 8,149 15.4% 10,222 80% 9,016 90% Above
INDF 1,517 1,404 4,907 249.3% 223.5% 7,083 8,761 23.7% 9,176 95% 9,268 95% Above
MYOR 807 606 298 -50.9% -63.1% 2,026 2,015 -0.5% 3,469 58% 3,385 60% Below
UNVR 1,430 1,019 543 -46.7% -62.0% 4,189 3,010 -28.1% 4,606 65% 4,629 65% Below
CMRY 345 416 353 -15.1% 2.3% 967 1,156 19.5% 1,592 73% 1,495 77% In line our,
Above cons.
Total 5,433 4,631 10,712 131.3% 97.2% 21,325 23,092 8.3% 29,065 79% 27,793 83% Mixed
Source: Company data, RHB

Figure 8: Consumer sector’s 3Q24 results commentary

Note Key insights from the results analysis
ICBP Above IDR appreciation, translated to substantial forex gain
INDF Above Strong sales, improved margin and IDR appreciation, translated to substantial forex gain
MYOR Below Soaring raw material cost (cocoa and coffee) pressured margin
UNVR Below Slow sales along with increasing opex
CMRY In line our, Solid sales performance
Above cons.
Overall Mixed ICBP and INDF booked strong performance mainly due to the forex gain whilst CMRY booked solid sales. For UNVR, boycott issue
along with intensifying competition put pressure on its performance. Despite booking strong sales, MYOR faced challenge from
rising raw material price (cocoa and coffee)
Source: Company data, RHB

See important disclosures at the end of this report

8
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Retail: Mixed results; some companies saw strong sales, others faced margin
pressures and seasonal challenges
Retail companies saw a mixed performance in 3Q24, with some benefiting from solid sales
growth, while others faced challenges. MAP Aktif Adiperkasa (MAPA IJ, BUY, TP: IDR930)
outperformed expectations with strong sales growth and effective cost controls despite 3Q
being a low season. Erajaya Swasembada (ERAA IJ, NEUTRAL, TP: IDR420) saw robust
profitability driven by higher sales volumes, particularly in the affordable product segment,
and expanded verticals.
Mitra Adiperkasa’s (MAPI IJ, BUY, TP: IDR1,800) performance was impacted by the soft
recovery in its F&B business and the end-of-season sales, which pressured margins. Aspirasi
Hidup Indonesia’s (ACES IJ, TRADING BUY, TP: IDR815) results were in line with historical
trends, with its 9M24 earnings achieving 62-67% of full-year targets, consistent with past
years. Meanwhile, Sumber Alfaria Trijaya’s (AMRT IJ, BUY, TP: IDR3,800) 9M24 earnings met
expectations, achieving c.60% of our and consensus’ full-year projections.
Overall, the sector displayed a mixed outcome, with some companies thriving due to volume
growth and strategic cost management, while others struggled with seasonal and segment-
specific pressures.

Figure 9: Retail sector’s 3Q24 results highlights (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %- FY24F %- Note
RHB RHB Cons Cons
ERAA 36 268 268 -0.1% 640.9% 495 791 59.9% 1,030 77% 957 83% Above
MAPI 372 485 401 -17.5% 7.7% 1,416 1,300 -8.2% 1,903 68% 1,900 68% Below
ACES 183 164 208 27.1% 13.7% 486 574 18.2% 932 62% 863 67% In line
MAPA 393 336 515 53.2% 30.9% 1,042 1,102 5.8% 1,207 91% 1,413 78% Above
AMRT 578 904 605 -33.1% 4.7% 2,190 2,399 9.5% 3,923 61% 4,066 59% In line
Total 1,562 2,157 1,996 -7.5% 27.8% 5,629 6,166 9.5% 8,995 69% 9,199 67% Mixed
Source: Company data, RHB

Figure 10: Retail sector’s 3Q24 results commentary

Note Key insights from the results analysis
ERAA Above Solid sales volumes boosted its profitability
MAPI Below Weighed down by F&B business, end of season sales pinched margins.
ACES In line Although 9M24 earnings were at 62-67% of full-year earnings, we deem this as in line, as 9M16-23 recorded an average of 64.2%.
MAPA Above Strong sales growth along with solid operating cost controls.
AMRT In line 9M24 earnings were within expectations, at 61.1% and 59.0% of our and consensus' full-year estimates (9M19-23 average: c.60%).
Overall Mixed MAPA posted a major surprise with a strong performance amidst weak seasonality. The soft recovery in its F&B business, along with the
end-of-season sales pressured MAPI's performance. ERAA continued to book solid sales growth from growing sales volumes for
affordable products, while other verticals gained traction.
Source: Company data, RHB

See important disclosures at the end of this report

9
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Poultry: 9M24 earnings resilience despite 3Q24 challenges

Overall poultry sector earnings for 9M24 were above expectations, although 3Q24 saw a
decline in net profit due to weak broiler and day-old chick (DOC) prices, impacting companies
like Charoen Pokphand Indonesia (CPIN IJ, BUY, TP: IDR5,800) and JPFA.
CPIN’s earnings were in line with expectations, but 3Q24 net profit fell QoQ due to the lower
poultry prices. Despite this, we anticipate better results in 4Q24, expecting a recovery in
poultry prices and positive momentum in its processed chicken segment.
JPFA performed better, with its 9M24 earnings exceeding expectations, largely supported by
lower raw material costs, which helped offset margin pressures from weak poultry prices.
JPFA’s margins benefited from supply-demand adjustments for broilers and DOC, along with
seasonally higher year-end demand, which is expected to continue to support earnings.
Overall, while 3Q24 was challenging due to lower poultry prices, we are optimistic about a
recovery in 4Q24, with potential improvements from higher demand and better pricing. We
remain cautiously positive on the sector, with expectations of stable margins in the upcoming
quarter.
Following JPFA's strong 9M24 results, we have raised our FY24-26F earnings forecasts, as
we anticipate a more balanced supply-demand environment for broilers and DOC, supported
by supply management strategies and increased year-end demand.

Figure 11: Poultry sector’s 3Q24 results highlights (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %- FY24F %- Note
RHB RHB Cons Cons
CPIN 1,297 1,057 619 -41.4% -52.3% 2,676 2,387 -10.8% 2,865 83% 3,214 74% Above our,
In line cons.
JPFA 855 814 617 -24.2% -27.8% 937 2,096 123.7% 2,234 94% 2,202 95% Above
Total 2,152 1,872 1,236 -34.0% -42.6% 3,613 4,483 24.1% 5,099 88% 5,416 83% Above
Source: Company data, RHB

Figure 12: Poultry sector’s 3Q24 results commentary

Note Key insights from the results analysis
CPIN Above our, In overall, CPIN's 9M24 earnings were in line. As expected 3Q24 net profit was soft mainly due to weak broiler and day-old chicks
In line cons. (DOC) prices. We do anticipate improved performances in 4Q24, driven by a recovery in poultry prices and positive developments in
the processed chicken segment.
JPFA Above JPFA robust 9M24 earnings was driven by lower raw material costs support margins despite weak poultry price in 3Q24. We expect a
more balanced supply-demand dynamic for broilers and day-old chicks (DOC) to support poultry prices, aided by supply management
measures and seasonally higher year-end demand.
Overall Above In overall, 9M24 earnings above expectation. Soft 3Q24 net profit was due to weak broiler and DOC prices; however, we expect
more favourable poultry prices to possibly boost earnings going forward.
Source: Company data, RHB

See important disclosures at the end of this report

10
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Tobacco: Challenges in 9M24 amid rising excise taxes, downtrading trends, and
limited price adjustments
The tobacco sector faced a challenging 9M24, with HMSP, GGRM, and WIIM all reporting
weaker earnings that were below expectations. HMSP's earnings were impacted by higher
operational expenses, including salaries and promotions, along with rising excise taxes and
raw material costs. A shrinking market share due to consumer downtrading also limited sales
growth.
GGRM’s earnings suffered from an insufficient ASP increase, which was unable to offset rising
excise taxes. While the company focused on volume growth in the machine-rolled kretek
(SKM) segment, downtrading led to modest sales growth, while sales in the hand-rolled kretek
(SKT) segment declined. Elevated operating expenses further reduced net margins.
WIIM experienced stagnant volume growth, capped by tier-2 market limits, and has not raised
prices since January, eroding its GPM to 6% due to rising excise taxes. The company expects
performance improvements in 4Q24 if sales increase as anticipated.
Overall, the sector’s weak 9M24 performance is attributed to downtrading trends, high excise
taxes, and less aggressive ASP hikes, which hindered market share recovery compared to tier-
2 competitors.

Figure 13: Tobacco sector’s 3Q24 results highlights (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %- FY24F %- Note
RHB RHB Cons Cons
HMSP 2,455 1,070 1,908 78.3% -22.3% 6,205 5,224 -15.8% 8,903 59% 8,097 65% Below
GGRM 1,169 330 67 -79.8% -94.3% 4,457 992 -77.7% 4,602 22% 3,274 30% Below
WIIM 195 57 60 6.3% -69.0% 441 208 -53.0% 396 52% 396 52% Below
Total 3,624 1,400 1,974 41.1% -45.5% 10,662 6,217 -41.7% 13,505 46% 11,371 55% Below
Source: Company data, RHB

Figure 14: Tobacco 3Q24 results commentary

Note Key insights from the results analysis
HMSP Below Weak 9M24 earnings were due to higher opex (salaries, advertising, promotions, and other overhead expenses), and higher excise
taxes and raw material costs. A shrinking market share due to downtrading (which limited sales volume growth) also pressured its
sales price.
GGRM Below Lower-than-expected 9M24 earnings were due to insufficient ASP hikes to offset the excise tax. While it tried to boost volume growth
by not increasing prices, downtrading led GGRM to book modest sales growth in the SKM segment and lower sales in the SKT
segment. Surging operating expenses further eroded its net margin.
WIIM Below Capped by its tier-2 limit on sales volumes, WIIM’s sales volumes remained stagnant while prices were not increased in January-
September, resulting in weak SKM sales in 9M24, with expectations of a better 4Q24. With prices remaining stagnant while excise
taxes increased, its GPM was eroded, resulting in its net margin falling to 6%.
Overall Below Weak 9M24 earnings for HMSP, GGRM, and WIIM were primarily due to downtrading and the excise tax hikes, while ASP hikes
were less aggressive in expectations of recovering market share in the industry vs below-tier-2 players.
Source: Company data, RHB

See important disclosures at the end of this report

11
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Healthcare: Mixed 9M24 numbers amid patient volume decline and purchasing
power challenges; KLBF’s pharmaceutical division is a bright spot
The healthcare sector recorded mixed 9M24 numbers, with overall earnings falling below
expectations due to challenges related to patient volume and purchasing power. Both Mitra
Keluarga Karyasehat (MIKA IJ, BUY, TP: IDR3,500) and Hermina Medikaloka (HEAL IJ, BUY,
TP: IDR1,700) faced a decline in patient volume, which dampened their performance. The
lower numbers were also attributed to the high base, limitations from private insurance
patients, and Social Security (BPJS) restrictions – these factors jointly pressured hospital
revenues.
Kalbe Farma (KLBF IJ, BUY, TP: IDR1,970) did relatively well, with its pharmaceutical division
meeting expectations and contributing positively to its overall performance. However, Sido
Muncul (SIDO IJ, NEUTRAL, TP: IDR620) struggled with weak sales, especially in its herbal
and supplement segment, as lower consumer purchasing power dampened the demand for
discretionary health products.
Overall, the healthcare sector’s 9M24 results were impacted by external pressures, including
soft demand and insurance-related constraints, with KLBF being the exception due to the
steady performance of its pharmaceutical segment.

Figure 15: Healthcare sector’s 3Q24 earnings review (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %- FY24F %- Note
RHB RHB Cons Cons
MIKA 233 312 272 -12.6% 16.9% 686 873 27.2% 1,223 71% 1,171 75% Below

HEAL 147 152 125 -17.9% -14.7% 349 468 34.2% 728 64% 602 78% Below

KLBF 536 843 573 -32.0% 7.0% 2,065 2,378 15.2% 3,207 74% 3,261 73% In line

SIDO 138 218 170 -22.2% 22.5% 587 778 32.7% 1,310 59% 1,197 65% Below

Total 1,054 1,525 1,140 -25.2% 8.1% 3,687 4,497 22.0% 6,468 70% 6,231 72% Below

Source: Company data, RHB

Figure 16: Summary of the healthcare sector’s 3Q24 results

Performance Key insights from the results analysis
vs estimates
MIKA Below Slowdown in patient volume.
HEAL Below Slowdown in patient volume.
KLBF In line Pharmaceutical division continued to perform well.
SIDO Below Soft purchasing power to curb sales.
Overall Below Slowdown in patient volume for hospital companies was due to a high base, softer consumer purchasing power and restrictions
from both from private insurers and BPJS. SIDO posted weak sales, particularly in the herbal and supplement segment, which
toned down its performance.
Source: Company data, RHB

See important disclosures at the end of this report

12
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Telecommunications: Weak 3Q24 as ISAT and TLKM struggle with declining data
demand, ARPU and subscriber bases
The sector faced a challenging 3Q24, with both ISAT and Telkom Indonesia (TLKM IJ, BUY,
TP: IDR4,780) reporting earnings below expectations. ISAT booked a 20.6% QoQ decline in
net profit, impacted by slower data consumption and a decrease in subscriber numbers. Its
EBITDA eroded due to weaker topline growth, which highlighted a difficult quarter for the
telecom industry.
TLKM’s results also deteriorated, with revenue down 9.4% YoY and a slight decline in EBITDA
growth. The company faced challenges from declining ARPU and lower data yields in mobile
revenue, while other segments, such as interconnection and enterprise, also saw declines.
TLKM managed to achieve low single-digit EBITDA growth and some margin expansion QoQ,
although it remained lower on a YoY basis.
Overall, 3Q24 was a weak period for the telecommunications sector, with both ISAT and
TLKM affected by reduced data demand, lower ARPU, and subscriber base contraction.
Despite minor margin gains for TLKM, the industry struggled with overall revenue and
EBITDA declines compared to the previous year.

Figure 17: Telecommunications sector’s 3Q24 earnings review (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %- FY24F %- Note
RHB RHB Cons Cons
ISAT 879 1,440 1,143 -20.6% 30.0% 2,787 3,878 39.1% 4,883 79% 5,234 74% Slightly
below
TLKM 7,324 5,481 5,735 4.6% -21.7% 19,499 17,675 -9.4% 23,845 74% 24,828 71% EBITDA
below
Total 8,203 6,921 6,878 -0.6% -16.2% 22,286 21,553 -3.3% 28,728 75% 30,062 72% Below
Source: Company data, RHB

Figure 18: Summary of the telecommunications sector’s 3Q24 results

Performance Key insights from the results analysis
vs estimates
ISAT Slightly below Slower data consumption and lower number of subscribers.
TLKM EBITDA below Declining ARPU and lower data yield led to a decline in mobile revenue. Other segment such as interconnection, enterprise also
saw a decline in both YoY and QoQ terms.
Overall Below 3Q should be the weakest period for the telecommunications industry. ISAT EBITDA eroded on negative top line growth while
TLKM booked low single digit growth in EBITDA and margin expansion but still lower on YoY basis,
Source: Company data, RHB

See important disclosures at the end of this report

13
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Technology: A recovery in 9M24 as BUKA turned profitable, while GOTO closed

the distance to breaking even on EBITDA terms with strong growth metrics
In 9M24, the technology sector showed signs of improvement, with both BUKA and GOTO
reducing their net losses. BUKA’s core earnings turned positive, and its adjusted LBITDA
decreased due to effective cost control. However, contribution margins weakened YoY and
QoQ, partly due to a seasonal decline in its gaming division. Overall, BUKA’s 9M24 net loss
improved by 24% YoY.
GOTO, meanwhile, saw substantial progress, with a 99% improvement in adjusted EBITDA,
nearing the breakeven point. The company achieved strong growth metrics, with its gross
transaction value (GTV) up 55% YoY, net revenue increasing 94%, and contribution margin
rising by 47% YoY. Monthly transacting users or MTUs grew by 21%, and GOTO reduced its
net loss by 53% YoY to IDR4.5trn.
In summary, both BUKA and GOTO demonstrated better financial stability in 9M24, with a
focus on cost efficiency and revenue growth. BUKA’s core earnings turned positive, while
GOTO approached the EBITDA-breakeven point, supported by significant growth in key
performance indicators. Despite challenges in contribution margins, the overall outlook for
both companies remains positive.

Figure 19: Technology sector’s 3Q24 earnings review (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %- FY24F %- Note
RHB RHB Cons Cons
BUKA *) 63 120 36 -70.0% -42.9% (74) 342 562.2% 231 148% 486 70% Above our,
core In line cons.
earnings
GOTO (1,550) (954) (655) -31.3% -57.7% (6,943) (2,029) -70.8% (4,009) 51% (4,078) 50% In line
Total (1,487) (834) (619) -25.8% -58.4% (7,017) (1,687) -76.0% (3,778) 45% (3,592) 47% In line
Source: Company data, RHB

Figure 20: Summary of the technology sector’s 3Q24 results

Performance Key insights from the results analysis
vs estimates
BUKA *) core Above our, In 9M24 net loss improved by 24% YoY to IDR593bn, core earnings turned positive, and adjusted LBITDA decreased due to
earnings line with cost control efforts, although contribution margins declined YoY and QoQ, with a seasonal dip in 3Q24 due to a weaker
cons. gaming division’s performance.
GOTO In line 9M24 adjusted EBITDA improved 99%, approaching the breakeven level, with GTV up 55% YoY, net revenue up 94% YoY,
and a 47% YoY increase in contribution margin, driven by a 21% rise in MTUs, while net loss improved 53% YoY to
IDR4.5trn.

Overall In line BUKA and GOTO saw improvements in 9M24: Net losses narrowed for the first time, with positive core earnings and
lower adjusted LBITDA despite a decline in contribution margins, while GOTO approached the adjusted EBITDA-
breakeven point, achieved strong YoY growth in GTV, net revenue, and contribution margin, and reduced net loss by 53%.
Source: Company data, RHB

See important disclosures at the end of this report

14
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Coal: Outperforms expectations in 3Q24, driven by UNTR and ADRO

Overall, the combined earnings of coal companies – which have been reported their 3Q24
results – rose 6.8% QoQ and 31.3% YoY, led mainly by the strong results from UNTR and
ADRO. The sector's total 9M24 earnings came up to 83% of RHB's FY24 forecast and 87% of
the consensus estimate, indicating that the sector is performing above expectations. While
UNTR and ADRO have outperformed expectations with their effective cost control and high-
margin product sales, Bukit Asam (PTBA IJ, NEUTRAL, TP: IDR2,900) is managing stable
growth amid some cost-related challenges.
UNTR demonstrated impressive growth with a 21.6% increase QoQ and a 46.6% rise YoY.
This strong performance is attributed to stable operations in mining contracting and
substantial sales of high-margin heavy equipment, aided by favourable gold price trends. With
its revenue achieving 81% of our forecast for FY24, we lifted UNTR’s FY24-25F net earnings
by 11% and 10% as the company demonstrated noteworthy resilience throughout the year,
reporting exceptional 3Q24 net profit.
ADRO maintained stable 3Q24 earnings despite a minor 0.1% decline QoQ, thanks to
effective cost management and operational efficiency that helped preserve its margins. Its
cumulative earnings have reached 92% of the consensus forecast, supported by steady
production volumes and coal price stability.
In contrast, PTBA recorded a slight 3Q24 earnings dip of 3.5% QoQ, but posted a 19.3% YoY
growth for 9M24. PTBA’s performance remains aligned with expectations, having achieved
75% of our full-year forecast. However, the company encountered rising cash costs and a
reduction in profit margins, impacted by pre-stripping activity and the anticipated
normalisation of ASP.

Figure 21: Coal sector’s 3Q24 earnings review (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %- FY24F %- Note
RHB RHB Cons Cons
UNTR 4,132 4,985 6,059 21.6% 46.6% 15,349 15,592 1.6% 19,291 81% 18,157 86% Above
ADRO (USDm) 345 404 404 -0.1% 17.1% 1,219 1,183 -3.0% 1,378 86% 1,284 92% Above
PTBA 1,004 1,242 1,198 -3.5% 19.3% 3,779 3,230 -14.5% 4,331 75% 5,138 63% In line
Total (eq. IDRbn) 10,389 12,764 13,638 6.8% 31.3% 37,546 37,555 0.0% 45,153 83% 43,358 87% Above
Source: Company data, RHB

Figure 22: Summary of the coal sector’s 3Q24 results

Performance Key insights from the results analysis
vs estimates
UNTR Above 9M24 solid earnings was driven by a stable performance in mining contracting, heavy equipment sales meeting targets
(supported by management's strategy to sell high-margin units), and gold price surges.

ADRO Above Operational stability, evidenced by margin efficiency (reflected in the reduction of cash costs), supported by operational
volumes that meet the targets along with a relatively defensive ASP of coal throughout the year, led to results that exceed
our and consensus expectations.
PTBA In line Cash costs surged throughout the year which was driven by heightened pre-stripping activity early in the year. As
anticipated, 9M24 GPMs stood at 18% vs 9M23’s 21%. Additionally, PTBA’s NPMs were significantly impacted (9M24:
11% vs the 5-year average of 19%) – primarily due to the anticipated normalisation of ASPs.

Overall Above The strong 9M24 performance was led by UNTR’s solid earnings, with stable mining contracting, targeted heavy
equipment sales bolstered by high-margin units, and rising gold prices, while PTBA faced higher cash costs and lower
gross and net profit margins due to increased pre-stripping activity and expected ASP normalisation - however, its
volume production is improved (in line with its seasonality).
Source: Company data, RHB

See important disclosures at the end of this report

15
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Metal mining: Mixed performances – INCO struggles with high energy costs,
while ANTM thrives on strong demand and diversification
Overall, the metal mining sector’s performance was mixed. While INCO faced significant
margin pressure due to energy costs, ANTM showed resilience, supported by its diversified
operations and strong demand. The sector outlook remains cautious, with pressures on
margins from expected ASP decreases and slower-than-expected demand recovery in
regional markets being anticipated.
INCO’s underperformance is attributed to challenges in managing margins, driven by high
energy costs, particularly for high-sulphur fuel oil required for its operations. With 9M24
earnings coming up to only 58% and 56% of our/consensus FY24F, INCO’s results are
considered as below expectations due to these high energy consumption needs impacting
overall production costs.
On the other hand, ANTM’s performance exceeded expectations, with 9M24 earnings at 92%
of the consensus FY24 estimate. The company's results were bolstered by strong gold sales
volume, a stable ASP in the nickel ore segment, and rising domestic demand, despite slight
margin pressure due to raw material costs in its gold refinery operations. ANTM’s diversified
product base, including gold and nickel, helped cushion its performance amidst challenging
conditions. We raised ANTM’s FY24-25F earnings by 6% each on the notion of higher gold
sales targets.

Figure 23: Metal mining sector’s 3Q24 earnings review (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %- FY24F %- Note
RHB RHB Cons Cons
INCO (USDm) 13 31 14 -55.5% 4.0% 221 51 -76.9% 88 58% 91 56% Below
ANTM 959 1,312 651 -50.4% -32.1% 2,849 2,201 -22.7% 3,190 69% 2,402 92% Above
Total (eq. IDRbn) 1,166 1,798 867 -51.8% -25.7% 6,303 3,000 -52.4% 4,567 66% 3,828 78% Mixed
Source: Company data, RHB

Figure 24: Summary of the metal mining sector’s 3Q24 results

Performance Key insights from the results analysis
vs estimates
INCO (USDm) Below Weak 9M24 earnings were driven by the challenges in the ability to manage its margins – the required high-sulphur fuel
oil consumption for 9M24, along with coal usage. Energy costs are a significant portion of overall production costs.
ANTM Above The increase in gold sales volume, supported by rising domestic demand for safe havens and a relatively stable ASP
related to the nickel ore segment, continues to have a positive impact, even though margins are slightly pressured (due to
an increase in COGS from the use of raw materials for its gold refinery). Overall operational numbers are still within its
target.
Overall (eq. Mixed The expectation of a decrease in ASP still puts pressure on margins. The positive sentiment from changes in the
IDRbn) regional economy, which is expected to boost demand for base metals, may need more time to materialise. ANTM's
profits are still supported by high gold sales volumes (in addition to the recovery in nickel ore operations), while INCO
is unexpectedly experiencing margin pressure due to high energy volume requirements.
Source: Company data, RHB

See important disclosures at the end of this report

16
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Oil & gas: Mixed earnings – PGAS and MEDC resilience, while AKRA faces market and
operational challenges
Overall, oil & gas’ earnings were mixed, with PGAS and MEDC showing resilience through
higher distribution spreads and improved associate income, while Elnusa (ELSA)
demonstrated stable growth. However, AKR Corporindo (AKRA) struggled with weaker sales
and profitability, impacted by market and operational challenges.
PGAS exceeded our expectations with 9M24 earnings at 84% of our FY24F forecast, driven
by an improved GPM due to a higher distribution spread and increased income from
associates. The company reported strong growth, with YoY 9M24 earnings rising by 32.7%
YoY, supported by cost controls and favourable associate income contributions.
MEDC’s earnings aligned with expectations, achieving 70% of our FY24 forecast, largely due
to a 12% YoY increase in oil and gas sales and higher associate income. A notable boost came
from Amman Mineral Internasional's (AMMN IJ, NR) substantial 808% YoY net profit
increase. However, MEDC’s results were partially offset by losses in the TransAsia Pipeline.
ELSA’s 9M24 earnings met our expectations, but were above consensus at 71% and 90% of
FY24F, attributed to steady upstream segment growth, though its downstream segment was
relatively flat. ELSA also improved its EBIT margin from 6% in 9M23 to 7% in 9M24, reflecting
operational efficiency.
By contrast, AKRA’s results fell below expectations, with 9M24 earnings at only 51% and 52%
of our and consensus FY24F. The company faced challenges due to decreased petroleum
volume, lower trading gross profit, and a 5% YoY decline in 9M24 petroleum sales amid
weaker purchasing power in the trading market. Reduced mining activity due to permit delays
also impacted AKRA’s results.

Figure 25: Oil & gas’ 3Q24 results highlights (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %- FY24F %- Note
RHB RHB Cons Cons
PGAS (USDm) 53 65 77 17.3% 44.4% 198 263 32.7% 314 84% 344 77% Above our,
In line cons
MEDC (USDm) 123 129 72 -44.0% -41.3% 241 273 13.3% 390 70% 390 70% In line
ELSA 157 260 109 -58.1% -30.4% 405 551 36.0% 776 71% 612 90% In line our,
above cons
AKRA 679 407 466 14.5% -31.4% 1,287 1,469 14.1% 2,869 51% 2,809 52% Below
Total 3,588 3,703 2,902 -21.6% -19.1% 8,559 10,401 21.5% 14,650 71% 14,887 70% Mixed
Source: Company data, RHB

Figure 26: Oil & gas 3Q24 results commentary

Note Key insights from the results analysis
PGAS Above (our), In line Solid 9M24 earnings were driven by Improved GPM due to a higher distribution spread, significantly lower net interest
(USDm) (cons) expense, and higher income from associate.
MEDC In line 9M24 earnings were driven by 12% YoY increase in oil & gas sales contracts and better contribution from net income of
(USDm) associates. AMMN booked a USD625m net profit (+808% YoY). Unfortunately, a substantial increase in AMMN's net
income was offset by TransAsia Pipeline’s losses.
ELSA In line (our), Above 9M24 earnings were driven by YoY increase in the upstream segment while the downstream segment remained relatively
(cons) flat. Meanwhile, EBIT margin improved to 7% in 9M24, from 6% in 9M23.
AKRA Below Weak 9M24 earnings were mainly driven by lower-than-expected petroleum volume and Java Integrated Industrial and
Ports or JIIPE land sales. Management attributed this shift to lower mining activity due to permit delays. AKRA’s petroleum
sales volume declined by 5% YoY in 9M24. Trading gross profit also fell by 29% YoY, as the general market has lower
purchasing power.
Overall Mixed PGAS' strong 9M24 earnings were supported by improved GPM from a higher distribution spread and increased income
from associates. MEDC benefited from a 12% YoY rise in oil and gas sales and associate income, while AMMN saw an
808% YoY increase in net profit, though this gain was partially offset by TransAsia Pipeline's losses. ELSA's earnings
grew due to higher upstream segment performance, with EBIT margin rising to 7%, while AKRA's weaker results were
attributed to reduced mining activity from permit delays, a 5% drop in petroleum sales, and a 29% YoY decline in trading
gross profit amid lower market purchasing power.
Source: Company data, RHB

See important disclosures at the end of this report

17
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Cement & building materials: Mixed results; SMGR struggles amid oversupply,
INTP benefits from seasonality, ARNA shows steady growth
The cement & building materials sector had a mixed performance. While Semen Indonesia
(SMGR IJ, TRADING BUY, TP: IDR5,300) struggled with industry-wide oversupply and pricing
pressures, Indocement (INTP IJ, BUY, TP: IDR8,500) showed strength from seasonality but
faced normalisation risks, and Arwana Citramulia (ARNA IJ, BUY, TP: IDR870) maintains
steady growth with stable ASPs. The sector's outlook remains cautious, with expected
pressures on ASPs and potential demand fluctuations due to seasonal factors.
SMGR underperformed, achieving only 32% and 37% of our and consensus FY24 estimates
due to an industry-wide oversupply of cement capacity, which led to lower blended ASPs
despite a mid-year price hike. 9M24 earnings fell 58% YoY, reflecting ongoing pressures from
an unfavourable sales mix and competition. SMGR's earnings outlook remains cautious due to
potential further ASP challenges.
INTP delivered stronger 3Q24 results, with earnings increasing by 215.7% QoQ – meeting
expectations, as seasonality factors boosted sales. However, concerns remain over lower
blended ASPs, and 4Q24 earnings may normalise due to the year-end rainy season impact on
sales volume. 9M24 earnings reached 66% and 68% of our and consensus FY24 estimates,
demonstrating relative stability in a challenging market.
ARNA’s 9M24 performance was in line with expectations, achieving 70% of RHB's FY24
forecasts, supported by a recovery in sales volume and stable blended ASPs. The company
recorded a 14.6% QoQ increase in earnings for 3Q24, with steady demand across its product
mix. ARNA’s resilience in a competitive landscape has been attributed to its effective sales
recovery strategy and a favourable sales mix.

Figure 27: Cement & building materials’ 3Q24 results highlights (IDRbn)
(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %-RHB FY24F %- Note
RHB Cons Cons
SMGR 846 30 218 634.5% -74.2% 1,714 720 -58.0% 2,233 32% 1,970 37% Below
INTP 568 197 621 215.7% 9.3% 1,267 1,056 -16.7% 1,597 66% 1,546 68% Inline
ARNA 109 98 113 14.6% 3.3% 353 316 -10.4% 451 70% 429 74% Inline
Total 1,523 325 952 193.1% -37.5% 3,334 2,091 -37.3% 4,281 49% 3,945 53% Below
Source: Company data, RHB

Figure 28: Cement & building materials’ 3Q24 results commentary

(IDRbn) Note Key insights from the results analysis
SMGR Below Weak 9M24 earnings were driven by oversupply of cement capacity in the industry. We still see lower blended ASPs (from sales mix)
as a major risk despite the ASP hike SMGR initiated in the middle of this year.
INTP In line Strong results in 3Q24 were anticipated given seasonality factors. However, our concern on lower blended ASPs remains as a major
risk. We expect 4Q24 earnings to normalise on a QoQ basis, as sales volume may be impacted by the upcoming year-end rainy season.
ARNA In line 9M24 earnings were in line as we expected a recovery in sales volume that supported 3Q24 revenue (+19% QoQ, +14% YoY) – along
with stable blended ASP during the quarter (+2% QoQ, +1% YoY) following a steady sales mix between products. We still like the
company for its sales recovery story, and healthier competition landscape.
Overall Below SMGR’s weak 9M24 earnings were impacted by industry-wide cement oversupply and risks of lower blended ASPs despite a mid-
year price hike, while INTP’s strong 3Q24 results were seasonal, with 4Q24 earnings expected to normalise as year-end rains may
dampen sales volume. ARNA's 9M24 earnings are aligned with expectations, showing sales volume recovery and stable ASPs in
3Q24, with a positive outlook on its recovery and improved competitive landscape
Source: Company data, RHB

See important disclosures at the end of this report

18
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Property development: PWON gains from strong recurring income while CTRA
and BSDE face project delivery normalisation
Property development was a mixed bag, with overall in-line results. Pakuwon Jati (PWON IJ,
BUY, TP: IDR550) benefitted from strong recurring income, especially in the hospitality
segment, while Ciputra Development (CTRA IJ, BUY, TP: IDR1,330) and Bumi Serpong Damai
(BSDE IJ, BUY, TP: IDR1,430) faced normalisation in project delivery and handover schedules.
Outlook for the sector remains stable, but seasonal and project-specific factors may influence
future earnings.
PWON’s 3Q24 earnings grew 58.1% QoQ and 11.8% YoY, while 9M24 earnings reached 77%
and 79% of our and consensus FY24 estimates. The company benefited from a robust rise in
recurring income, primarily driven by strong performance in its hotel segment, aligning with
expectations and contributing to a record quarterly recurring income.
CTRA, however underperformed, with its 9M24 earnings reaching only 65% and 63% of our
and consensus FY24 forecasts, attributed to weaker revenue recognition in the residential
and shop-house segment. This was partly due to normalisation following a period of higher
project completion and handovers in 1H24, affecting the QoQ performance in 3Q24, which
saw a 54.6% decline.
BSDE’s 3Q24 earnings were mainly supported by residential sales, with commercial sales
normalising due to a slower handover period. While 9M24 earnings met expectations at 87%
and 77% of our and consensus FY24 estimates, profitability was impacted by a shift in sales
mix with a lower contribution from higher-margin commercial products.

Figure 29: Property development’s 3Q24 results highlights (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %- FY24F %- Note
RHB RHB Cons Cons
PWON (core 388 515 815 58.1% 109.9% 1,487 1,663 11.8% 2,167 77% 2,114 79% In line
earnings)
CTRA 402 546 248 -54.6% -38.3% 1,181 1,277 8.1% 1,965 65% 2,027 63% Below
BSDE 568 894 370 -58.6% -34.9% 1,770 2,702 52.7% 3,106 87% 3,509 77% In line
Total 1,358 1,956 1,433 -26.7% 5.5% 4,438 5,642 27.1 7,238 78% 7,650 74% In line
%
Source: Company data, RHB

Figure 30: Property development 3Q24 results commentary

Note Key insights from the results analysis
PWON (core In line 3Q24 earnings were driven by higher recurring revenue with the highest growth came from the hotel. This was in line with our
earnings) expectations – the company managed to book its highest recurring income of the quarter.
CTRA Below Weak 9M24 earnings were driven by normalising 3Q24 revenue due to lower revenue recognition in the residential and
shophouse segment, as well as apartments.
BSDE In line 3Q24 revenue was mainly supported by residential sales, while commercial sales normalised on slower handover period in 3Q24
vs 1H24. Profitability contracted on sales mix (lower contribution from commercial products that generate higher profitability).
Overall In line Normalising 3Q24 revenue mainly from seasonality in project delivery while recurring income showed robust growth following
higher demand in leisure activities, especially in the hotel segment.
Source: Company data, RHB

See important disclosures at the end of this report

19
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Plantation: LSIP thrives on favourable pricing and tax benefits, while AALI
struggles with high costs and weak production
Plantation’s 9M24 earnings reached 78% of our FY24 forecast, which was slightly above
expectations due to LSIP’s strong performance, despite Astra Agro Lestari (AALI IJ,
NEUTRAL, TP: IDR6,270) underperforming. LSIP outperformance was from favourable
pricing and tax benefits, while AALI faced challenges with weaker production and high costs.
The sector outlook is cautiously optimistic, as LSIP's strong fundamentals are likely to sustain
under current market conditions, while AALI may see improvement if production gains
materialise in 4Q24.
AALI reported lower-than-expected earnings, achieving only 76% and 70% of our and
consensus FY24F due to weaker FFB output and high unit costs. The company’s 3Q24
earnings declined by 16.3% QoQ and 50% YoY, reflecting ongoing operational challenges.
However, production may improve in 4Q24, although elevated unit costs could continue to
weigh on profitability.
In contrast, LSIP exceeded expectations with its 9M24 earnings reaching 90% of our FY24
estimate. The company’s strong performance was driven by robust CPO and PK prices, as well
as favourable tax rates and higher-than-expected interest income. 3Q24 YoY earnings grew
by 92.7%, demonstrating its ability to capitalise on favourable market conditions, particularly
with the higher CPO price environment and weaker USD.
LSIP’s strong earnings were further supported by a reduction in export tax structure, which,
combined with favourable market conditions, provided a significant boost to profitability. The
company’s positive outlook is expected to continue, benefiting from sustained CPO prices,
favourable tax environment, and reduced export taxes, which should help mitigate the impact
of any cost pressures. We revised up LSIP’s FY24F-26F earnings by 24%, 24%, and 21%, after
reducing our unit cost assumptions, raising interest income, and lowering effective tax rates.

Figure 31: Plantation’s 3Q24 results highlights (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %-RHB FY24F %- Note
RHB Cons Cons
AALI 410 245 205 -16.3% -50.0% 774 745 -3.7% 986 76% 1,066 70% Below
LSIP 219 261 422 61.7% 92.7% 466 895 92.1% 1,121 80% 990 90% Above
Total 629 506 627 23.9% -0.3% 1,240 1,640 32.3% 2,108 78% 2,056 80% Above
Note: *) core profit
Source: Company data, RHB

Figure 32: Plantation’s 3Q24 results commentary

Note Key insights from the results analysis
AALI Below 9M24 earnings came in below our and consensus forecasts, dragged by weaker FFB output. We expect production to improve QoQ in
4Q24, although unit costs may remain elevated.
LSIP Above Strong 9M24 earnings were driven by robust CPO and PK prices, as well as higher-than-anticipated interest income and favourable tax
rate. We expect LSIP’s earnings to remain robust thanks to the higher CPO price environment, depreciation of the USD, and reduction in
export tax structure.
Overall Above AALI's 9M24 earnings lagged expectations due to weaker FFB output, with potential production gains in 4Q24 despite high unit
costs, while LSIP’s strong earnings were supported by high CPO and PK prices, increased interest income, and favourable tax rates,
which are expected to sustain under favourable CPO prices, a weaker USD, and lower export taxes.
Source: Company data, RHB

See important disclosures at the end of this report

20
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Infrastructure: JSMR's yearly growth bolstered by tariff increases amid seasonal

traffic variability
While Infrastructure experienced a seasonal dip in earnings from the previous quarter, the
YoY growth driven by tariff increases points to a solid foundation for future revenue stability.
Jasa Marga’s (JSMR) in line earnings also indicates effective management of traffic and pricing
dynamics within the sector.
9M24 earnings reached 75% and 76% of our and consensus forecasts – within expectations.
The company's revenue and earnings were impacted by seasonal traffic patterns, but the YoY
improvement highlights the positive effect of tariff increases. The higher tariffs have provided
a steady boost to earnings, offsetting the typical fluctuations in traffic volume.
The outlook for the infrastructure sector, particularly for JSMR, appears stable as the
company continues to benefit from tariff adjustments despite the seasonal variability in
traffic. The ability to maintain robust YoY growth, even with the QoQ decline, suggests that
JSMR's financial performance is supported by favourable pricing strategies.

Figure 33: Infrastructure’s 3Q24 results highlights (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %-RHB FY24F %- Note
RHB Cons Cons
JSMR (core 720 978 877 -10.3% 21.8% 1,817 2,446 34.6% 3,279 75% 3,206 76% In line
profit)
Total 720 978 877 -10.3% 21.8% 1,817 2,446 34.6% 3,279 75% 3,206 76% In line
Source: Company data, RHB

Figure 34: Infrastructure’s 3Q24 results commentary

(IDRbn) Note Key insights from the results analysis
JSMR (core In line Slower QoQ revenue and earnings were driven by normalizing traffic volume post-holiday season in 2Q while stronger YoY on higher
profit) tariff that the company enjoys (especially from special tariff adjustment).
Source: Company data, RHB

See important disclosures at the end of this report

21
Market Strategy Indonesia Strategy
8 November 2024 Market Outlook | Market Strategy

Pulp & Paper: Challenging times; INKP struggles with low pulp prices, FX losses,
and rising costs despite sales volume growth
Pulp & Paper is facing a challenging environment with pressures from lower pulp prices,
unfavourable FX movements, and rising operational costs. While Indah Kiat Pulp & Paper
INKP IJ, BUY, TP: IDR13,625) saw some growth in sales volume, the sector’s profitability
remains under strain, and future performance will likely depend on recovery in pulp prices and
stabilization of FX rates.
INKP's 9M24 core earnings reached 73% of our forecast, but only 60% of consensus FY24
estimates. The weaker-than-expected performance was attributed to a combination of
factors, including lower pulp prices, forex losses, and higher operational expenses. Despite
these challenges, the company did see some improvement in pulp sales volume, though it was
not enough to offset the negative impact in other areas.

Figure 35: Pulp & paper’s 3Q24 results highlights (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %- FY24F %- Note
RHB RHB Cons Cons
INKP (core profit) 19 97 104 7.2% 447.4% 350 293 -16.3% 404 73% 486 60% Below
(USDm)
Total (eq. IDRbn) 297 1,516 1,625 7.2% 447.4% 5,469 4,578 -16.3% 6,306 73% 7,592 60% Below
Source: Company data, RHB

Figure 36: Pulp & paper 3Q24 results commentary

Note Key insights from the results analysis
INKP (core Below Weak 9M24 earnings were driven by lower pulp prices, FX loss, and higher operational expenses, despite an improvement in
profit) pulp sales volume
Source: Company data, RHB

Renewable energy: KEEN's 9M24 earnings fell short of expectations amid

revenue decline in key assets
KEEN’s 9M24 earnings were below expectations, achieving only 64% of our FY24 estimates.
The outlook remains cautious, with a need for potential operational adjustments or
improvements in asset performance to align with forecasted growth. KEEN's
underperformance was largely due to declining revenue from its Pakkat and Air Putih assets
by 11% and 15% YoY, while net income dropped by 28% and 33% YoY. This contributed to the
overall shortfall in earnings.

Figure 37: Renewable energy’s 3Q24 results highlights (IDRbn)

(IDRbn) 3Q23 2Q24 3Q24 QoQ YoY 9M23 9M24 YoY FY24F %-RHB FY24F %- Note
RHB Cons Cons
KEEN 3 7 3 -55.4% -5.5% 13 13 1.0% 20 64% 20 64% Below
(USDm)
Total (eq. 49 103 46 -55.4% -5.5% 198 200 1.0% 313 64% 313 64% Below
IDRbn)
Source: Company data, RHB

Figure 38: Renewable energy’s 3Q24 results commentary

Note Key insights from the results analysis
KEEN Below KEEN's 9M24 earnings were below expectations at 64%, as Pakkat and Air Putih's net incomes dropped 28% and 33% YoY. Revenue was
declining on both assets: Pakkat and Air Putih’s numbers going down 11% and 15% YoY was the cause behind the below expectation
earnings.
Source: Company data, RHB

See important disclosures at the end of this report

22
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5. RHB Securities (Thailand) PCL did not receive compensation or benefit (including
This report was prepared by RHB is meant for distribution solely and directly to “major” gift and special cost arrangement e.g. company/issuer-sponsored and paid trip) in
U.S. institutional investors as defined under, and pursuant to, the requirements of Rule relation to the production of this report.
15a-6 under the U.S. Securities and Exchange Act of 1934, as amended (the “Exchange
Act”) via a registered U.S. broker-dealer as appointed by RHB from time to time. Indonesia
Accordingly, any access to this report via Bursa Marketplace or any other Electronic Save as disclosed in the following link RHB Research Conflict Disclosures - Nov 2024
Services Provider is not intended for any party other than “major” US institutional and to the best of our knowledge, PT RHB Sekuritas Indonesia hereby declares that:
investors (via a registered U.S broker-dealer), nor shall be deemed as solicitation by RHB 1. PT RHB Sekuritas Indonesia and its investment analysts, does not have any interest
in any manner. RHB is not registered as a broker-dealer in the United States and in the securities of the subject company(ies) covered in this report.
currently has not appointed a U.S. broker-dealer. Additionally, RHB does not offer For the avoidance of doubt, interest in securities include the following:
brokerage services to U.S. persons. Any order for the purchase or sale of all securities a) Holding directly or indirectly, individually or jointly own/hold securities or
discussed herein must be placed with and through a registered U.S. broker-dealer as entitled for dividends, interest or proceeds from the sale or exercise of the
appointed by RHB from time to time as required by the Exchange Act Rule 15a-6. For subject company’s securities covered in this report*;
avoidance of doubt, RHB reiterates that it has not appointed any U.S. broker-dealer b) Being bound by an agreement to purchase securities or has the right to transfer
during the issuance of this report. This report is confidential and not intended for the securities or has the right to pre subscribe the securities*.
distribution to, or use by, persons other than the recipient and its employees, agents and c) Being bound or required to buy the remaining securities that are not
advisors, as applicable. Additionally, where research is distributed via Electronic Service subscribed/placed out pursuant to an Initial Public Offering*.
Provider, the analysts whose names appear in this report are not registered or qualified d) Managing or jointly with other parties managing such parties as referred to in
as research analysts in the United States and are not associated persons of any (a), (b) or (c) above.
registered U.S. broker-dealer as appointed by RHB from time to time and therefore may 2. PT RHB Sekuritas Indonesia is not a market maker in the securities or capital market
not be subject to any applicable restrictions under Financial Industry Regulatory products of the subject company(ies) covered in this report.
Authority (“FINRA”) rules on communications with a subject company, public 3. None of PT RHB Sekuritas Indonesia’s staff** or associated person serve as a
appearances and personal trading. Investing in any non-U.S. securities or related director or board member* of the subject company(ies) covered in this report.
financial instruments discussed in this research report may present certain risks. The 4. PT RHB Sekuritas Indonesia did not receive compensation for investment banking
securities of non-U.S. issuers may not be registered with, or be subject to the regulations or corporate finance services from the subject company in the past 12 months.
of, the U.S. Securities and Exchange Commission. Information on non-U.S. securities or 5. PT RHB Sekuritas Indonesia** did not receive compensation or benefit (including
related financial instruments may be limited. Foreign companies may not be subject to gift and special cost arrangement e.g. company/issuer-sponsored and paid trip) in
audit and reporting standards and regulatory requirements comparable to those in the relation to the production of this report:
United States. The financial instruments discussed in this report may not be suitable for
all investors. Transactions in foreign markets may be subject to regulations that differ Notes:
from or offer less protection than those in the United States. *The overall disclosure is limited to information pertaining to PT RHB Sekuritas Indonesia only.
**The disclosure is limited to Research staff of PT RHB Sekuritas Indonesia only.
DISCLOSURE OF CONFLICTS OF INTEREST Singapore
RHB Investment Bank Berhad, its subsidiaries (including its regional offices) and Save as disclosed in the following link RHB Research Conflict Disclosures - Nov 2024
associated companies, (“RHBIB Group”) form a diversified financial group, undertaking and to the best of our knowledge, the Singapore Research department of RHB Bank
various investment banking activities which include, amongst others, underwriting, Berhad (through its Singapore branch) hereby declares that:
securities trading, market making and corporate finance advisory. 1. RHB Bank Berhad, its subsidiaries and/or associated companies do not make a
market in any issuer covered by the Singapore research analysts in this report.
As a result of the same, in the ordinary course of its business, any member of the RHBIB
2. RHB Bank Berhad, its subsidiaries and/or its associated companies and its analysts
Group, may, from time to time, have business relationships with, hold any positions in
do not have a financial interest (including a shareholding of 1% or more) in the
the securities and/or capital market products (including but not limited to shares,
issuer covered by the Singapore research analysts in this report.
warrants, and/or derivatives), trade or otherwise effect transactions for its own account
3. RHB Bank Berhad’s Singapore research staff or connected persons do not serve
or the account of its customers or perform and/or solicit investment, advisory or other
on the board or trustee positions of the issuer covered by the Singapore research
services from any of the subject company(ies) covered in this research report.
analysts in this report.
While the RHBIB Group will ensure that there are sufficient information barriers and 4. RHB Bank Berhad, its subsidiaries and/or its associated companies do not have
internal controls in place where necessary, to prevent/manage any conflicts of interest and have not within the last 12 months had any corporate finance advisory
to ensure the independence of this report, investors should also be aware that such relationship with the issuer covered by the Singapore research analysts in this
conflict of interest may exist in view of the investment banking activities undertaken by report or any other relationship that may create a potential conflict of interest.
the RHBIB Group as mentioned above and should exercise their own judgement before 5. RHB Bank Berhad’s Singapore research analysts, or person associated or
making any investment decisions. connected to it do not have any interest in the acquisition or disposal of, the
In Singapore, investment research activities are conducted under RHB Bank Berhad securities, specified securities based derivatives contracts or units in a collective
(through its Singapore branch), and the disclaimers above similarly apply. investment scheme covered by the Singapore research analysts in this report.
6. RHB Bank Berhad’s Singapore research analysts do not receive any compensation
Malaysia or benefit in connection with the production of this research report or
Save as disclosed in the following link RHB Research Conflict Disclosures - Nov 2024 recommendation on the issuer covered by the Singapore research analysts.
and to the best of our knowledge, RHBIB hereby declares that:
1. RHBIB does not have a financial interest in the securities or other capital market Analyst Certification
products of the subject company(ies) covered in this report. The analyst(s) who prepared this report, and their associates hereby, certify that:
2. RHBIB is not a market maker in the securities or capital market products of the (1) they do not have any financial interest in the securities or other capital market
subject company(ies) covered in this report. products of the subject companies mentioned in this report, except for:
3. None of RHBIB’s staff or associated person serve as a director or board member* of
the subject company(ies) covered in this report Analyst Company
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(2) no part of his or her compensation was, is or will be directly or indirectly related to
the specific recommendations or views expressed in this report.

KUALA LUMPUR JAKARTA

RHB Investment Bank Bhd PT RHB Sekuritas Indonesia
Level 3A, Tower One, RHB Centre Revenue Tower, 11th Floor, District 8 - SCBD
Jalan Tun Razak Jl. Jendral Sudirman Kav 52-53
Kuala Lumpur 50400 Jakarta 12190
Malaysia Indonesia
Tel : +603 2302 8100 Tel : +6221 509 39 888
Fax : +603 2302 8134 Fax : +6221 509 39 777

BANGKOK SINGAPORE
RHB Securities (Thailand) PCL RHB Bank Berhad (Singapore branch)
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98, North Sathorn Road, Silom #04-00 RHB Bank Building
Bangrak, Bangkok 10500 Singapore 069531
Thailand Fax: +65 6509 0470
Tel: +66 2088 9999
Fax :+66 2088 9799

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