ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Equity Bottom-Up

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<a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> FY2021 results reflect a rapid recovery in its core auto business plus commodity-related businesses, with +96% YoY net profit growth stripping out <a href="https://www.smartkarma.com/entities/bank-permata-tbk-pt" target="_blank" data-smartkarma-citation="entities:728:1" rel="noopener">Bank Permata (BNLI IJ)</a>. </li>
<li>The auto and related finance businesses should continue to perform well in 2022, with government luxury tax stimulus measures in place plus commodity prices will support <a href="https://www.smartkarma.com/entities/united-tractors-tbk-pt" target="_blank" data-smartkarma-citation="entities:698:1" rel="noopener">United Tractors'</a> performance.  </li>
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<a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> remains a top pick for the economic recovery in Indonesia plus the company continues to look for investment opportunities to redeploy funds raised from Permata sales.</li>
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Astra International (ASII IJ) FY2021 results reflect a rapid recovery in its core auto business plus commodity-related businesses, with +96% YoY net profit growth stripping out Bank Permata (BNLI IJ). 
The auto and related finance businesses should continue to perform well in 2022, with government luxury tax stimulus measures in place plus commodity prices will support United Tractors' performance.  

Astra International (ASII IJ) remains a top pick for the economic recovery in Indonesia plus the company continues to look for investment opportunities to redeploy funds raised from Permata sales.


Astra International (ASII IJ) - Rock Solid

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<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> just released a strong set of 3Q2021 results with its EPS up by +84% YoY (excluding <a href="https://www.smartkarma.com/entities/bank-permata-tbk-pt" target="_blank" data-smartkarma-citation="entities:728:1" rel="noopener">Bank Permata (BNLI IJ)</a> sales), driven by a significant improvement in auto and motorcycle sales.</p>
<p>The company also saw the benefit of rising commodity prices, especially for <a href="https://www.smartkarma.com/entities/united-tractors-tbk-pt" target="_blank" data-smartkarma-citation="entities:698:1" rel="noopener">United Tractors (UNTR IJ)</a> and for <a href="https://www.smartkarma.com/entities/astra-agro-lestari-tbk-pt" target="_blank" data-smartkarma-citation="entities:4050:1" rel="noopener">Astra Agro Lestari (AALI IJ)</a>. Management remains optimistic on the outlook for the rest of the year, with the backdrop of a strong balance sheet.</p>
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<section class="figure">The company's overall revenues for 9M2021 came in at IDR167.4 tn, or an increase of +28% YoY, with net income hitting IDR15tn, an increase of +7% YoY versus 9M2020.</section>
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<section class="figure">Net income from the group's auto division was a key driver for the results with net income up by +207% YoY mainly due to a low base last year in 2Q given the impact of COVID-19 and related mobility measures. The segment also benefitted from the temporary luxury sales tax incentives this year, which has boosted demand.</section>
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<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a>'s financial services division also saw better performance with a higher contribution from consumer finance, heavy equipment finance and the general insurance businesses.</p>
<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener"></a>The group's heavy equipment business, mining, construction, and energy division booked an increase of +51% YoY mainly due to better heavy equipment sales and higher coal prices, with a strong performance from <a href="https://www.smartkarma.com/entities/united-tractors-tbk-pt" target="_blank" data-smartkarma-citation="entities:698:1" rel="noopener">United Tractors (UNTR IJ)</a>. </p>
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<p>The group's agribusiness under 79.7%-owned <a href="https://www.smartkarma.com/entities/astra-agro-lestari-tbk-pt" target="_blank" data-smartkarma-citation="entities:4050:1" rel="noopener">Astra Agro Lestari (AALI IJ)</a> had a very strong performance for 9M2021 with net income increasing by +152% YoY.</p>
<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a>'s infrastructure and logistics division also reported a strong recovery for 9M2021, driven by an improved performance from the toll road business and its Serasi Autoraya business.</p>
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<p>The group's balance sheet remains strong and puts the company in a good position to look for potential acquisitions if the right opportunity arose. This could potentially occur in the digital space, given its recent moves into that segment. We remain positive on the outlook for <a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> and it continues to be one of our top picks for the recovery in Indonesia, which is already taking shape.</p>
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Astra International (ASII IJ) just released a strong set of 3Q2021 results with its EPS up by +84% YoY (excluding Bank Permata (BNLI IJ) sales), driven by a significant improvement in auto and motorcycle sales.
The company also saw the benefit of rising commodity prices, especially for United Tractors (UNTR IJ) and for Astra Agro Lestari (AALI IJ). Management remains optimistic on the outlook for the rest of the year, with the backdrop of a strong balance sheet.

The company's overall revenues for 9M2021 came in at IDR167.4 tn, or an increase of +28% YoY, with net income hitting IDR15tn, an increase of +7% YoY versus 9M2020.



Net income from the group's auto division was a key driver for the results with net income up by +207% YoY mainly due to a low base last year in 2Q given the impact of COVID-19 and related mobility measures. The segment also benefitted from the temporary luxury sales tax incentives this year, which has boosted demand.




Astra International (ASII IJ)'s financial services division also saw better performance with a higher contribution from consumer finance, heavy equipment finance and the general insurance businesses.
The group's heavy equipment business, mining, construction, and energy division booked an increase of +51% YoY mainly due to better heavy equipment sales and higher coal prices, with a strong performance from United Tractors (UNTR IJ). 


The group's agribusiness under 79.7%-owned Astra Agro Lestari (AALI IJ) had a very strong performance for 9M2021 with net income increasing by +152% YoY.
Astra International (ASII IJ)'s infrastructure and logistics division also reported a strong recovery for 9M2021, driven by an improved performance from the toll road business and its Serasi Autoraya business.

The group's balance sheet remains strong and puts the company in a good position to look for potential acquisitions if the right opportunity arose. This could potentially occur in the digital space, given its recent moves into that segment. We remain positive on the outlook for Astra International (ASII IJ) and it continues to be one of our top picks for the recovery in Indonesia, which is already taking shape.




Astra International (ASII IJ) - Driven by Autos and Commodities

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<p>We attended an analyst call with <a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ),</a> which revealed more colour behind the company's results, as well as further pointers to its longer-term strategy, especially in relation to its digital strategy both for its existing as well as new business direction.</p>
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<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> registered a strong performance in 1H2021, driven by the recovering economy, government stimulus, and higher commodity prices. </p>
<p><a href="https://www.smartkarma.com/entities/united-tractors-tbk-pt" target="_blank" data-smartkarma-citation="entities:698:1" rel="noopener">United Tractors (UNTR IJ)</a> had a strong first half of the year with Komatsu sales growth of +60% YoY to 1,360 with additional strong growth in parts and service revenues</p>
<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> recently released its car sales numbers for August, which revealed a rapid recovery in numbers after a dip in July due to Emergency PPKM measures.</p>
<p>We would expect continuing strong momentum behind car sales given the extension of the cut in luxury tax due to the recent wave of COVID-19 measures until December.</p>
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<p>In the 2W space, Astra Honda saw around an -8% decline in motorcycle sales in July but continues to expect towards the end of the year.</p>
<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> continues to work on the digitalization of all its various businesses and management identifies distinct themes in its digitalisation efforts both internally and externally.</p>
<p>The company is also looking at developing its EV (electric vehicle) capabilities and will develop this EV strategy over the next 12-18 months building the local portion of the value chain.</p>
<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> is also very focused on its ESG efforts across its very broad array of businesses both through reporting and sustainability efforts.</p>
<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> continues to be one of our top recovery picks, with recent car sales numbers suggesting a strong recovery is looming, with a fair tailwind from luxury tax omission. It should also continue to benefit from higher commodity prices through <a href="https://www.smartkarma.com/entities/united-tractors-tbk-pt" target="_blank" data-smartkarma-citation="entities:698:1" rel="noopener">United Tractors (UNTR IJ)</a> and we see the potential for further investments to come in the new economy.</p>


We attended an analyst call with Astra International (ASII IJ), which revealed more colour behind the company's results, as well as further pointers to its longer-term strategy, especially in relation to its digital strategy both for its existing as well as new business direction.

Astra International (ASII IJ) registered a strong performance in 1H2021, driven by the recovering economy, government stimulus, and higher commodity prices. 
United Tractors (UNTR IJ) had a strong first half of the year with Komatsu sales growth of +60% YoY to 1,360 with additional strong growth in parts and service revenues
Astra International (ASII IJ) recently released its car sales numbers for August, which revealed a rapid recovery in numbers after a dip in July due to Emergency PPKM measures.
We would expect continuing strong momentum behind car sales given the extension of the cut in luxury tax due to the recent wave of COVID-19 measures until December.



In the 2W space, Astra Honda saw around an -8% decline in motorcycle sales in July but continues to expect towards the end of the year.
Astra International (ASII IJ) continues to work on the digitalization of all its various businesses and management identifies distinct themes in its digitalisation efforts both internally and externally.
The company is also looking at developing its EV (electric vehicle) capabilities and will develop this EV strategy over the next 12-18 months building the local portion of the value chain.
Astra International (ASII IJ) is also very focused on its ESG efforts across its very broad array of businesses both through reporting and sustainability efforts.
Astra International (ASII IJ) continues to be one of our top recovery picks, with recent car sales numbers suggesting a strong recovery is looming, with a fair tailwind from luxury tax omission. It should also continue to benefit from higher commodity prices through United Tractors (UNTR IJ) and we see the potential for further investments to come in the new economy.

Astra International (ASII IJ) - Future Clarity Through Digital Means

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Jardine Matheson Southeast Asia / Event-Driven

Jardine Matheson Southeast Asia (JCNC SP)

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<p><em><strong>This week in StubWorld ...</strong></em></p>
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<p><a href="https://www.smartkarma.com/entities/jardine-cycle-carriage-ltd" target="_blank" data-smartkarma-citation="entities:347:1" rel="noopener">Jardine Cycle &amp; Carriage (JCNC SP)</a>, relative to <a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a>, is around record-lows outside the Covid-affect low last year. This is occurring amid recent corporate developments within the Jardine stable of companies.</p>
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<p>Preceding my comments on JCNC are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
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<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
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This week in StubWorld ...



Jardine Cycle &amp; Carriage (JCNC SP), relative to Astra International (ASII IJ), is around record-lows outside the Covid-affect low last year. This is occurring amid recent corporate developments within the Jardine stable of companies.



Preceding my comments on JCNC are the weekly setup/unwind tables for Asia-Pacific Holdcos.


These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.


<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> announced its 1H2021 results with sales increasing by +20% YoY and headline net profit decreasing by -22% YoY but removing the impact of the <a href="https://www.smartkarma.com/entities/bank-permata-tbk-pt" target="_blank" data-smartkarma-citation="entities:728:1" rel="noopener">Bank Permata (BNLI IJ)</a> sale last year, net profit increased by an impressive +61% YoY.</p>
<p>The better numbers were driven by a strong improvement in the auto business, with car sales up +50% YoY and motorcycle sales +29% YoY.</p>
<p>The group was also a beneficiary of higher commodity prices in 1H2021, which boosted the performance of its heavy equipment and mining business under <a href="https://www.smartkarma.com/entities/united-tractors-tbk-pt" target="_blank" data-smartkarma-citation="entities:698:1" rel="noopener">United Tractors (UNTR IJ)</a> and its agribusiness under <a href="https://www.smartkarma.com/entities/astra-agro-lestari-tbk-pt" target="_blank" data-smartkarma-citation="entities:4050:1" rel="noopener">Astra Agro Lestari (AALI IJ)</a>, which saw net profit +14% YoY and +66% YoY respectively.  </p>
<p>The group consumer finance business saw a +13% increase in the amounts financed with an increase of +2% in net profit growth. Car finance saw a +2% increase and motorcycle finance a +3% YoY increase in net profit, while heavy equipment finance saw a +46% increase in the amounts financed by a -20% decrease in contribution due to a reduced loan portfolio. </p>
<p><a href="https://www.smartkarma.com/entities/united-tractors-tbk-pt" target="_blank" data-smartkarma-citation="entities:698:1" rel="noopener">United Tractors (UNTR IJ) </a>saw a +13% increase in net income with a +60% increase in Komatsu heavy equipment sales and helped by higher coal prices. <a href="https://www.smartkarma.com/entities/astra-agro-lestari-tbk-pt" target="_blank" data-smartkarma-citation="entities:4050:1" rel="noopener">Astra Agro Lestari (AALI IJ)</a>saw a boost from higher crude palm oil prices, which rose +29% in 1H2021.</p>
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<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> remains relatively cautious on the outlook given the current wave of COVID-19 cases but the company is well-positioned to weather any delay in an economic recovery but also to take advantage of any potential opportunities, given its rock-solid balance sheet. <a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> is trading on 10.6x FY2021E PER and 9.1x FY2022E PER versus its 5-year average forward PER of 14.2x, making it attractive from a valuation perspective. It remains one of our top recovery picks for Indonesia, given its exposure to autos, motorcycles, consumer finance, heavy equipment, and commodities.</p>
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Astra International (ASII IJ) announced its 1H2021 results with sales increasing by +20% YoY and headline net profit decreasing by -22% YoY but removing the impact of the Bank Permata (BNLI IJ) sale last year, net profit increased by an impressive +61% YoY.
The better numbers were driven by a strong improvement in the auto business, with car sales up +50% YoY and motorcycle sales +29% YoY.
The group was also a beneficiary of higher commodity prices in 1H2021, which boosted the performance of its heavy equipment and mining business under United Tractors (UNTR IJ) and its agribusiness under Astra Agro Lestari (AALI IJ), which saw net profit +14% YoY and +66% YoY respectively.  
The group consumer finance business saw a +13% increase in the amounts financed with an increase of +2% in net profit growth. Car finance saw a +2% increase and motorcycle finance a +3% YoY increase in net profit, while heavy equipment finance saw a +46% increase in the amounts financed by a -20% decrease in contribution due to a reduced loan portfolio. 
United Tractors (UNTR IJ) saw a +13% increase in net income with a +60% increase in Komatsu heavy equipment sales and helped by higher coal prices. Astra Agro Lestari (AALI IJ)saw a boost from higher crude palm oil prices, which rose +29% in 1H2021.

Astra International (ASII IJ) remains relatively cautious on the outlook given the current wave of COVID-19 cases but the company is well-positioned to weather any delay in an economic recovery but also to take advantage of any potential opportunities, given its rock-solid balance sheet. Astra International (ASII IJ) is trading on 10.6x FY2021E PER and 9.1x FY2022E PER versus its 5-year average forward PER of 14.2x, making it attractive from a valuation perspective. It remains one of our top recovery picks for Indonesia, given its exposure to autos, motorcycles, consumer finance, heavy equipment, and commodities.


Astra International (ASII IJ) - Leaning into the Recovery

Indonesia

PT Bank Permata Tbk is a leading Indonesian commercial bank offering a comprehensive range of financial services, including retail and corporate banking products such as savings accounts, loans, credit cards, investments, and digital banking platforms. The bank provides solutions in conventional and Sharia-compliant formats, encompassing consumer banking, commercial banking, and wholesale banking segments. Headquartered in Jakarta, Indonesia, the company was founded in 1954.

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Bank Permata (BNLI IJ)

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Angus Mackintosh

Astra International (ASII IJ) - Driven by Autos and Commodities

We remain positive on the outlook for Astra International (ASII IJ) as it continues to benefit from strong auto sales and stronger commodity...

Angus Mackintosh

Astra International (ASII IJ) - Future Clarity Through Digital Means

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Angus Mackintosh

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David Blennerhassett

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Astra Internations remains one of our top recovery picks for Indonesia, given its exposure to autos, motorcycles, consumer finance, heavy...

Angus Mackintosh

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