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

Integra Indocabinet Tbk PT / Equity Bottom-Up

It is a good feeling to discover an Indonesian company, which is an industry leader with a strong brand, has a high-quality customer base, a long-term growth trajectory, and one that plays on the country's home advantages. I visited <a href="https://www.smartkarma.com/entities/integra-indocabinet-tbk-pt" target="_blank" data-smartkarma-citation="entities:27356:1" rel="noopener">Integra Indocabinet Tbk PT (WOOD IJ)</a> in Jakarta recently and found it just one of those rare companies. <a href="https://www.smartkarma.com/entities/integra-indocabinet-tbk-pt" target="_blank" data-smartkarma-citation="entities:27356:1" rel="noopener">Integra Indocabinet Tbk PT (WOOD IJ)</a> is the largest vertically integrated timber products company in Indonesia, with business activities ranging from forestry concession ownership, to manufacturing fully-assembled and knocked down furniture, to furniture retailing, and wooden building components. The company has one of the largest Forestry Stewardship Council (FSC) Certified forestry concessions in Indonesia, which supplies a good portion of its raw material needs. It has a well-developed manufacturing facility close to Surabaya, with the capability to manufacture high-quality furniture, knock-down furniture, and building components, with ample capacity to drive near term growth. It has a high-quality customer base in the us and Europe including Target, <a href="https://www.smartkarma.com/entities/costco-wholesale-corp" target="_blank" data-smartkarma-citation="entities:18404:1" rel="noopener">Costco Wholesale (COST US)</a>, <a href="https://www.smartkarma.com/entities/home-depot-inc" target="_blank" data-smartkarma-citation="entities:8399:1" rel="noopener">Home Depot Inc (HD US),</a> and <a href="https://www.smartkarma.com/entities/amazon-com-inc" target="_blank" data-smartkarma-citation="entities:409:1" rel="noopener">Amazon.com Inc (AMZN US),</a> as well as <a href="https://www.smartkarma.com/entities/ikea-of-sweden-ab" target="_blank" data-smartkarma-citation="entities:28050:1" rel="noopener">IKEA of Sweden AB (4168877Z SS)</a>, Zara Home, and H&amp;M Home, which underlines its ability to produce high quality products. It is diversifying its wooden building components into door frames, kitchen cabinets and blinds, which all have high growth prospects. China faces the possibility of anti-dumping duties on kitchen cabinets of up to 60%, which plays to WOOD's advantage.It is a beneficiary of the US/China Trade war, with Indonesian furniture imports attracting zero tariffs versus 25% for China. Indonesia only makes up 2% of furniture imports to the US versus 50% for China, which leaves significant scope for gaining market share.<a href="https://www.smartkarma.com/entities/integra-indocabinet-tbk-pt" target="_blank" data-smartkarma-citation="entities:27356:1" rel="noopener">Integra Indocabinet Tbk PT (WOOD IJ)</a> is a high-quality manufacturer in an area where Indonesia has a key advantage, especially versus China. It has high quality and relatively diverse customer base and a strong track record, with strong growth prospects ahead.  Factoring in +40% revenue growth in 2019 and a conservative +25% in 2020 with stable margins, <a href="https://www.smartkarma.com/entities/integra-indocabinet-tbk-pt" target="_blank" data-smartkarma-citation="entities:27356:1" rel="noopener">Integra Indocabinet Tbk PT (WOOD IJ)</a> does not look expensive on 11.7x FY20E PER, given its strong potential for growth from both exports, especially to the US, as well as a positive diversification in the company's product mix.

It is a good feeling to discover an Indonesian company, which is an industry leader with a strong brand, has a high-quality customer base, a long-term growth trajectory, and one that plays on the country's home advantages. I visited Integra Indocabinet Tbk PT (WOOD IJ) in Jakarta recently and found it just one of those rare companies. Integra Indocabinet Tbk PT (WOOD IJ) is the largest vertically integrated timber products company in Indonesia, with business activities ranging from forestry concession ownership, to manufacturing fully-assembled and knocked down furniture, to furniture retailing, and wooden building components. The company has one of the largest Forestry Stewardship Council (FSC) Certified forestry concessions in Indonesia, which supplies a good portion of its raw material needs. It has a well-developed manufacturing facility close to Surabaya, with the capability to manufacture high-quality furniture, knock-down furniture, and building components, with ample capacity to drive near term growth. It has a high-quality customer base in the us and Europe including Target, Costco Wholesale (COST US), Home Depot Inc (HD US), and Amazon.com Inc (AMZN US), as well as IKEA of Sweden AB (4168877Z SS), Zara Home, and H&amp;M Home, which underlines its ability to produce high quality products. It is diversifying its wooden building components into door frames, kitchen cabinets and blinds, which all have high growth prospects. China faces the possibility of anti-dumping duties on kitchen cabinets of up to 60%, which plays to WOOD's advantage.It is a beneficiary of the US/China Trade war, with Indonesian furniture imports attracting zero tariffs versus 25% for China. Indonesia only makes up 2% of furniture imports to the US versus 50% for China, which leaves significant scope for gaining market share.Integra Indocabinet Tbk PT (WOOD IJ) is a high-quality manufacturer in an area where Indonesia has a key advantage, especially versus China. It has high quality and relatively diverse customer base and a strong track record, with strong growth prospects ahead.  Factoring in +40% revenue growth in 2019 and a conservative +25% in 2020 with stable margins, Integra Indocabinet Tbk PT (WOOD IJ) does not look expensive on 11.7x FY20E PER, given its strong potential for growth from both exports, especially to the US, as well as a positive diversification in the company's product mix. 

Integra Indocabinet Tbk PT (WOOD IJ) - Flatpack Wonder - On the Ground in J-Town

Indonesia

PT Integra Indocabinet Tbk manufactures wood building materials. The Company offers home, office, and hotel furniture, doors and windows, and other related products. Integra Indocabinet serves customers in Indonesia.

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Integra Indocabinet Tbk PT (WOOD IJ) - Flatpack Wonder - On the Ground in J-Town

It is a good feeling to discover an Indonesian company, which is an industry leader with a strong brand, has a high-quality customer base, a...

Angus Mackintosh