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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<li>
<a href="https://www.smartkarma.com/entities/kalbe-farma-tbk-pt" target="_blank" data-smartkarma-citation="entities:6303:1" rel="noopener">Kalbe Farma (KLBF IJ)</a> continued to experience a high post-COVID base effect in 3Q2023, with consumer habits shifting to leisure versus health plus there was a softening of consumer demand.</li>
<li>The company also experienced higher raw material prices and higher operating expenses which depressed margins but expectations are for a recovery in margins in 4Q2023 and FY2024. </li>
<li>
<a href="https://www.smartkarma.com/entities/kalbe-farma-tbk-pt" target="_blank" data-smartkarma-citation="entities:6303:1" rel="noopener">Kalbe Farma</a> stands out as Indonesia's largest pharmaceutical company with strong exposure to consumer health and nutritional products with rising health consciousness amongst Indonesians. Valuations do not reflect impending recovery.</li>
</ul>



Kalbe Farma (KLBF IJ) continued to experience a high post-COVID base effect in 3Q2023, with consumer habits shifting to leisure versus health plus there was a softening of consumer demand.
The company also experienced higher raw material prices and higher operating expenses which depressed margins but expectations are for a recovery in margins in 4Q2023 and FY2024. 

Kalbe Farma stands out as Indonesia's largest pharmaceutical company with strong exposure to consumer health and nutritional products with rising health consciousness amongst Indonesians. Valuations do not reflect impending recovery.


Kalbe Farma (KLBF IJ) - The End of a Long Transition

External broker reports(aggregated public sources), BRI Danareksa Research

BRI Danareksa Research

External broker reports(aggregated public sources)

As a one-stop financial solution with the vision to be the most valuable securities house, BRI Danareksa Sekuritas (BRIDS) has maintained an excellent track record and extensive experience in the capital market as an underwriter, broker, and financial advisor for individual, institutional, foreign and domestic, private and government clients. Established in 1992, PT Danareksa Sekuritas is a securities company that performs activities as a securities broker, underwriter, or arranger and financial advisor.

<ul><li>We are turning more cautious on KLBF’s FY23-25F EPS growth as we see threat for its branded prescription drugs from the persisting rising trend of hospital patients visits from JKN patients in 9M23 (17% CAGR in 2014-22).</li><li>Against this headwind, we project a lower FY24F earnings growth of 2.9% yoy (21-27% cut in FY23-25F est.) and cut our rating to HOLD with a lower TP of IDR1,600.</li><li>Hospital operators MIKA, HEAL and SILO have reported further increase in revenue portion from JKN patients in 9M23, continuing the trend from the past few years (data shown by National Health Program/ BPJS that showed 17% CAGR in 2014-22 (34% in FY22) increase in total number of visits by JKN patients to healthcare facilities.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

We are turning more cautious on KLBF’s FY23-25F EPS growth as we see threat for its branded prescription drugs from the persisting rising trend of hospital patients visits from JKN patients in 9M23 (17% CAGR in 2014-22).Against this headwind, we project a lower FY24F earnings growth of 2.9% yoy (21-27% cut in FY23-25F est.) and cut our rating to HOLD with a lower TP of IDR1,600.Hospital operators MIKA, HEAL and SILO have reported further increase in revenue portion from JKN patients in 9M23, continuing the trend from the past few years (data shown by National Health Program/ BPJS that showed 17% CAGR in 2014-22 (34% in FY22) increase in total number of visits by JKN patients to healthcare facilities.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Kalbe Farma (KLBF IJ) - Persisting Headwind in FY24 from Shifting Industry Trend

Cross Asset Strategy

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<li>Indonesia has been the recipient of significant investment flows for foreign investors with more of a "risk on" environment with a large portion flowing into Indonesian banks. </li>
<li>Indonesia stacks up from an investment perspective with a stable political environment, solid GDP growth of around 5% YoY, rising flows of FDI, and a more stable IDR.</li>
<li>Despite the JCI knocking on all-time highs, valuations continue to look attractive with prospects of a better 2H2024 and lower interest rates. Top picks: Banks, property, consumer, and selective elsewhere. </li>
</ul>


Indonesia has been the recipient of significant investment flows for foreign investors with more of a "risk on" environment with a large portion flowing into Indonesian banks. 
Indonesia stacks up from an investment perspective with a stable political environment, solid GDP growth of around 5% YoY, rising flows of FDI, and a more stable IDR.
Despite the JCI knocking on all-time highs, valuations continue to look attractive with prospects of a better 2H2024 and lower interest rates. Top picks: Banks, property, consumer, and selective elsewhere. 


Indonesia Strategy - Caught in a Perfect Updraft?

Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

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<a href="https://www.smartkarma.com/entities/first-pacific-co-ltd" target="_blank" data-smartkarma-citation="entities:173:1" rel="noopener">First Pacific Co (142 HK)</a> is a Southeast Asian conglomerate that has been handicapped by its listing in the Hong Kong market over the last several years.</li>
<li>As Southeast Asian markets (Indonesia and Philippines) begin to re-rate on the back of a more accommodating Fed policy, First Pacific is beginning to participate in the uptrend.</li>
<li>Metro Pacific Investments Corp (MPIC), the second largest piece of the company's NAV has been active in acquiring more infrastructure assets since being privatized last year.</li>
</ul>



First Pacific Co (142 HK) is a Southeast Asian conglomerate that has been handicapped by its listing in the Hong Kong market over the last several years.
As Southeast Asian markets (Indonesia and Philippines) begin to re-rate on the back of a more accommodating Fed policy, First Pacific is beginning to participate in the uptrend.
Metro Pacific Investments Corp (MPIC), the second largest piece of the company's NAV has been active in acquiring more infrastructure assets since being privatized last year.


BUY: First Pacific Company (142 HK): Right Stock Trapped in the Wrong Market

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

Cisarua Mountain Dairy / Equity Capital Markets

<ul>
<li>PT Cisarua Mountain Dairy (CMD), a producer of dairy and consumer foods, aims to raise up to US$263m in its Indonesian IPO.</li>
<li>It is a market leader in the overall yogurt sub-category as well as in the spoonable and drinking yogurt segments with a market share of 53.2%, 71.9% and 50.3%, respectively. </li>
<li>In our previous notes, links <a href="https://www.smartkarma.com/insights/cisarua-mountain-dairy-cimory-ipo-the-negatives-losing-market-share-margin-sustainability" target="_blank" rel="noopener">here</a> and <a href="https://www.smartkarma.com/insights/cisarua-mountain-dairy-cimory-ipo-the-negatives-losing-market-share-margin-sustainability" target="_blank" rel="noopener">here</a>,  we spoke about the various aspects of the deal. In we will do a peer comparison and talk about valuations.</li>
</ul>


PT Cisarua Mountain Dairy (CMD), a producer of dairy and consumer foods, aims to raise up to US$263m in its Indonesian IPO.
It is a market leader in the overall yogurt sub-category as well as in the spoonable and drinking yogurt segments with a market share of 53.2%, 71.9% and 50.3%, respectively. 
In our previous notes, links here and here,  we spoke about the various aspects of the deal. In we will do a peer comparison and talk about valuations.


Cisarua Mountain Dairy  (Cimory) IPO - Giving It the Benefit of Margin Doubts

Indonesia

PT Kalbe Farma Tbk produces and develops pharmaceutical products for human and animal healthcare.  Through its subsidiaries, the Company also operates in the pharmaceutical, health food, and packaging industries.

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Kalbe Farma (KLBF IJ)