Indonesian Equities | Buy-Side Investment Research

Defriansyah Has

Equity Bottom-Up

<ul>
<li>Indonesian thermal coal prices are trending higher, creating a constructive cyclical backdrop for domestic coal producers: <a href="https://www.smartkarma.com/entities/pt-indo-tambangraya-megah-tbk" target="_blank" data-smartkarma-citation="entities:15891:1" rel="noopener">Indo Tambangraya Megah (ITMG IJ)</a> &amp; <a href="https://www.smartkarma.com/entities/pt-bukit-asam-persero-tbk" target="_blank" data-smartkarma-citation="entities:1189:1" rel="noopener">Bukit Asam (PTBA IJ)</a> </li>
<li>
<a href="https://www.smartkarma.com/entities/pt-indo-tambangraya-megah-tbk" target="_blank" data-smartkarma-citation="entities:15891:1" rel="noopener">Indo Tambangraya Megah (ITMG IJ)</a> combines the lowest valuation with substantial net cash, while <a href="https://www.smartkarma.com/entities/pt-bukit-asam-persero-tbk" target="_blank" data-smartkarma-citation="entities:1189:1" rel="noopener">Bukit Asam (PTBA IJ)</a>  combines stronger observed cash conversion with deeper logistics and resource-duration advantages.</li>
<li>We test, through a forensic examination of business economics and a value-investing lens, which company, if either, can offer more than 25% upside from current prices.</li>
</ul>


Indonesian thermal coal prices are trending higher, creating a constructive cyclical backdrop for domestic coal producers: Indo Tambangraya Megah (ITMG IJ) &amp; Bukit Asam (PTBA IJ) 

Indo Tambangraya Megah (ITMG IJ) combines the lowest valuation with substantial net cash, while Bukit Asam (PTBA IJ)  combines stronger observed cash conversion with deeper logistics and resource-duration advantages.
We test, through a forensic examination of business economics and a value-investing lens, which company, if either, can offer more than 25% upside from current prices.


ITMG Vs PTBA: The Cheapest Way to Indonesian Coal Exposure

Smartkarma AI Primers, Smartkarma

αSK Primers

Smartkarma AI Primers

Smartkarma

Smartkarma unites the fragmented investment industry, connecting institutional investors, independent research providers, and corporates within a single network.

Research Reinvented

<ul>
 <li>State-owned enterprise (SOE) status provides a strategic advantage in managing Indonesia's vast coal reserves, but also exposes the company to government policy shifts and dividend expectations.</li>
 <li>A concerted push into downstream diversification, including mine-mouth power plants and coal gasification projects, is underway to mitigate long-term risks from the global energy transition and add value to its low-rank coal reserves.</li>
 <li>Financial performance is intrinsically linked to volatile global coal prices, with recent earnings and margins declining from cyclical peaks, underscoring the urgency of its diversification and cost-efficiency initiatives.</li>
</ul>This content is AI-generated and displayed for general informational purposes only. Please verify independently before use.


  State-owned enterprise (SOE) status provides a strategic advantage in managing Indonesia's vast coal reserves, but also exposes the company to government policy shifts and dividend expectations.
  A concerted push into downstream diversification, including mine-mouth power plants and coal gasification projects, is underway to mitigate long-term risks from the global energy transition and add value to its low-rank coal reserves.
  Financial performance is intrinsically linked to volatile global coal prices, with recent earnings and margins declining from cyclical peaks, underscoring the urgency of its diversification and cost-efficiency initiatives.
This content is AI-generated and displayed for general informational purposes only. Please verify independently before use.

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.

Thematic (Sector/Industry)

<ul><li>Macro Strategy: The Fed Tightens: Can BI Hold the Line? The curve prices in another hike, but historical patterns suggest a more measured yield adjustment than in 2022–23.</li><li>We revisit our study on Indonesia’s three differentials, finding that policy carry provides the strongest ST buffer.</li><li>Earlier hikes also strengthened BI’s policy buffer, allowing targeted measures to take priority rather than another rate hike. </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.

Macro Strategy: The Fed Tightens: Can BI Hold the Line? The curve prices in another hike, but historical patterns suggest a more measured yield adjustment than in 2022–23.We revisit our study on Indonesia’s three differentials, finding that policy carry provides the strongest ST buffer.Earlier hikes also strengthened BI’s policy buffer, allowing targeted measures to take priority rather than another rate hike. 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.

Macro Strategy: The Fed Tightens: Can BI Hold the Line?

<ul><li>Coal Valuation Mispricing Remains; Better Entry Post 2Q26 Earnings. 5M26 S-D was tighter, but not a full moderate shock; RKAB upward revision may release more supply in 2H26.</li><li>Prices likely normalize, but downside should be cushioned by DMO pull-forward and buyers’ inventory preference.</li><li>Maintain OW, downgrade tactical view to Neutral: DSI risk should ease, but 2Q26 EBITDA may be flattish for AADI and ITMG.S-D: tighter than a normal downcycle, but not a full moderate shock. </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.

Coal Valuation Mispricing Remains; Better Entry Post 2Q26 Earnings. 5M26 S-D was tighter, but not a full moderate shock; RKAB upward revision may release more supply in 2H26.Prices likely normalize, but downside should be cushioned by DMO pull-forward and buyers’ inventory preference.Maintain OW, downgrade tactical view to Neutral: DSI risk should ease, but 2Q26 EBITDA may be flattish for AADI and ITMG.S-D: tighter than a normal downcycle, but not a full moderate shock. 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.

Coal: Valuation Mispricing Remains; Better Entry Post 2Q26 Earnings (OVERWEIGHT)

Asia Pac ECM and Index Rebal, Shenton Research

Ke Yan, CFA, FRM

Asia Pac ECM and Index Rebal

Asia Pac IPO & Placement Research, China Biotech

Shenton Research

Shenton Research is an independent Asia Pacific equity specialist. Our quantitative research covers index rebalancing flows, alongside exchange data analytics accross Asia Pacific. On the equity capital markets side, we focus on Asia Pacific ECM, especially biotech and TMT. Our lead analyst is frequently cited by international media.

Quantitative Analysis

<ul>
<li>We analysed the earning revision of component stocks of MS-Indonesia in the past month.</li>
<li>We tabulated stocks with the top impact on index's EPS, stocks' EPS revision, and revenue revision.</li>
<li>We highlighted EPS revision on Barito Pacific, Bukit Asam, Adaro Andalan Indonesia, PT Indofood Sukses Makmur, Bank Central Asia, Merdeka Copper Gold.</li>
</ul>


We analysed the earning revision of component stocks of MS-Indonesia in the past month.
We tabulated stocks with the top impact on index's EPS, stocks' EPS revision, and revenue revision.
We highlighted EPS revision on Barito Pacific, Bukit Asam, Adaro Andalan Indonesia, PT Indofood Sukses Makmur, Bank Central Asia, Merdeka Copper Gold.


MS-Indonesia Index Earning Revision (Sep): Barito Pacific, Bukit Asam, Adaro Andalan Indonesia

Indonesia

PT Bukit Asam (Persero) Tbk is an Indonesian state-owned enterprise primarily engaged in coal mining activities, encompassing general surveying, exploration, exploitation, processing, refining, transportation, and trading of coal. The company also operates steam-fired power plants, manages special coal dock facilities, and provides services such as briquette processing, mining services, palm plantation and processing, and health services. It was founded in 1919 with the initiation of coal mining by the Dutch Colonial Government and is headquartered in Tanjung Enim, South Sumatra, Indonesia.

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Bukit Asam (PTBA IJ)

ITMG Vs PTBA: The Cheapest Way to Indonesian Coal Exposure

A stronger coal cycle does not automatically mean better equity returns. We dissect ITMG and PTBA through cash generation, mining economics and...

Defriansyah Has

Primer: Bukit Asam (PTBA IJ) - Aug 2026

State-owned enterprise (SOE) status provides a strategic advantage in managing Indonesia's vast coal reserves, but also exposes the company to...

αSK Primers

Macro Strategy: The Fed Tightens: Can BI Hold the Line?

The Fed Tightens: Can BI Hold the Line? The curve prices in another hike, but historical patterns suggest a more measured yield adjustment than in...

BRI Danareksa Research

Coal: Valuation Mispricing Remains; Better Entry Post 2Q26 Earnings (OVERWEIGHT)

Coal Valuation Mispricing Remains; Better Entry Post 2Q26 Earnings. 5M26 S-D was tighter, but not a full moderate shock; RKAB upward revision may...

BRI Danareksa Research

MS-Indonesia Index Earning Revision (Sep): Barito Pacific, Bukit Asam, Adaro Andalan Indonesia

We analyzed MS-Indonesia's consensus for Sep 2026 and highlighted changes of EPS in Barito Pacific (BRPT IJ), Bukit Asam (PTBA IJ), Adaro Andalan...

Ke Yan, CFA, FRM

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