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

<div class="content-highlight">
<a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> is well-known for its car leasing business in Indonesia, as one of the largest players in long-term car leasing through ASSA Rent, with around 13% market share. It is less well appreciated as a major player in logistics and for its technology-based express logistics company Anteraja, which services the booming e-commerce space in Indonesia. 
</div>
The company is also the no.1 used car auction player through JBA, with around 40% market share, providing a service for the majority of Indonesia's auto finance companies.
<a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> also has a complementary C2C online marketplace selling vehicles, which is connected to its used car and auction business. 
The company's core car rental business will see growth of +10-15% as the economy recovers but Anteraja will see stronger growth driving the top line to grow +25% in 2021. Management expects Anteraja to account for more than 50% of sales in 1-2 years. 
<a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> currently trades on an FY21E PER multiple of 20.1x and F22E PER of 16.9x, which does not look expensive given the potential digital transformation ahead.


Adi Sarana Armada (ASSA IJ) is well-known for its car leasing business in Indonesia, as one of the largest players in long-term car leasing through ASSA Rent, with around 13% market share. It is less well appreciated as a major player in logistics and for its technology-based express logistics company Anteraja, which services the booming e-commerce space in Indonesia. 

The company is also the no.1 used car auction player through JBA, with around 40% market share, providing a service for the majority of Indonesia's auto finance companies.
Adi Sarana Armada (ASSA IJ) also has a complementary C2C online marketplace selling vehicles, which is connected to its used car and auction business. 
The company's core car rental business will see growth of +10-15% as the economy recovers but Anteraja will see stronger growth driving the top line to grow +25% in 2021. Management expects Anteraja to account for more than 50% of sales in 1-2 years. 
Adi Sarana Armada (ASSA IJ) currently trades on an FY21E PER multiple of 20.1x and F22E PER of 16.9x, which does not look expensive given the potential digital transformation ahead. 

Adi Sarana Armada (ASSA IJ) - Auto Leasing, Logistics, and the Last Mile

<div class="content-highlight">
A 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> management revealed that it has seen the worst of it for its core auto division, with a gradual recovery underway for both its autos and motorbikes, where its market share is back to pre-COVID-19 levels at 52% and 75% respectively.  Most of the company's businesses have already started to see significant recoveries from COVID-19 and this momentum will continue into the end of the year and into 2021. Watch out for the increasing impact of digitalization and potential acquisitions utilizing the proceeds 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.
</div>
October may see slightly less positive car sales given a 2nd round of PSBB measures were in place for half the month and consumers delayed purchases in the hope that luxury tax would be removed, which did not happen. 
<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> financial services arm is seeing some recovery and has already made adequate provisioning.
The company has a rock-solid balance sheet post 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 but is considering a number of investment opportunities, potentially in the digital space where it has already invested in <a href="https://www.smartkarma.com/entities/gojek" target="_blank" data-smartkarma-citation="entities:25976:1" rel="noopener">Gojek (1379371D IJ)</a>.
<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 very focused on digitalizing its overall business with an "Astra Digital" department at head office focused on creating synergies across its businesses, as well as utilizing data analytics.
<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> is supported by its gold exposure, where this business is worth more than the rest of its businesses combined. 
<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 one of our top picks for the recovery in the Indonesian economy going into 2021. It trades on 12.7x FY21E PER, with EPS growth forecast at +9.5% and +20.6% for FY21E and FY22E respectively.


A call with Astra International (ASII IJ) management revealed that it has seen the worst of it for its core auto division, with a gradual recovery underway for both its autos and motorbikes, where its market share is back to pre-COVID-19 levels at 52% and 75% respectively.  Most of the company's businesses have already started to see significant recoveries from COVID-19 and this momentum will continue into the end of the year and into 2021. Watch out for the increasing impact of digitalization and potential acquisitions utilizing the proceeds of the Bank Permata (BNLI IJ) sale.

October may see slightly less positive car sales given a 2nd round of PSBB measures were in place for half the month and consumers delayed purchases in the hope that luxury tax would be removed, which did not happen. 
Astra International (ASII IJ) financial services arm is seeing some recovery and has already made adequate provisioning.
The company has a rock-solid balance sheet post the Bank Permata (BNLI IJ) sale but is considering a number of investment opportunities, potentially in the digital space where it has already invested in Gojek (1379371D IJ).
Astra International (ASII IJ) is very focused on digitalizing its overall business with an "Astra Digital" department at head office focused on creating synergies across its businesses, as well as utilizing data analytics.
United Tractors (UNTR IJ) is supported by its gold exposure, where this business is worth more than the rest of its businesses combined. 
Astra International (ASII IJ) remains one of our top picks for the recovery in the Indonesian economy going into 2021. It trades on 12.7x FY21E PER, with EPS growth forecast at +9.5% and +20.6% for FY21E and FY22E respectively.

Astra International (ASII IJ) - An Auto-Recovery Story with a Golden Digital Twist

<a href="https://www.smartkarma.com/entities/indomobil-sukses-internasional-tbk-pt" target="_blank" data-smartkarma-citation="entities:11738:1" rel="noopener">Indomobil Sukses Internasional (IMAS IJ)</a> has come back onto the investment radar as its growth strategy starts to take shape (with an obvious delay from COVID-19), with automotive, including trucks, heavy equipment, and autos, now making up more than 50% of sales. 
The company is the sole distributor for HINO Trucks, the leading large-size truck brand, with more than 50% market share in Indonesia and has now 100% of the Volvo distribution for the country. 
The company has also started to revive its Nissan auto business, increasing its stake in the distributor to 75%, giving <a href="https://www.smartkarma.com/entities/indomobil-sukses-internasional-tbk-pt" target="_blank" data-smartkarma-citation="entities:11738:1" rel="noopener">Indomobil Sukses Internasional (IMAS IJ)</a> a higher vested interest in the brand's success. It has also expanded the number of Suzuki dealers and is now the sole distributor for KIA in Indonesia. 
Indombil is one of Indonesia's largest multi finance companies, with a greater exposure to commercial vehicles than its peers, which makes it relatively defensive. Indorent is Indonesia's No.3 car leasing player and has been relatively defensive through the pandemic period. 
<a href="https://www.smartkarma.com/entities/indomobil-sukses-internasional-tbk-pt" target="_blank" data-smartkarma-citation="entities:11738:1" rel="noopener">Indomobil Sukses Internasional (IMAS IJ)</a>  has also significantly grown in its trucking &amp; logistics business under a JV with <a href="https://www.smartkarma.com/entities/seino-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:13248:1" rel="noopener">Seino Holdings (9076 JP)</a>, which now has more than 5,484 trucks in its fleet, covering a whole host of FMCG clients outside <a href="https://www.smartkarma.com/entities/indofood-sukses-makmur-tbk-p" target="_blank" data-smartkarma-citation="entities:1053:1" rel="noopener">Indofood Sukses Makmur Tbk P (INDF IJ).</a>
<a href="https://www.smartkarma.com/entities/indomobil-sukses-internasional-tbk-pt" target="_blank" data-smartkarma-citation="entities:11738:1" rel="noopener">Indomobil Sukses Internasional (IMAS IJ)</a> is also pushing ahead with its micro-petrol stations across the country with Exxon Mobil and Federal Oil Lubricants. It has 500 stations already open with a target of 700 micro-stations by year-end. These micro-stations are aimed at servicing motorcycle drivers. 
<div class="content-highlight">
<a href="https://www.smartkarma.com/entities/indomobil-sukses-internasional-tbk-pt" target="_blank" data-smartkarma-citation="entities:11738:1" rel="noopener">Indomobil Sukses Internasional (IMAS IJ)</a> is an interesting restructuring story backed by the Salim Group, which has seen the monetization of its significant investments into the trucking space delayed by COVID-19. Trading on 0.25x FY2020 PBV, with the prospect of a sharp earnings recovery in 2020, driven by both its automotive and trucking exposure. 
</div>

Indomobil Sukses Internasional (IMAS IJ) has come back onto the investment radar as its growth strategy starts to take shape (with an obvious delay from COVID-19), with automotive, including trucks, heavy equipment, and autos, now making up more than 50% of sales. 
The company is the sole distributor for HINO Trucks, the leading large-size truck brand, with more than 50% market share in Indonesia and has now 100% of the Volvo distribution for the country. 
The company has also started to revive its Nissan auto business, increasing its stake in the distributor to 75%, giving Indomobil Sukses Internasional (IMAS IJ) a higher vested interest in the brand's success. It has also expanded the number of Suzuki dealers and is now the sole distributor for KIA in Indonesia. 
Indombil is one of Indonesia's largest multi finance companies, with a greater exposure to commercial vehicles than its peers, which makes it relatively defensive. Indorent is Indonesia's No.3 car leasing player and has been relatively defensive through the pandemic period. 
Indomobil Sukses Internasional (IMAS IJ)  has also significantly grown in its trucking &amp; logistics business under a JV with Seino Holdings (9076 JP), which now has more than 5,484 trucks in its fleet, covering a whole host of FMCG clients outside Indofood Sukses Makmur Tbk P (INDF IJ).
Indomobil Sukses Internasional (IMAS IJ) is also pushing ahead with its micro-petrol stations across the country with Exxon Mobil and Federal Oil Lubricants. It has 500 stations already open with a target of 700 micro-stations by year-end. These micro-stations are aimed at servicing motorcycle drivers. 

Indomobil Sukses Internasional (IMAS IJ) is an interesting restructuring story backed by the Salim Group, which has seen the monetization of its significant investments into the trucking space delayed by COVID-19. Trading on 0.25x FY2020 PBV, with the prospect of a sharp earnings recovery in 2020, driven by both its automotive and trucking exposure. 


Indomobil Sukses Internasional (IMAS IJ) Emerging Transport Monolith?

<div class="content-highlight">
<a href="https://www.smartkarma.com/entities/13338" target="_blank" data-smartkarma-citation="entities:13338:1">AKR Corporindo (AKRA IJ)</a> is quite often pigeon-holed as a chemical and subsidised fuel distributor but a recent visit to their offices in Jakarta revealed that it has a lot more strings to its bow, which will soon start to drive future earnings growth. The company has successfully disposed of a portfolio of non-core assets over the past two years enabling it to reinvest in areas of core strength in Indonesia.
</div>
Volumes for its chemical and petroleum distribution businesses continue to grow at low double digits but sales have been further boosted from higher oil prices. 
Its JV with <a href="https://www.smartkarma.com/entities/21847" target="_blank" data-smartkarma-citation="entities:21847:1">BP PLC (BP/ LN)</a> for a build-out of a network of retail filling stations will see its launch in October, with a plan to open 30 filling stations over the next 12-18 months and 350 over the next 10 years. These stations will include a retail element, as well as motorcycle servicing facility using Castrol lubricants. 
The company's Java Integrated Industrial Estate (JIIPE) near Surabaya will start to make significant contributions to going into 2019, with nine major new customers already identified; mainly in the heavy industry space, including a Freeport smelter.
<a href="https://www.smartkarma.com/entities/13338" target="_blank" data-smartkarma-citation="entities:13338:1">AKR Corporindo (AKRA IJ)</a> is focused on building a strong recurrent income stream from the utilities, which will provide its heavy industry tenants with electricity, deep-water port facilities and water treatment. 
<a href="https://www.smartkarma.com/entities/13338" target="_blank" data-smartkarma-citation="entities:13338:1">AKR Corporindo (AKRA IJ)</a> provides interesting exposure to the Indonesian economy through its chemical and fuel distribution businesses, with its industrial estate and JV with <a href="https://www.smartkarma.com/entities/21847" target="_blank" data-smartkarma-citation="entities:21847:1">BP PLC (BP/ LN)</a> set to provide an additional significant boost to future earnings. The 42% drop in the company's share price YTD provides an interesting potential entry point, with the company now trading on 12.3x FY19E PER and 4.7% FY18E dividend yield.


AKR Corporindo (AKRA IJ) is quite often pigeon-holed as a chemical and subsidised fuel distributor but a recent visit to their offices in Jakarta revealed that it has a lot more strings to its bow, which will soon start to drive future earnings growth. The company has successfully disposed of a portfolio of non-core assets over the past two years enabling it to reinvest in areas of core strength in Indonesia.

Volumes for its chemical and petroleum distribution businesses continue to grow at low double digits but sales have been further boosted from higher oil prices. 
Its JV with BP PLC (BP/ LN) for a build-out of a network of retail filling stations will see its launch in October, with a plan to open 30 filling stations over the next 12-18 months and 350 over the next 10 years. These stations will include a retail element, as well as motorcycle servicing facility using Castrol lubricants. 
The company's Java Integrated Industrial Estate (JIIPE) near Surabaya will start to make significant contributions to going into 2019, with nine major new customers already identified; mainly in the heavy industry space, including a Freeport smelter.
AKR Corporindo (AKRA IJ) is focused on building a strong recurrent income stream from the utilities, which will provide its heavy industry tenants with electricity, deep-water port facilities and water treatment. 
AKR Corporindo (AKRA IJ) provides interesting exposure to the Indonesian economy through its chemical and fuel distribution businesses, with its industrial estate and JV with BP PLC (BP/ LN) set to provide an additional significant boost to future earnings. The 42% drop in the company's share price YTD provides an interesting potential entry point, with the company now trading on 12.3x FY19E PER and 4.7% FY18E dividend yield.

AKR Corporindo (AKRA IJ) - Beyond Petroleum - On the Ground in J-Town

Insight Provider, CrossASEAN Research

Nicolas Van Broekhoven

Insight Provider

Monday I spent the day in Bintan Resorts which is operated by SGX listed <a href="https://www.smartkarma.com/entities/6792" target="_blank" data-smartkarma-citation="entities:6792:1">Gallant Venture Ltd (GALV SP)</a>. I had visited Gallant's operations twice in the last decade but my last visit was over six years ago. Tourism arrival numbers into Bintan have more than doubled since my last visit (+/-900,000 visitors in 2017 vs +/-450,000 visitors in 2013) and I wanted to see the many new attractions that have contributed to the attractiveness of Bintan.
<figure class="editor-figure mceNonEditable"><img class="editor-image img-responsive" src="https://static-prod.smartkarma.com/images/media/000/059/475/original/map%20of%20bintan%20resorts%20august%202018.jpg?1533106100" data-smartkarma-image-id="59475"></figure>
<div class="content-caption">source: Gallant Venture</div>
Bintan is twice the size of…

Monday I spent the day in Bintan Resorts which is operated by SGX listed Gallant Venture Ltd (GALV SP). I had visited Gallant's operations twice in the last decade but my last visit was over six years ago. Tourism arrival numbers into Bintan have more than doubled since my last visit (+/-900,000 visitors in 2017 vs +/-450,000 visitors in 2013) and I wanted to see the many new attractions that have contributed to the attractiveness of Bintan.

source: Gallant Venture
Bintan is twice the size of…

Gallant Venture (GALV SP): Getting Ready to Grow from 1M --> 2M Tourists Per Year in Bintan by 2021

Indonesia

Indomobil is an Indonesian multinational automotive conglomerate engaged in the distribution, assembly, manufacturing, and financing of a wide array of vehicles, including passenger cars, commercial vehicles, two-wheelers, and heavy equipment. The company also provides after-sales services, parts distribution, and related supporting services. Indomobil is headquartered in Jakarta, Indonesia, and was founded in 1976.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Indomobil (IMAS IJ)

Adi Sarana Armada (ASSA IJ) - Auto Leasing, Logistics, and the Last Mile

ASSA is Indonesia's leading B2B car leasing company moving aggressively into related businesses of auto auctions, logistics, and the last mile...

Angus Mackintosh

Astra International (ASII IJ) - An Auto-Recovery Story with a Golden Digital Twist

Astra remains one of our top picks for post-COVID-19 recovery in Indonesia, with its core auto and other businesses gaining ground. It has a rock...

Angus Mackintosh

Indomobil Sukses Internasional (IMAS IJ) Emerging Transport Monolith?

Indomobil Sukses Internasional (IMAS IJ) is an emerging transport monolith with the potential to be an interesting alternative to Astra International.

Angus Mackintosh

AKR Corporindo (AKRA IJ) - Beyond Petroleum - On the Ground in J-Town

AKR Corporindo (AKRA IJ) is quite often pigeon-holed as a chemical and subsidised fuel distributor but a recent visit to their offices in Jakarta...

Angus Mackintosh

Gallant Venture (GALV SP): Getting Ready to Grow from 1M --> 2M Tourists Per Year in Bintan by 2021

Monday I spent the day in Bintan Resorts which is operated by SGX listed Gallant Venture Ltd (GALV SP). I had visited Gallant's operations twice in...

Nicolas Van Broekhoven

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)