External broker reports(aggregated public sources), Mirae Asset Securities

Mirae Asset Securities

External broker reports(aggregated public sources)

Equity Bottom-Up

Ramayana Lestari Sentosa / Equity Bottom-Up

<p>No more shopping spree</p><div class="content-highlight"><em>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.</em></div>

No more shopping spreeContent 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.

Ramayana Lestari Sentosa (RALS IJ) - No more shopping spree

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

<p>A recent call with <a href="https://www.smartkarma.com/entities/mitra-adiperkasa-tbk-pt" target="_blank" data-smartkarma-citation="entities:18684:1" rel="noopener">Mitra Adiperkasa (MAPI IJ)</a> management revealed continuing momentum behind the recovery that began in 4Q2020 with growth is back on track and its digital strategy continuing to develop and bear fruit.</p>
<p>The company continues to roll out new stores this year with plans to open a total of 180 new stores. During 1Q2021, the company opened 39 stores and closed 52 underperforming stores. </p>
<p>Store openings are focused on sportswear under <a href="https://www.smartkarma.com/entities/map-aktif-adiperkasa-pt" target="_blank" data-smartkarma-citation="entities:27291:1" rel="noopener">MAP Aktif Adiperkasa PT (MAPA IJ)</a> and fashion, where <a href="https://www.smartkarma.com/entities/mitra-adiperkasa-tbk-pt" target="_blank" data-smartkarma-citation="entities:18684:1" rel="noopener">Mitra Adiperkasa (MAPI IJ)</a> plans to open 65 and 45 new stores respectively but it is also pushing its Apple reseller DigiMap and in addition plans to open a total of 10 Boots stores this year</p>
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<p><a href="https://www.smartkarma.com/entities/mitra-adiperkasa-tbk-pt" target="_blank" data-smartkarma-citation="entities:18684:1" rel="noopener">Mitra Adiperkasa (MAPI IJ)</a> will also open six new Food Hall supermarket outlets this year, which currently has 33 branches.</p>
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<p><a href="https://www.smartkarma.com/entities/mitra-adiperkasa-tbk-pt" target="_blank" data-smartkarma-citation="entities:18684:1" rel="noopener">Mitra Adiperkasa (MAPI IJ)'s</a> digital strategy remains very much intact and continues to grow through the company's MAP Club membership scheme which now has 3.8m active members. It has also moved to collaborate with a fintech on a pay-later installment scheme. </p>
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<p><a href="https://www.smartkarma.com/entities/mitra-adiperkasa-tbk-pt" target="_blank" data-smartkarma-citation="entities:18684:1" rel="noopener">Mitra Adiperkasa (MAPI IJ)</a> trades at a significant discount to its historical valuations and with strong forecast future growth, making it look attractive at these levels, especially in light of the impending recovery and its successful digital strategy. It remains a core proxy for the recovery in consumer spending in Indonesia, which is underway.</p>
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A recent call with Mitra Adiperkasa (MAPI IJ) management revealed continuing momentum behind the recovery that began in 4Q2020 with growth is back on track and its digital strategy continuing to develop and bear fruit.
The company continues to roll out new stores this year with plans to open a total of 180 new stores. During 1Q2021, the company opened 39 stores and closed 52 underperforming stores. 
Store openings are focused on sportswear under MAP Aktif Adiperkasa PT (MAPA IJ) and fashion, where Mitra Adiperkasa (MAPI IJ) plans to open 65 and 45 new stores respectively but it is also pushing its Apple reseller DigiMap and in addition plans to open a total of 10 Boots stores this year

Mitra Adiperkasa (MAPI IJ) will also open six new Food Hall supermarket outlets this year, which currently has 33 branches.



Mitra Adiperkasa (MAPI IJ)'s digital strategy remains very much intact and continues to grow through the company's MAP Club membership scheme which now has 3.8m active members. It has also moved to collaborate with a fintech on a pay-later installment scheme. 

Mitra Adiperkasa (MAPI IJ) trades at a significant discount to its historical valuations and with strong forecast future growth, making it look attractive at these levels, especially in light of the impending recovery and its successful digital strategy. It remains a core proxy for the recovery in consumer spending in Indonesia, which is underway.


Mitra Adiperkasa (MAPI IJ) - Mercury Rising

<p><a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> booked a -23.6% Yoy decline in sales in 1Q2021, as SSSG declined by -36.4% YoY in 1Q2021 but an even greater -37.4% versus 1Q2019, which management is increasingly using as a benchmark. </p>
<p>The company saw its gross profit declined by -24.2% YoY in 1Q2021 and -41.0% versus 1Q2019 but there was some respite from the higher average basket size. </p>
<p><a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a>  suffered a net loss of (IDR95.4bn) during the 1Q2021 versus a profit of IDR143bn in 1Q2019. </p>
<p>In terms of geography,  Greater Jakarta saw the continuing impact from PSBB restriction and Sumatra was the best performing area. Segment-wise, children's clothing was the least impacted, whilst women's clothing and cosmetics saw the worst impact during 1Q2021.</p>
<p>The company operated a total of 147 stores in 1Q2021, with 23 of those on its watchlist for potential closure and 13 of those due to close after Lebaran.</p>
<p><a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> is well prepared for the Lebaran festive period, which will likely be shorter than normal.  It has got its merchandise in early ahead of Lebaran given that mobility restrictions have been tightened over the holiday period.</p>
<p>The company continues to build on its Matahari Rewards program with 6.6m active members as of the end of March 2021.</p>
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<p><a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> continues to see increasing sales through digital channels but it is still working on its platform upgrade so the contribution remains relatively small.</p>
<p>The outlook is relatively uncertain for <a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> with a shorter and more restrictive Lebaran period ahead, which is normally the peak season for the company's customer base to shop</p>
<p><a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> looks cheap versus its peers but there remain risks to earnings over the Lebaran, which management openly admits are difficult to predict. Longer-term the recovery is likely to be protracted given further store closures and a lack of major sales through digital channels.</p>
<p>Valuations look relatively attractive versus history with the company trading on 13.1x FY21E PER and 7.2x FY22E PER versus its 5-year average forward PER of 12x but we would buy on weakness given some potentially choppy waters ahead.</p>
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Matahari Department Store (LPPF IJ) booked a -23.6% Yoy decline in sales in 1Q2021, as SSSG declined by -36.4% YoY in 1Q2021 but an even greater -37.4% versus 1Q2019, which management is increasingly using as a benchmark. 
The company saw its gross profit declined by -24.2% YoY in 1Q2021 and -41.0% versus 1Q2019 but there was some respite from the higher average basket size. 
Matahari Department Store (LPPF IJ)  suffered a net loss of (IDR95.4bn) during the 1Q2021 versus a profit of IDR143bn in 1Q2019. 
In terms of geography,  Greater Jakarta saw the continuing impact from PSBB restriction and Sumatra was the best performing area. Segment-wise, children's clothing was the least impacted, whilst women's clothing and cosmetics saw the worst impact during 1Q2021.
The company operated a total of 147 stores in 1Q2021, with 23 of those on its watchlist for potential closure and 13 of those due to close after Lebaran.
Matahari Department Store (LPPF IJ) is well prepared for the Lebaran festive period, which will likely be shorter than normal.  It has got its merchandise in early ahead of Lebaran given that mobility restrictions have been tightened over the holiday period.
The company continues to build on its Matahari Rewards program with 6.6m active members as of the end of March 2021.

Matahari Department Store (LPPF IJ) continues to see increasing sales through digital channels but it is still working on its platform upgrade so the contribution remains relatively small.
The outlook is relatively uncertain for Matahari Department Store (LPPF IJ) with a shorter and more restrictive Lebaran period ahead, which is normally the peak season for the company's customer base to shop
Matahari Department Store (LPPF IJ) looks cheap versus its peers but there remain risks to earnings over the Lebaran, which management openly admits are difficult to predict. Longer-term the recovery is likely to be protracted given further store closures and a lack of major sales through digital channels.
Valuations look relatively attractive versus history with the company trading on 13.1x FY21E PER and 7.2x FY22E PER versus its 5-year average forward PER of 12x but we would buy on weakness given some potentially choppy waters ahead.





Matahari Department Store (LPPF IJ) - Uncertain Waters Ahead of Lebaran

Private Capital Markets

<p><a href="https://www.smartkarma.com/entities/tokopedia-pt" target="_blank" data-smartkarma-citation="entities:24239:1" rel="noopener">Tokopedia PT (1087142D IJ)</a> has confirmed that it has hired Morgan Stanley and Citigroup as advisers to help accelerate its plan to go public. The company has not yet decided which route to take to come to market, whether through a straightforward IPO or a SPAC listing, potentially through Richard Li and Peter Thiel's Bridgetown Holdings Ltd.</p>
<p>The company had previously stated that it would definitely seek a listing in its home market of Indonesia, with a potential dual listing in the US, although these statements were made pre-pandemic. </p>
<p>Valuations for <a href="https://www.smartkarma.com/entities/tokopedia-pt" target="_blank" data-smartkarma-citation="entities:24239:1" rel="noopener">Tokopedia PT (1087142D IJ)</a> range from US$8-10bn, although after the last round of funding it was valued at US$7.5bn, making it Indonesia's second most valuation start-up after <a href="https://www.smartkarma.com/entities/gojek" target="_blank" data-smartkarma-citation="entities:25976:1" rel="noopener">Gojek (1379371D IJ)</a>, which was last valued at US$10bn.</p>
<p>An IPO would help the company realize a higher valuation, providing a currency to drive future growth, given it would be an alternative to <a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US), </a>as the number 2 e-commerce player in Indonesia. <a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US)</a> trades at 13x FY21E EV/Sales currently and just raised more than US$2bn through a placement of new ADS's. We look at <a href="https://www.smartkarma.com/entities/tokopedia-pt" target="_blank" data-smartkarma-citation="entities:24239:1" rel="noopener">Tokopedia PT (1087142D IJ)</a> and its positioning in more detail below the fold. </p>

Tokopedia PT (1087142D IJ) has confirmed that it has hired Morgan Stanley and Citigroup as advisers to help accelerate its plan to go public. The company has not yet decided which route to take to come to market, whether through a straightforward IPO or a SPAC listing, potentially through Richard Li and Peter Thiel's Bridgetown Holdings Ltd.
The company had previously stated that it would definitely seek a listing in its home market of Indonesia, with a potential dual listing in the US, although these statements were made pre-pandemic. 
Valuations for Tokopedia PT (1087142D IJ) range from US$8-10bn, although after the last round of funding it was valued at US$7.5bn, making it Indonesia's second most valuation start-up after Gojek (1379371D IJ), which was last valued at US$10bn.
An IPO would help the company realize a higher valuation, providing a currency to drive future growth, given it would be an alternative to Sea Ltd (SE US), as the number 2 e-commerce player in Indonesia. Sea Ltd (SE US) trades at 13x FY21E EV/Sales currently and just raised more than US$2bn through a placement of new ADS's. We look at Tokopedia PT (1087142D IJ) and its positioning in more detail below the fold. 

Tokopedia PT (1087142D IJ) - From Private to Public by Hook or by Crook

<p>Leading Indonesian retailer <a href="https://www.smartkarma.com/entities/mitra-adiperkasa-tbk-pt" target="_blank" data-smartkarma-citation="entities:18684:1" rel="noopener">Mitra Adiperkasa (MAPI IJ)</a> released its 9M2020 results last week, with sales down by -34% to IDR10.2tn for 9M2020 but the group's e-commerce sales increased by +394% over the period, signaling huge success in the company's omnichannel strategy </p>
<p>3Q2020 net revenue saw a much better performance with a +62.1% QoQ increase in net sales to IDR3.4tn against IDR1.1tn in 2Q2020, in spite of continuing measures imposed by the government in Jakarta to restrict movement and mall traffic in the face of the pandemic (PSBB).</p>
<p>The improvement in sales comes across all business segments with especially strong growth in digital sales from MAPEMALL, Zara, Planet Sports, and DigiMAP. </p>
<section class="figure">The group's 3Q2020 numbers were further impacted due to pre-planned measures to clear aging inventory and also higher supply chain costs due to the pandemic, and some short-term staff cost increases. </section>
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<section class="figure">Digital sales also remained elevated even after store openings, boosted by targeted shopper marketing via MAP Club, as well as exclusive product launches across sports, fashion, and F&amp;B platforms.</section>
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<section class="figure"><a href="https://www.smartkarma.com/entities/mitra-adiperkasa-tbk-pt" target="_blank" data-smartkarma-citation="entities:18684:1" rel="noopener">Mitra Adiperkasa (MAPI IJ)</a> aims to run a 360 degree retail model covering sports, fashion, health, beauty, F&amp;B, and convenience stores, as well as a product mix from value to premium price points, brought together under the company's MAP Club Loyalty App.</section>
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<p>The company expects continuing momentum into the 4Q2020, which will help to confirm the ongoing recovery and we would also expect margins to improve given less need for discounting, with a healthier inventory position.</p>
<p><a href="https://www.smartkarma.com/entities/mitra-adiperkasa-tbk-pt" target="_blank" data-smartkarma-citation="entities:18684:1" rel="noopener">Mitra Adiperkasa (MAPI IJ)</a> trades on 22.6x FY21E PER and 15x FY22E PER and it continues to be one of our top picks for the recovery in Indonesia, with a significant increase in exposure to e-commerce and a gradual broadening of it South East Asian exposure, including Vietnam, Thailand, and the Philippines.</p>
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Leading Indonesian retailer Mitra Adiperkasa (MAPI IJ) released its 9M2020 results last week, with sales down by -34% to IDR10.2tn for 9M2020 but the group's e-commerce sales increased by +394% over the period, signaling huge success in the company's omnichannel strategy 
3Q2020 net revenue saw a much better performance with a +62.1% QoQ increase in net sales to IDR3.4tn against IDR1.1tn in 2Q2020, in spite of continuing measures imposed by the government in Jakarta to restrict movement and mall traffic in the face of the pandemic (PSBB).
The improvement in sales comes across all business segments with especially strong growth in digital sales from MAPEMALL, Zara, Planet Sports, and DigiMAP. 
The group's 3Q2020 numbers were further impacted due to pre-planned measures to clear aging inventory and also higher supply chain costs due to the pandemic, and some short-term staff cost increases. 





Digital sales also remained elevated even after store openings, boosted by targeted shopper marketing via MAP Club, as well as exclusive product launches across sports, fashion, and F&amp;B platforms.






Mitra Adiperkasa (MAPI IJ) aims to run a 360 degree retail model covering sports, fashion, health, beauty, F&amp;B, and convenience stores, as well as a product mix from value to premium price points, brought together under the company's MAP Club Loyalty App.









The company expects continuing momentum into the 4Q2020, which will help to confirm the ongoing recovery and we would also expect margins to improve given less need for discounting, with a healthier inventory position.
Mitra Adiperkasa (MAPI IJ) trades on 22.6x FY21E PER and 15x FY22E PER and it continues to be one of our top picks for the recovery in Indonesia, with a significant increase in exposure to e-commerce and a gradual broadening of it South East Asian exposure, including Vietnam, Thailand, and the Philippines.



Mitra Adiperkasa (MAPI IJ) - Digitally Remastered

Indonesia

PT Ramayana Lestari Sentosa Tbk is an Indonesia-based company that operates a chain of department stores and supermarkets across the country. The company sells a wide range of products including clothing, accessories, bags, shoes, cosmetics, and daily necessities under brands like Ramayana, Robinson, and Cahaya. It was founded in 1978 and is headquartered in Jakarta, Indonesia.

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Ramayana Lestari Sentosa (RALS IJ)