Daily Brief Indonesia: Multi Bintang Indonesia, PT Nippon Indosari Corpindo Tbk. (ROTI), Semen Indonesia (Gresik) and more

In today’s briefing:

Multi Bintang (MLBI) Q4 2023: Growth Resumes, 7% Div Yield On the Cards, With >70% ROCE
PT Nippon Indosari Corpindo (ROTI IJ) – Headwinds Dissipating
Semen Indonesia (SMGR IJ) – Solidifying Indonesia’s Future Path

Multi Bintang (MLBI) Q4 2023: Growth Resumes, 7% Div Yield On the Cards, With >70% ROCE

Multi Bintang Indonesia (MLBI IJ) reported its FY23 earnings with revenues/profits up 6.7%/15% YoY. Q4 FY23 revenues and profits were up 5.6%/17% YoY.
OPM (%) expanded 180 bps from 40.6% to 42.4%, and NPAT margins 240 bps to 32.1%. We believe that trends will continue to improve in 2024.
At its board meeting, we expect the company to declare a full-year FY23 dividend of 500 Rph/share ( implying a 7% yield). The H123 dividend was 110 Rph/share.

PT Nippon Indosari Corpindo (ROTI IJ) saw a relatively slow finish to the year with a slight decline in sales but the key drag came from a higher return rate.
4Q2023 did not see the usual seasonal spike but 2024 has started well and the return rate has come down, which will boost profitability as new products gain traction.
ROTI has launched several more affordable products to help drive its push into general trade whilst raw material prices remain under control. Valuations are attractive with recovery ahead.

Semen Indonesia (SMGR IJ) released a positive set of results in FY2023 despite a difficult operating environment and intense competition through increasing efficiencies linked to sustainability at the same time.
The company continues to work on improving production efficiency as well as distribution through greater digitalisation and is benefiting from synergies from Semen Baturaja.
Increasing government infrastructure spending will help to drive growth in demand for bulk cement, especially from the new capital, with Semen Indonesia being a prime beneficiary. Valuations look attractive.

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