Monday, 15 June 2015
TOLL ROAD/COMPANY UPDATE
Jasa Marga
BUY
Target Price, IDR
8,200
Upside
31.2%
The government has unexpectedly decided to apply special discounts of between
25-35% on all toll road tariffs during this year’s Idul Fitri holidays. At the inauguration
6,250 of JSMR’s newest section, Gempol-Pandaan, President Joko Widodo instructed the
6,800 Ministry of SOE and the Ministry of Public Works to apply the discounts 10 days
before (H-10) to 5 days after (H+5) Idul Fitri. This policy move is aimed at helping
42,500 people who are traveling to their hometowns during the annual Idul Fitri exodus
3,187 in addition to ensuring the more efficient distribution of goods. In our calculation,
3.3 the financial impact from the 15-days discount will be quite small, resulting in only
1.0-1.4% lower revenues for JSMR. Nonetheless, we don’t think this populist move
will be welcomed by the market as it raises further concerns over government
IDR, 8200
intervention, which may, we believe, create more uncertainty in the market.
JSMR IJ/JSMR.JK
Last Price, IDR
No. of shares (mn)
Market Cap, IDR bn
(US$ mn)
3M T/O, US$mn
Last Recommendation
28-Apr-2015
19-Mar-2015
27-Feb-2015
BUY
BUY
BUY
IDR 8,200
IDR 8,200
JSMR relative to JCI Index
JSMR (LHS)
Relative to JCI Index (RHS)
%
20
7,500
15
7,000
10
6,500
5
6,000
0
6 /1 2 /1 5
5 /1 5 /1 5
4 /1 7 /1 5
3 /2 0 /1 5
2 /2 0 /1 5
1 /2 3 /1 5
1 2 /2 6 /1 4
1 1 /2 8 /1 4
1 0 /3 1 /1 4
9 /5 /1 4
1 0 /3 /1 4
8 /8 /1 4
7 /1 1 /1 4
-5
6 /1 3 /1 4
5,500
Market Recommendation
BUY
21
HOLD
SELL
5
0
Danareksa vs Consensus
Target price, IDR
EPS 2015F, IDR
PER 2015F, x
Our
8,200
235
26.6
Cons
7,732
262
23.8
Joko Sogie
(62-21) 2955 5827
[email protected]
Danareksa research reports are also
available at Reuters Multex and First Call
Direct and Bloomberg.
www.danareksa.com
Unexpected toll tariff discounts
% Diff
6.1
-10.3
11.8
The first time toll tariffs have been discounted
Last Friday, during the inauguration of JSMR’s newest section, Gempol-Pandaan, President Joko
Widodo took the opportunity to instruct the Ministry of SOE and the Ministry of Public Works to
apply special discounts of between 25-35% on all toll road tariffs in Indonesia from 10 days before
(H-10) to 5 days (H+5) after Idul Fitri. This is the first time toll tariffs have been discounted in
Indonesia. The reasoning behind this government policy move is that it ostensibly helps people
traveling to their hometowns during the annual Idul Fitri exodus which falls 5 days before to 5
days after Idul Fitri. Nonetheless, we believe the policy move is also intended to curb the high
inflation which is normally seen during this period through the lowering of logistical costs.
Minimal impact on JSMR’s performance
We have tried to gauge the financial impact of the toll tariff discounts on JSMR’s financial
performance by calculating the average daily traffic during the Idul Fitri holiday months in the
past. Then we determined how large the traffic in those 15 days was in comparison to JSMR’s fullyear traffic. On average, the 15-days total traffic volume during the Idul Fitri holiday period only
constituted nearly 4.0% of JSMR’s total full-year traffic. Assuming 25-35% tariff discounts, this will
only translate into 1.0-1.4% lower revenues. All in all, the financial impact of this populist policy
on JSMR’s earnings is minimal. Indeed, higher traffic during the Idul Fitri period should offset the
impact of lower tariffs on earnings – hence we don’t believe that any downward revisions need
to be made at this juncture.
This populist move may rattle the market
In our view, even though this policy move reduces logistical costs and helps people who are
travelling to their hometowns during the Idul Fitri holiday, we also feel that it raises further
concerns over government intervention at the micro level. To recall, the government has
undertaken several interventions earlier in the year, such as lowering cement prices in February
and industrial gas prices in April. In short, this policy move may create more uncertainty in the
market.
2013
2014
2015F
2016F
2017F
Toll Revenues, IDR bn
EBITDA, IDR bn
EBITDA Growth, %
Net Profit, IDR bn
Core Profit, IDR bn
Core EPS, IDR
Core EPS Growth, %
Net Gearing, %
PER, x
Core PER, x
PBV, x
EV/EBITDA, x
Yield, %
5,803
3,058
(4.7)
1,028
1,056
155
(28.6)
81.5
41.4
40.2
4.0
16.7
1.5
6,646
3,583
17.1
1,403
1,540
226
45.7
87.5
30.3
27.6
3.7
14.7
1.3
See important disclosure on the back of this report
7,329
3,953
10.3
1,600
1,710
251
11.1
94.6
26.6
24.9
3.4
13.8
1.0
8,316
4,678
18.3
1,877
2,007
295
17.4
101.2
22.6
21.2
3.1
12.1
1.1
9,181
4,937
5.5
1,982
2,117
311
5.5
104.3
21.4
20.1
2.8
11.8
1.3
15 June 2015
Jasa Marga
Exhibit 1. 25-35% discount on tariffs
Section
Current Tariff
Rp
Jakarta-Cikampek
Soedyatmo
BORR
Inner City
Jagorawi
Jakarta-Tangerang
Cipularang
Padaleunyi
Surabaya-Gempol
Belmera
Semarang
Palikanci
JORR
Semarang-Solo
Nusa Dua-Benoa
Surabaya-Mojokerto
25% Discounted Tariff
Rp
Chg, Rp
4,000
6,000
5,500
8,000
3,000
5,000
34,000
8,000
3,000
6,500
2,000
5,000
8,500
7,000
10,000
1,500
3,000
4,500
4,000
6,000
2,500
4,000
25,500
6,000
2,500
5,000
1,500
4,000
6,500
5,500
7,500
1,000
35% Discounted Tariff
Rp
Chg, Rp
1,000
1,500
1,500
2,000
500
1,000
8,500
2,000
500
1,500
500
1,000
2,000
1,500
2,500
500
2,500
4,000
3,500
5,000
2,000
3,500
22,000
5,000
2,000
4,000
1,500
3,500
5,500
4,500
6,500
1,000
1,500
2,000
2,000
3,000
1,000
1,500
12,000
3,000
1,000
2,500
500
1,500
3,000
2,500
3,500
500
Source: Company
Exhibit 2. Average daily traffic during Idul Fitri months
Year
2007
2008
2009
2010
2011
2012
2013
2014
2015
Idul Fitri Day 1
13/Oct/07
2/Oct/08
21/Sep/09
10/Sep/10
31/Aug/11
19/Aug/12
8/Aug/13
28/Jul/14
17/Jul/15
H-10
3/Oct/07
22/Sep/08
11/Sep/09
31/Aug/10
21/Aug/11
9/Aug/12
29/Jul/13
18/Jul/14
7/Jul/15
H+5
18/Oct/07
7/Oct/08
26/Sep/09
15/Sep/10
5/Sep/11
24/Aug/12
13/Aug/13
2/Aug/14
22/Jul/15
Effecting months
October
September/October
September
August/September
August/September
August
July/August
July/August
July
Daily avg. volume
2,239,133
2,350,292
2,425,748
2,550,413
2,924,415
3,137,617
3,342,382
3,423,064
15 days Volume
33,586,992
35,254,385
36,386,224
38,256,191
43,866,228
47,064,252
50,135,734
51,345,956
Source: Company
Exhibit 3. Idul Fitri holiday traffic only 4.0% of JSMR’s full-year traffic
Total traffic H-10 to H+5 Idul Fitri
FY traffic
% of FY (RHS)
1,400
4.04
4.02
1,200
Millions
4.00
1,000
3.98
800
3.96
3.94
600
3.92
400
3.90
3.88
200
34
35
36
38
44
47
50
51
-
3.86
3.84
2007
2008
2009
2010
2011
2012
2013
2014
Source: Company
2
15 June 2015
Jasa Marga
Exhibit 4. Profit & Loss (IDR bn)
2013
2014
2015F
2016F
2017F
Toll Revenues
Others
Operating Revenues
5,803
508
6,311
6,646
583
7,229
7,329
665
7,994
8,316
744
9,060
9,181
832
10,013
Toll collection
Service
Maintenance
JO
G&A
Operating Expenses
873
482
1,569
308
1,088
4,319
1,083
557
1,365
313
1,161
4,477
1,204
618
1,504
329
1,286
4,941
1,318
673
1,674
344
1,399
5,408
1,545
758
1,946
359
1,630
6,239
Operating Profit
EBITDA
Net Interests
Other Income (Expenses)
Pre-tax Income
Income Tax & Minorities
Net Profit
Core Profit
1,992
3,058
(715)
(12)
1,311
(283)
1,028
1,056
2,752
3,583
(950)
(5)
1,822
(419)
1,403
1,540
3,053
3,953
(852)
2,201
(601)
1,600
1,710
3,652
4,678
(1,059)
2,593
(716)
1,877
2,007
3,774
4,937
(1,061)
2,714
(732)
1,982
2,117
2013
2014
2015F
2016F
2017F
3,514
274
3,788
3,291
351
3,641
2,778
371
3,150
2,876
400
3,276
2,656
426
3,081
Fixed Assets -net
Other Non-current Assets
Total Non-current Assets
23,195
1,076
24,270
26,820
1,396
28,217
29,891
1,705
31,596
33,653
1,914
35,567
37,180
2,073
39,253
Total Assets
28,059
31,858
34,746
38,842
42,335
1,651
100
3,120
4,871
654
192
3,468
4,313
212
3,560
3,772
240
3,683
3,923
265
3,813
4,078
Long-term Debt
Other Non-current Liabilities
Total Non-current Liabilities
10,465
2,165
12,629
12,629
3,491
16,120
14,649
3,780
18,430
16,922
4,118
21,040
18,522
4,518
23,041
Total Liabilities
17,501
20,433
22,201
24,963
27,119
Shareholder’s Equity
Total Liabilities and Equity
10,558
28,059
11,425
31,858
12,544
34,746
13,880
38,842
15,216
42,335
Source: Company, Danareksa Sekuritas
Exhibit 5. Balance Sheet (IDR bn)
Cash & Equivalent
Other Current Assets
Total Current Assets
Short-term Debt
Trade Payables
Other Current Liabilities
Total Current Liabilities
Source: Company, Danareksa Sekuritas
3
15 June 2015
Jasa Marga
Exhibit 6. Cash flow (IDR bn)
Pre-tax
Minorities
Depreciation
Tax
Working Capital
Operating Cash Flow
Capex
Investment
Others
Investing Cash Flow
Debt
Equity
Dividend
Others
Financing Cash Flow
Changes in Cash
2013
2014
2015F
2016F
2017F
1,311
99
1,067
(538)
(400)
1,539
1,822
188
831
(435)
(455)
1,951
2,201
59
900
(583)
(235)
2,341
2,593
62
1,026
(689)
(110)
2,882
2,714
82
1,163
(720)
(70)
3,168
(4,929)
(5)
440
(4,494)
(4,456)
7
435
(4,014)
(3,971)
(9)
203
(3,776)
(4,787)
(9)
240
(4,557)
(4,690)
(9)
283
(4,416)
1,902
383
(641)
523
2,167
1,167
(2)
(535)
1,209
1,840
1,366
(59)
(421)
37
923
2,272
(62)
(480)
42
1,772
1,601
(82)
(563)
72
1,027
(788)
(223)
(512)
98
(220)
2013
2014
2015F
2016F
2017F
31.6
48.5
16.3
16.7
10.1
3.9
38.1
49.6
19.4
21.3
12.8
4.7
38.2
49.4
20.0
21.4
13.4
4.8
40.3
51.6
20.7
22.2
14.2
5.1
37.7
49.3
19.8
21.1
13.6
4.9
114.8
81.5
2.2
116.3
87.5
2.3
116.8
94.6
2.6
121.9
101.2
2.9
121.7
104.3
3.0
6
10
10
10
10
4.0
(23.4)
(4.7)
(35.9)
(28.6)
14.5
38.2
17.1
36.6
45.7
10.3
10.9
10.3
14.0
11.1
13.5
19.6
18.3
17.3
17.4
10.4
3.4
5.5
5.6
5.5
Source: Company, Danareksa Sekuritas
Exhibit 7. Key ratios
Profitability, %
Operating Margin
EBITDA Margin
Net Margin
Core Margin
ROAE
ROAA
Capitalization
Debt to Equity, %
Net Debt to Equity, %
Interest Coverage, x
Turnover, days
Trade Receivables
Inventories
Trade Payables
Growth, %
Toll Revenues
Operating Profit
EBITDA
Net Profit
Core Profit
Source: Company, Danareksa Sekuritas
4
15 June 2015
Jasa Marga
DISCLAIMER
The information contained in this report has been taken from sources which we deem reliable. However, none of P.T. Danareksa Sekuritas and/or its affiliated companies and/or
their respective employees and/or agents makes any representation or warranty (express or implied) or accepts any responsibility or liability as to, or in relation to, the accuracy or
completeness of the information and opinions contained in this report or as to any information contained in this report or any other such information or opinions remaining
unchanged after the issue thereof.
We expressly disclaim any responsibility or liability (express or implied) of P.T. Danareksa Sekuritas, its affiliated companies and their respective employees and agents whatsoever
and howsoever arising (including, without limitation for any claims, proceedings, action , suits, losses, expenses, damages or costs) which may be brought against or suffered by
any person as a results of acting in reliance upon the whole or any part of the contents of this report and neither P.T. Danareksa Sekuritas, its affiliated companies or their respective
employees or agents accepts liability for any errors, omissions or mis-statements, negligent or otherwise, in the report and any liability in respect of the report or any inaccuracy
therein or omission therefrom which might otherwise arise is hereby expresses disclaimed.
The information contained in this report is not be taken as any recommendation made by P.T. Danareksa Sekuritas or any other person to enter into any agreement with regard to
any investment mentioned in this document. This report is prepared for general circulation. It does not have regards to the specific person who may receive this report. In
considering any investments you should make your own independent assessment and seek your own professional financial and legal advice.
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