Portfolio Watch Indonesia: Stocks Mayora Indah Up after Stock Split
After Indonesian food manufacturer Mayora Indah conducted its 25-for-1 stock split on 4 August 2016 its share price was adjusted to IDR 1,640 a piece. Since that day the company's shares have surged more than 27 percent. Mayora Indah decided to conduct a stock split as its share price had touched IDR 39,000 a piece, are therefore was perceived very expensive by retail investors.
If we go a bit further back in time, and we need to adjust Mayora Indah's share price before the stock split, then we detect a 62 percent rise of the company's shares over the past 12 months, a very good performance indeed of the company that produces biscuits, candies, wafers, chocolate, coffees and healthy foods. Mayora Indah owns some well-known brands in Indonesia including Kopiko, Danisa, Astor, Energen and Torabika. But it also exports its products to various nations around the globe, including China, USA, Japan and Germany.
Its price-to-earnings ratio (PER) is currently at 40.85 times. Mayora Indah recorded good corporate earnings in full-year 2016 with net profit rising 10.7 percent (y/y) to IDR 1.35 trillion (USD $101.5 million) and sales rising 23.6 percent (y/y) to IDR 18.3 trillion (approx. USD $1.36 billion). As a result of the good growth figures and the improving macroeconomic context in Indonesia, the forecasts for Mayora Indah's net profit and sales have been revised up for 2017 and 2018.
Over the past two years the company managed to strengthen its position in Indonesia's modern retail sector. But besides the domestic market, Mayora Indah also managed to boost its exports to several new markets in cities in China and East Europe.
However, production costs have increased for Mayora Indah due to the higher price of crude palm oil and crude oil.
Shares of Mayora Indah are expected to rise to IDR 2,300 a piece (PER 27.5 times) in the period ahead from IDR 2,090 currently and therefore it is an interesting investment choice for investors.
Stock Quote Mayora Indah - MYOR:
Financial Performance Mayora Indah:
| 2012 | 2013 | 2014 | 2015 | 2016 | 2017F |
2018F | |
| Net Revenue | 10,511 | 12,018 | 14,169 | 14,819 | 18,300 | 21,440 | 24,390 |
| Net Profit | 730 | 997 | 404 | 1,220 | 1,350 | 1,590 | 1,910 |
| EBITDA | 1,428 | 1,663 | 1,302 | 2,331 | |||
| P/E Ratio (x) | 33.9 | 29.9 | 83.9 | 31.3 | |||
| P/BV (x) | 6.12 | 8.75 | 6.87 |
in billion IDR rupiah, unless stated otherwise
Source: Maybank Kim Engh Securities (03/04/2017)