INVESTOR DIGEST

Equity Research | 07 May 2019

Economic Data HIGHLIGHT

Latest 2019F
 1Q19 GDP: Investment Cools Down, Expect the Engine to Heat Up in 2Q19 
7-DRRR (%), eop 6.00 5.75  Strategy 1Q19: A Weak Quarter; Trimming JCI Target to 6,800 
Inflation (YoY %) 2.83 3.80  Telkom 4Q18 Results: Telkomsel vs Non-Telkomsel Trends (TLKM; Rp3,840; Neutral;
US$ 1 = Rp, period avg 14,318 14,450 TP: Rp3,800) 
 Telkom 1Q19 Results: Telkomsel vs Non-Telkomsel Trends (TLKM; Rp3,840; Neutral;
TP: Rp3,800) 
Stock Market Data
(06 May 2019)  XL Axiata 1Q19 Results: Keeping Up The 4G LTE Momentum (EXCL; Rp2,780; Buy; TP:
Rp3,100) 
JCI Index 6,256.4 -1.00%  XL Axiata: Impact from potential Telenor–Axiata merger plan (EXCL; Rp2,780; Buy;
Trading T/O ( Rp bn ) 5,860.8
TP: Rp3,100) 
Market Cap ( Rp tn ) 7,116.5
 Market Recap May 6th 2019; JCI 6,256.35 points -63.11 pts (-1.0%); Valued $411mn;
Mkt Cap $492bn; USD/IDR 14,318 

Market Data Summary*

ECONOMY
2019F 2020F
1Q19 GDP: Investment Cools Down, Expect the Engine to Heat Up in 2Q19
P/E (x) 17.1 15.8
 Easing economic growth in 1Q19. Indonesia’s 1Q19 real GDP slipped to 5.07%
P/BV (x) 2.5 2.3
YoY from 5.18% in 4Q18, a level slightly below our expectation at 5.12% (vs.
EV/EBITDA (x) 13.5 12.8
consensus: 5.20%). In summary, government expenditure, non-profit institutions
Div. Yield (%) 2.5 2.7
spending, and net exports recorded improvement, while slowdown occurred in
Net Gearing (%) 14.9 -
private consumption and gross fixed capital formation. Of those last two, the
13,868,785.8
ROE (%) 15.3 15.3
GFCF was the main sourced of the slowdown.
EPS growth (%) 9.7 8.4  Private consumption was flat. We set a bull’s eye forecast for private
EBITDA growth (%) 5.8 5.2 consumption at 5.01% from 5.08% in the prior quarter. Looking through its
Earnings Yield (%) 5.8 6.3 component, transportation and communication growth fell the most (4.91%
from 6.14%). Re-iterating our view, although government’s social spending was
* Aggregate of 74 companies in MS research universe,
large in 1Q19, the non-social spending realization was relatively low which is also
representing 64.4%of JCI’s market capitalization
followed by the quiet business activities pre-election.

 GFCF drop amid the end of capex cycle. The slowdown on the investment side
was not surprising as it was partly intentionally fabricated. As policymakers have
been more selective on infrastructure projects which led to capital goods import
decrease, the growth of ‘machine and equipment’ component also slowed to
8.4% YoY from 12.3% in 4Q18. Buildings and structures, the component with the
largest share in the GFCF has maintained its growth at 5.5% from 5.0% in the
prior quarter. Additionally, our thesis saying that the capital expenditure cycle
has ended especially in the mining sector was supported by the fact that
‘vehicles’ and ‘other equipment’ components undermined GFCF the most, with
both experiencing contraction in 1Q19 (-7.4% and -6.8% respectively) from
positive growth in 4Q18 (8.4% and 0.3%).

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 Equity Research | 07 May 2019

 Government spending, net exports, and non-profit institutions improved. As predicted, government spending
improved, as the total of personnel, material, and social assistance in the budget accelerated to 22% YoY in 1Q19 from
15.7% in 4Q18. Net exports also ticked up (93.7% YoY from -100.6% in the prior quarter) most notably because of deeper
imports contraction rather than exports. Lastly, non-profit institution spending accelerated to 16.9% from 10.8% in 1Q18,
as election-related activity might be near its peak during the quarter; however its contribution to the overall 1Q19 GDP
has been relatively small at 0.2ppt, hence the figure could not pull up the GDP figure by much.

 Main industries growth eased, information and communication advanced. Agriculture and manufacturing recorded
slower growth in 1Q19. Especially for agriculture, food crops registered a negative contribution to the overall economic
growth at -0.2ppt (vs. 0.08ppt in 4Q18); our preliminary prediction on this is that it was partly on behalf of the shift of
harvest peak to Apr19 instead of Mar19. We also observed information and communication sector printed significant
growth increase (9.0% from 7.2%) which was supported by election-related activities, in our opinion.

 Our view: economic growth trend should pick up in 2Q19. We view private consumption to gain strength in 2Q19,
given Rupiah liquidity condition should improve and government’s non-social spending should rise; both should be the
consumption engine for middle-income consumers. Additionally, the rise of civil servants’ salary by 5% this year, which
will be disbursed accumulatively in Apr19, should support the purchasing power and raise consumption in the quarter
when Eid occurs. For the overall year, we expect the gradual shift from public investment to private investment should
arise post-election along with the government’s incentives. Although the smooth transition of this shift will also depend
on the global situation and exchange rate stability. Therefore, on the policy side, we do not expect 1Q19 economic
growth result would push Bank Indonesia to cut rate soon as the policy rate is aimed to manage the balance of payment
surplus. We maintain our 5.22% economic growth forecast for FY19.

GDP SUMMARY
1Q19
%, YoY 4Q18
Mandiri Consensus Actual
GDP 5.18 5.12 5.12 5.07
Household consumption 5.08 5.01 - 5.01
Non-profit institutions consumption 10.79 8.50 - 16.93
Government expenditures 4.56 6.50 - 5.21
Gross fixed capital formation 6.01 5.83 - 5.03
Exports of goods and services 4.33 6.00 - -2.08
Imports of goods and services 7.10 7.10 - -7.75
Sources: CEIC, Mandiri Sekuritas estimate, Bloomberg

Leo Rinaldy(+6221 5296 9406) leo.rinaldy@mandirisek.co.id

Aziza Nabila Amani (+6221 5296 9651) aziza.amani@mandirisek.co.id

STRATEGY

1Q19: A Weak Quarter; Trimming JCI Target to 6,800

 About 93% of our universe has reported 1Q19 with the portion of those missing estimates increasing to 43% from 40% in
2018. Overall earnings growth was weak at just 7%, as weak commodity prices continued to weigh down earnings along
with cost of fund transmissions and muted private consumption. We reduce end-2019 JCI target to 6,800 as we lower our
EPS forecasts by 3%, though we remain structurally constructive as we expect CAPEX cycle to recommence.

 Weaker EPS growth trend. Our adjusted universe (inclusive of Bank Mandiri – Not Rated) posted 7% YoY earnings
growth in 1Q19, better compared to 4Q18’s -2% YoY decline (or +4% YoY excluding the one-off D&A charges of Xl Axiata).

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 Equity Research | 07 May 2019

Regardless, 7% growth is considered weak relative to the 3% headline inflation and our full-year EPS growth assumption
of 11%. Ex-Banks, 1Q19 earnings growth would have been weaker at just 3% YoY, affected by continued weakness in
commodity sectors, ongoing transmission of higher cost of funds and muted private consumption. Overall, market
revenue growth slowed to +7% in 1Q19 from +12% in 4Q18. Earnings growth accelerations were selective, within
Healthcare and Consumer Staples (i.e. GGRM, ICBP, INDF).

 Potentially 2-3% annualized EPS miss. At 7% YoY, the 1Q19 net profit of our adjusted universe is considered weak and
achieved only 23% of the street’s full-year estimate. Achieving consensus’ latest estimate requires earnings growth
acceleration to ca.16% YoY (ca.14% YoY if we exclude EXCL’s 4Q18 one-off) in April-December 2019, which we think is
difficult given the weakness in commodity prices and the ongoing transmission of higher costs of fund. Potential EPS
upgrades are seen within Consumer Staples and Healthcare; while downgrades are seen within Building Materials,
Consumer Discretionary, Mining, Plantation, and Transportation.

 New end-2019 JCI target at 6,800 (from 7,000). We foresee a potential 2% miss to our bottom-up EPS growth forecast
of 10% for this year. Despite weak EPS growth, we still see a case of re-rating in JCI’s 12-month forward P/E multiple. We
believe this will be driven by the recommencing of CAPEX cycle post-election, the continuity of the Government’s
commitment in stimulating direct investments, and the improvement in Indonesia’s current account balance. Our stock
preferences are unchanged–we like investment proxies, rate-sensitive ones, selective consumers, and growth exposures
via industry consolidation themes.

MANSEK UNIVERSE’S EBIT AND NET PROFIT GROWTH SUMMARY

Sectors EBIT, YoY Net Profit, YoY
3Q18 4Q18 1Q19 3Q18 4Q18 1Q19
Total 14% -2% 4% 16% -2% 7%
Total ex-bank 14% -2% 4% 17% -14% 3%
Total ex-commodities 5% -6% 9% 14% -1% 10%
Ratio of consensus miss 40% 47% 44% 41% 40% 43%
Source: Bloomberg, Company, Mandiri Sekuritas

SUMMARY OF EBIT AND NET PROFIT GROWTH TREND ACROSS ALL SECTORS
Sectors EBIT, YoY Net Profit, YoY
3Q18 4Q18 1Q19 3Q18 4Q18 1Q19
Banking n.a. n.a. n.a. 13% 15% 12%
Building Materials 46% 66% 54% 58% 51% -2%
Infrastructures -16% -14% -19% -22% -9% -28%
Consumer staples 4% 1% 9% 25% 10% 15%
Hospital 4% 10% 35% -6% -26% 19%
Consumer discretionary 37% 38% 16% 39% -3% 5%
Mining 55% 10% -11% 32% -23% -2%
Plantation -20% -70% -106% -65% -22% -145%
Property 27% -21% 15% 9% -30% 35%
Telco -8% -40% 12% -5% -78% 7%
Chemical -3% 3% 5% 7% 45% 15%
Oil and Gas 46% 120% 24% 54% 94% -19%
Transportation 31% 0% -9% 31% 0% -10%
Airline -1% -36% -66% -55%
Total 14% -2% 4% 16% -2% 7%
Total ex-bank 17% -14% 3%
Total ex-commodities 5% -6% 9% 14% -1% 10%
Source: Company, Mandiri Sekuritas estimates

Adrian Joezer (+6221 5296 9415) adrian.joezer@mandirisek.co.id

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 Equity Research | 07 May 2019

CORPORATE

Telkom 4Q18 Results: Telkomsel vs Non-Telkomsel Trends (TLKM; Rp3,840; Neutral; TP: Rp3,800)

 Cellular legacy revenues persisted in 4Q18 and drove 16% earnings decline at Telkomsel in FY18. Meanwhile, the
changing revenux mix led to lower profitability at Non-Telkomsel in FY18. Though, IndiHome’s scale increase should pave
the way for better profitability at Non-Telkomsel beyond FY18. Stay Neutral.

 4Q18 Telkomsel Revenues of Rp23.5tn (-0.7% YoY, +2.4% QoQ). Legacy revenues (Voice & SMS combined) were still
on a declining mode as they fell 26.2% YoY in 4Q18, vs. 21.6% YoY decline in 9M18. As a result, Legacy revenues’
contribution to Telkomsel’s total revenues declined from 54.7% in FY17 to 38.4% in 4Q18. The legacy revenues decline,
however, was offset by the continued momentum in Broadband & Digital Lifestyle revenues, which grew 20.1% YoY in
4Q18, vs. 19.8% YoY in 9M18. Data traffic growth remained strong at 73.6% YoY in 4Q18, albeit slower than the 116.3%
YoY growth in 9M18. Meanwhile, data yield retreated to Rp9.3/MB in 4Q18 after moving up QoQ to Rp9.6/MB in 3Q18. On
full year basis, total revenues decreased 4.3% YoY to Rp89.2tn due to accelerated Legacy Revenues decline, driven by
the intensified competition during prepaid SIM card registration program period and natural usage behavior shift to data-
based voice & messaging services. Broadband & Digital Lifestyle businesses remained as revenue growth engine, growing
19.4% YoY in FY18 and contributing 53.0% of Telkomsel’s FY18 revenues.

 4Q18 Telkomsel EBITDA of Rp12.8tn (+0.6% YoY, +3.6% QoQ). Cost efficiency program helped lower cash opex by
2.3% on YoY basis in 4Q18. We highlight marked decrease in Marketing and Personnel costs in 4Q18, though partly offset
by the higher G&A and O&M costs. Better cash opex trends helped improve EBITDA margin by 63bps/72bps on QoQ/YoY
basis. On full year basis, EBITDA declined 11.5% YoY to Rp47.4tn and EBITDA margin dropped by 434bps YoY to
53.2%, mainly due to the Legacy revenues’ decline during the year.

 4Q18 Telkomsel Net Income of Rp7.24tn (+1.9% YoY, +10.0% QoQ). D&A charges declined 2.5% YoY and Non-
Operating Income grew 20.4% YoY as Other Non-Operating Income jumped 309% YoY to offset the higher interest
expense in 4Q18. On full year basis, Telkomsel’s Net Income declined 16.0% YoY to Rp25.5tn and net margin
dropped 399bps to 28.6%, mainly due to Legacy revenues’ decline during the year.

FINANCIAL SUMMARY
YE Dec (Rp Bn) 2016A 2017A 2018F 2019F 2020F
EBITDA 60,126 64,609 58,984 62,132 66,150
Net Profit 19,352 22,145 18,309 18,948 19,871
Fully-diluted EPS 196 224 185 191 201
Fully-diluted EPS growth (%) 24.4 13.9 (17.3) 3.5 4.9
P/E Ratio (x) 19.6 17.2 20.8 20.1 19.1
EV/EBITDA (x) 6.7 6.3 7.0 6.8 6.5
P/B Ratio (x) 4.5 4.1 3.9 3.7 3.6
Dividend Yield (%) 3.6 4.4 3.6 3.7 3.9
ROAE (%) 24.3 25.0 19.3 19.0 19.0
Source: Company (2017-2018), Mandiri Sekuritas (2019-2021)

TELKOMSEL: 4Q18 AND FY18 RESULTS

in Rp bn 4Q17 3Q18 4Q18 YoY QoQ FY17 FY18 YoY

Voice 9,805 8,198 7,614 -22.3% -7.1% 40,113 32,858 -18.1%

SMS 2,446 1,555 1,422 -41.9% -8.6% 10,841 6,599 -39.1%
Broadband Revenue 10,124 10,939 11,969 18.2% 9.4% 35,524 41,339 16.4%
Digital Service Revenue 1,203 1,527 1,630 35.5% 6.7% 3,942 5,960 51.2%
Others 113 762 889 686.7% 16.7% 2,797 2,490 -11.0%
Total Revenues 23,691 22,981 23,524 -0.7% 2.4% 93,217 89,246 -4.3%

Operation and Maintenance 5,893 6,423 6,282 6.6% -2.2% 23,239 25,059 7.8%
Personnel 1,197 1,085 1,082 -9.6% -0.3% 3,950 4,074 3.1%
Marketing 1,675 891 852 -49.1% -4.4% 4,320 3,347 -22.5%
Interconnection 768 809 826 7.6% 2.1% 2,785 3,191 14.6%

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in Rp bn 4Q17 3Q18 4Q18 YoY QoQ FY17 FY18 YoY

General and Admin. 372 457 614 65.1% 34.4% 1,821 2,072 13.8%
Others 1,046 936 1,047 0.1% 11.9% 3,510 4,063 15.8%
Operating expenses 10,951 10,601 10,703 -2.3% 1.0% 39,625 41,806 5.5%

EBITDA 12,740 12,380 12,821 0.6% 3.6% 53,592 47,440 -11.5%

% margin 53.8% 53.9% 54.5% 72 bps 63 bps 57.5% 53.2% -434 bps

D&A 3,503 3,376 3,415 -2.5% 1.2% 13,558 13,480 -0.6%

Operating profit 9,238 9,004 9,406 1.8% 4.5% 40,034 33,960 -15.2%
% margin 39.0% 39.2% 40.0% 99 bps 81 bps 42.9% 38.1% -489 bps

Non-operating items 172 (132) 207 20.4% -257.4% 379 124 -67.3%

Pre-tax profit 9,410 8,872 9,613 2.2% 8.4% 40,413 34,084 -15.7%

Taxes 2,313 2,293 2,378 2.8% 3.7% 10,018 8,548 -14.7%

% effective tax rate 24.6% 25.8% 24.7% 16 bps -111 bps 24.8% 25.1% 29 bps

Net profit 7,097 6,579 7,235 1.9% 10.0% 30,395 25,536 -16.0%
% margin 30.0% 28.6% 30.8% 80 bps 213 bps 32.6% 28.6% -399 bps

Operating stats 4Q17 3Q18 4Q18 YoY QoQ FY17 FY18 YoY

Total Subscribers (mn) 196,322 167,809 162,987 -17.0% -2.9% 196,322 162,987 -17.0%
Smartphone Subscribers (mn) 108,196 112,633 N.A. N.A. N.A. 108,196 N.A. N.A.
% penetration 55.1% 67.1% N.A. N.A. N.A. 55.1% N.A.

MoU (in bn minutes) 54.6 52.7 50.4 -7.6% -4.4% 211.8 207.0 -2.3%
Voice yield (Rp) 180 156 151 -15.9% -2.9% 189 159 -16.2%

SMS (in bn minutes) 28.5 17.9 16.0 -43.8% -10.6% 135.5 77.4 -42.9%
SMS yield (Rp) 86.0 86.9 88.9 3.4% 2.3% 80 85 6.5%

Data payload (TB) 743,218 1,139,224 1,290,155 73.6% 13.2% 2,168,245 4,373,077 101.7%
Data yield (Rp/MB) 13.6 9.6 9.3 -31.9% -3.4% 16.4 9.5 -42.3%
Source: Company Data, Mandiri Sekuritas Research estimates

NON-TELKOMSEL: 4Q18 AND FY18 RESULTS

in Rp bn 4Q17 3Q18 4Q18 YoY QoQ FY17 FY18 YoY

Fixed 1,239 1,510 1,260 1.7% -16.6% 6,665 5,888 -11.7%

Interconnection (ex-Cellular) 1,347 672 778 -42.2% 15.9% 2,378 2,973 25.0%
Data and Internet (ex-Cellular) 2,254 6,945 3,556 57.8% -48.8% 18,228 23,255 27.6%
Others (ex-Cellular) 2,722 2,728 2,463 -9.5% -9.7% 7,768 9,422 21.3%
Revenues 7,562 11,855 8,057 6.5% -32.0% 35,039 41,538 18.5%

Personnel 1,737 2,179 1,797 3.5% -17.5% 9,579 9,104 -5.0%

Interconnection 74 410 383 417.6% -6.6% 202 1,092 440.6%
Ops and Maint 2,554 4,190 3,030 18.6% -27.7% 9,854 14,669 48.9%
G&A 1,186 752 1,020 -14.0% 35.6% 3,439 4,065 18.2%
Marketing 191 134 379 98.4% 182.8% 948 867 -8.5%
Cash Expenses 5,742 7,665 6,609 15.1% -13.8% 24,022 29,797 24.0%

EBITDA 1,820 4,190 1,448 -20.4% -65.4% 11,017 11,741 6.6%

% margin 24.1% 35.3% 18.0% -609 bps -1737 bps 31.4% 28.3% -318 bps

D&A 2,262 2,166 2,118 -6.4% -2.2% 6,888 7,926 15.1%

EBIT (443) 2,024 (670) 51.3% N.A. 4,129 3,815 -7.6%

% margin -5.9% 17.1% -8.3% -246 bps -2539 bps 11.8% 9.2% -260 bps

Non-operating items (949) (413) (210) -77.9% -49.1% (1,883) (1,494) -20.7%

Pre-tax profit (1,392) 1,611 (880) -36.8% N.A. 2,246 2,321 3.3%

Taxes (983) 310 63 -106.4% -79.7% (60) 878 -1563.3%

% effective tax rate 70.6% 19.2% -7.2% -7779 bps -2640 bps -2.7% 37.8% 4050 bps

Net profit (409) 1,301 (943) 130.7% N.A. 2,306 1,443 -37.4%
% margin -5.4% 11.0% -11.7% -630 bps -2268 bps 6.6% 3.5% -311 bps

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Operating stats 4Q17 3Q18 4Q18 FY17 FY18 YoY

Fixed Broadband Subs ('000) 5,266 6,892 7,260 5,266 7,260 37.9%
Net Add ('000) 520 583 368 937 1,994

IndiHome Subs ('000) 2,965 4,707 5,104 2,965 5,104 72.1%

Net Add ('000) 626 570 397 1,345 2,139

IndiHome ARPU ('000) 285 258 265 324 269 -17.0%

Net Add ('000) (23) 7 7 (18) (55)

IndiHome Revenues (Rp bn; implied) 2,300 3,700 4,000 8,200 13,000 58.5%
Source: Company Data, Mandiri Sekuritas Research estimates

Kresna Hutabarat (+6221 5296 9542) kresna.hutabarat@mandirisek.co.id

Henry Tedja (+6221 5296 9434) henry.tedja@mandirisek.co.id

Telkom 1Q19 Results: Telkomsel vs Non-Telkomsel Trends (TLKM; Rp3,840; Neutral; TP: Rp3,800)

 Telkomsel’s revenue growth returned to positive trajectory as data revenue growth re-accelerated in 1Q19. Meanwhile,
strong IndiHome growth and cash opex seasonality helped Non-Telkomsel businesses achieve record-high revenue and
PAT base in 1Q19. Stay Neutral.

 1Q19 Telkomsel Revenues of Rp22.2tn (+1.4% YoY, -5.7% QoQ). Legacy revenues (Voice & SMS revenues combined)
were still on a decline, down 24.4% YoY in 1Q19 vs. 22.6% in FY18, due to natural usage behavior switch to data-backed
voice & messaging services following the smartphone penetration growth. Meanwhile, Broadband and Digital Lifestyle
revenue growth accelerated to 29.5% YoY in 1Q19 vs. 19.8% YoY in FY18. Data traffic grew 56.6% YoY in 1Q19, slower
than the 101.7% YoY growth in FY18. But, the rate of decline in data yield is more controlled, only down 17.2% YoY in
1Q19 vs. down 42.3% YoY in FY18. To note, Telkomsel’s mobile data yield stood at Rp8.4/MB in 1Q19, vs. Rp9.5/MB in
FY18, and stood ~40% premium to peers’ average data yield.

 1Q19 Telkomsel EBITDA of Rp12.1tn (1.2% YoY, -5.3% QoQ). The company displayed steady cost management
efforts, limiting cash opex growth to 1.5% YoY in 1Q19. The reduction in Marketing and Interconnection costs helped
offset the increase in Operation & Maintenance (O&M) and Personnel costs in 1Q19. The 4.9% YoY O&M cost growth in
1Q19 is commendable, given the 17.8% larger BTS footprint on YoY basis in the quarter. Margin-wise, Telkomsel kept
EBITDA margin flattish on YoY basis at 54.7% in 1Q19, but gained 21bps on QoQ basis.

 1Q19 Telkomsel Net Income of Rp6.47tn (+0.9% YoY, -10.5% QoQ). Telkomsel booked 2.6% YoY decline in D&A
charges in 1Q19, but saw reversal of Non-Operating Items from Rp88bn Non-Operating Income in 1Q18 to Rp8bn Non-
Operating Expense in 1Q19. Meanwhile, effective tax rate was consistent with statutory tax rate of 25% in 1Q19. Net
margin stood at 29.2% in 1Q19, better than the 28.6% net margin in FY18. In overall, Telkomsel booked flattish net
income trend on the back of modest total revenue growth recovery and negative Non-Operating Items in 1Q19.

FINANCIAL SUMMARY
YE Dec (Rp Bn) 2016A 2017A 2018F 2019F 2020F
EBITDA 60,126 64,609 58,984 62,132 66,150
Net Profit 19,352 22,145 18,309 18,948 19,871
Fully-diluted EPS 196 224 185 191 201
Fully-diluted EPS growth (%) 24.4 13.9 (17.3) 3.5 4.9
P/E Ratio (x) 19.6 17.2 20.8 20.1 19.1
EV/EBITDA (x) 6.7 6.3 7.0 6.8 6.5
P/B Ratio (x) 4.5 4.1 3.9 3.7 3.6
Dividend Yield (%) 3.6 4.4 3.6 3.7 3.9
ROAE (%) 24.3 25.0 19.3 19.0 19.0
Source: Company (2017-2018), Mandiri Sekuritas (2019-2021)

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 Equity Research | 07 May 2019

TELKOMSEL: 1Q19 TRENDS

in Rp bn 1Q18 4Q18 1Q19 YoY QoQ
Voice 8,672 7,614 6,824 -21.3% -10.4%
SMS 1,938 1,422 1,196 -38.3% -15.9%
Broadband 9,160 11,969 11,879 29.7% -0.8%
Digital Service 1,346 1,630 1,730 28.5% 6.1%
Others 758 889 551 -27.3% -38.0%
Total Revenues 21,874 23,524 22,180 1.4% -5.7%
Operation and Maintenance 6,053 6,282 6,348 4.9% 1.1%
Personnel 886 1,082 1,051 18.6% -2.9%
Marketing 751 852 583 -22.4% -31.6%
Interconnection 736 826 671 -8.8% -18.8%
General and Admin. 346 614 348 0.6% -43.3%
Others 1,115 1,047 1,043 -6.5% -0.4%
Operating expenses 9,887 10,703 10,044 1.6% -6.2%
EBITDA 11,987 12,821 12,136 1.2% -5.3%
% margin 54.8% 54.5% 54.7% -8 bps 21 bps
D&A 3,588 3,415 3,495 -2.6% 2.3%
Operating profit 8,399 9,406 8,641 2.9% -8.1%
% margin 38.4% 40.0% 39.0% 56 bps -103 bps
Non-operating items 88 207 (8) -109.1% -103.9%
Pre-tax profit 8,487 9,613 8,633 1.7% -10.2%
Taxes 2,071 2,378 2,161 4.3% -9.1%
% effective tax rate 24.4% 24.7% 25.0% 63 bps 29 bps
Profit after tax 6,416 7,235 6,472 0.9% -10.5%
% margin 29.3% 30.8% 29.2% -15 bps -158 bps
Operating stats 1Q18 4Q18 1Q19 YoY QoQ
Total Subscribers (mn) 192,752 162,987 168,642 -12.5% 3.5%
Smartphone Subscribers (mn) 113,286 N.A. N.A. N.A. N.A.
% penetration 58.8% N.A. N.A. N.A. N.A.
MoU (in bn minutes) 51.7 50.4 47.7 -7.8% -5.4%
Voice yield (Rp) 168 151 143 -14.7% -5.3%
SMS (in bn minutes) 23.2 16.0 14.6 -37.0% -8.8%
SMS yield (Rp) 83.6 88.9 81.9 -2.0% -7.8%
Data payload (TB) 899,600 1,290,155 1,408,872 56.6% 9.2%
Data yield (Rp/MB) 10.2 9.3 8.4 -17.2% -9.1%
Source: Company Data, Mandiri Sekuritas Research estimates

NON-TELKOMSEL: 1Q19 TRENDS (IMPLIED)

in Rp bn 1Q18 4Q18 1Q19 YoY QoQ

Fixed 1,546 1,260 1,365 -11.7% 8.3%

Interconnection (ex-Cellular) 415 778 1,063 156.1% 36.6%
Data and Internet (ex-Cellular) 6,041 3,556 7,317 21.1% 105.8%
Others (ex-Cellular) 2,467 2,463 2,915 18.2% 18.4%
Revenues 10,469 8,057 12,660 20.9% 57.1%

Personnel 2,149 1,797 2,081 -3.2% 15.8%

Interconnection 92 383 597 N.A. 55.9%
Ops and Maint 3,076 3,030 3,318 7.9% 9.5%
G&A 904 1,020 946 4.6% -7.3%
Marketing 119 379 324 172.3% -14.5%
Cash Expenses 6,340 6,609 7,266 14.6% 9.9%

EBITDA 4,129 1,448 5,394 30.6% 272.5%

% margin 39.4% 18.0% 42.6% 317 bps 2463 bps

D&A 1,785 2,118 2,147 20.3% 1.4%

EBIT 2,344 (670) 3,247 38.5% N.A.

% margin 22.4% -8.3% 25.6% 326 bps 3396 bps

Non-operating items (299) (210) (551) 84.3% 162.4%

Pre-tax profit 2,045 (880) 2,696 31.8% N.A.

Taxes 483 63 664 37.5% N.A.

% effective tax rate 23.6% -7.2% 24.6% 101 bps N.A.

Please see important disclosure at the back of this report Page 7 of 16

 Equity Research | 07 May 2019

in Rp bn 1Q18 4Q18 1Q19 YoY QoQ

Profit after tax 1,562 (943) 2,032 30.1% N.A.
% margin 14.9% -11.7% 16.1% 113 bps N.A.

Operating stats 1Q18 4Q18 1Q19

Fixed Broadband Subs ('000) 5,740 7,260 7,524

Net Add ('000) 474 368 264

IndiHome Subs ('000) 3,501 5,104 5,522

Net Add ('000) 536 397 418

IndiHome ARPU ('000) 251 265 265

Net Add ('000) (73) 7 (4)

IndiHome Revenues (Rp bn; implied) 2,300 4,000 4,300

Source: Company Data, Mandiri Sekuritas Research estimates

Kresna Hutabarat (+6221 5296 9542) kresna.hutabarat@mandirisek.co.id

Henry Tedja (+6221 5296 9434) henry.tedja@mandirisek.co.id

XL Axiata 1Q19 Results: Keeping Up The 4G LTE Momentum (EXCL; Rp2,780; Buy; TP: Rp3,100)

 XL’s strong cellular data revenue growth helped offset the higher network costs and interest expenses in 1Q19. Data yield
was stable sequentially at Rp6/MB, while data traffic growth remained robust at 70% YoY (helped by 2.4mn additional
smartphone subs in 1Q19). Maintain BUY.

 1Q19 Revenues of Rp5.97tn (+8.5% YoY, -1.3% QoQ) beat our estimates by 1.4% and formed 24.2%/24.2% of
our/consensus’ FY19 revenues estimates. Cellular revenue grew 10.4% YoY/0.6% QoQ, led by cellular data revenue
business that grew 27.1% YoY in 1Q19. XL’s cellular data revenue growth is relatively in-line with Telkom’s, which grew
30.2% YoY in the quarter. XL’s strong cellular data revenue growth was driven by steady data traffic growth (due to higher
smartphone subs base) and stable data yield (flat QoQ at Rp6/MB). Meanwhile, non-data revenue decline in 1Q19 is still
consistent with the trend seen in 4Q18, down ~27% YoY. We also note that XL booked lower Non-Cellular Revenues in
1Q19, mainly due to the decline in Other Non-Cellular Revenues.

 1Q19 EBITDA of Rp2.28tn (+14.7% YoY, -3.1% QoQ) came below our expectation by 1.6%. EBITDA margin however,
improved 209bps on YoY basis, as cash opex only grew 4.9% YoY. Indeed, Infrastructure expenses, the primary cost items,
grew ahead of revenues at 11.2% YoY because of the 22.5% YoY growth in rental expenses (a result of national 4G LTE
network expansion). But, the strong Infrastructure expenses growth was offset by the better efficiency in Sales &
Marketing costs and Interconnection costs in the quarter. To note, XL’s 1Q19 EBITDA formed 23.6%/24.2% of
our/consensus FY19 EBITDA estimates.

 Meanwhile, D&A charges declined 4.2% YoY/70.4% QoQ, returning to a normalized run-rate of ~Rp1.8tn/quarter. We also
highlight that this D&A trend is running below the company’s guidance on 6-7% YoY growth in normalized D&A charges
in FY19. The D&A charges decline then led to the Operating Income beat in 1Q19. XL booked Operating Income of
Rp507bn, up 268% YoY, and achieved 8.5% operating margin in 1Q19. XL’s 1Q19 Operating Income formed
32.3%/26.4% of our/consensus FY19 Operating Income estimates.

 1Q19 Net Income of Rp57bn, vs. 1Q18 Net Income of Rp15bn. XL’s 1Q19 Net Income already surpassed our FY19 Net
Income estimate, but only formed 10.1% of consensus FY19 Net Income estimate. XL’s Non-Operating Expenses about
doubled on YoY basis in 1Q19, mainly due to the higher interest expenses. The higher interest expenses were driven by
the higher debt balance (partly due to higher finance leases contribution) and higher average borrowing rate (due to
conversion of USD debt into IDR debt). XL also incurred Rp27bn tax expense this quarter, implying an effective tax rate of
32%. In overall, XL’s positive Net Income achievement in 1Q19 was driven by the strong cellular data revenue growth and
better D&A trend.

Please see important disclosure at the back of this report Page 8 of 16

 Equity Research | 07 May 2019

 Maintain Buy. XL continued to benefit from its national 4G LTE network expansion and has translated its stronger
network into profitability improvement in 1Q19. Continued 4G LTE momentum and discipline cost management should
help drive 9.2% EBITDA CAGR ‘19-‘22F, in our estimates. More details to follow after the company’s earnings call today
at 12.30PM JKT time.

EXCL: 1Q19 RESULTS

vs % FY19F % FY19F
in Rp bn 1Q18 4Q18 1Q19 1Q19F YoY QoQ
Mansek's Mansek Cons
Cellular 5,164 5,666 5,701 5,510 10.4% 0.6% 3.5%
Data 3,462 4,141 4,400 4,050 27.1% 6.3% 8.6%
Non-data 1,391 1,202 1,017 1,150 -26.9% -15.4% -11.6%
Interconnection 311 323 284 310 -8.5% -11.9% -8.3%
Non-Cellular 340 395 273 385 -19.7% -30.8% -29.0%
Bundling revenues 14 159 54 150 288.3% -65.7% -63.7%
Leased towers 81 73 75 75 -6.9% 3.6% 0.5%
Leased lines 64 56 51 55 -19.6% -9.0% -6.9%
Others 182 107 92 105 -49.2% -13.7% -12.1%
Discount (3) (14) (7) (10) 118.2% -50.5% -30.4%
Revenues (net of discount) 5,501 6,047 5,967 5,885 8.5% -1.3% 1.4% 24.2% 24.2%
IC & service charges 486 629 446 608 -8.2% -29.2% -26.7%
Salaries and employee benefits 263 276 301 270 14.4% 8.7% 11.3%
Sales and marketing 573 453 457 450 -20.3% 0.7% 1.5%
Infrastructure 2,084 2,191 2,316 2,125 11.2% 5.7% 9.0%
G&A and others 110 146 169 115 53.8% 15.5% 46.7%
Operating expenses 3,515 3,696 3,688 3,568 4.9% -0.2% 3.4% 24.6% 24.3%
EBITDA 1,986 2,351 2,279 2,317 14.7% -3.1% -1.6% 23.6% 24.2%
% margin 36.1% 38.9% 38.2% 39.4% 209 bps -69 bps -118 bps
EBITDA less Net Interest Expenses 1,641 1,869 1,756 1,802 7.0% -6.1% -2.5%
D&A 1,848 5,995 1,772 1,930 -4.2% -70.4% -8.2%
Operating profit 138 (3,644) 507 387 268.0% N.A. 31.1% 32.3% 26.4%
% margin 2.5% -60.3% 8.5% 6.6% 600 bps 6877 bps N.A.
Interest income 35 22 21 10 -39.4% -3.8% 113.8%
Interest expenses (381) (504) (544) (525) 43.0% 8.1% 3.7%
FX gain/(loss) (1) 4 (15) - N.A. N.A. N.A.
Extraordinary items 106 106 106 106 0.0% 0.0% -0.3%
Others 32 (106) 9 20 -72.5% N.A. -56.3%
Non-operating items (209) (478) (424) (389) 102.6% -11.5% 8.9%
Pretax profit (71) (4,122) 84 (2) N.A. N.A. N.A.
Taxes (87) (970) 27 (27) N.A. N.A. N.A.
% effective tax rate N.A. N.A. -31.8% N.A. N.A. N.A. N.A.
Net profit 15 (3,152) 57 25 270.6% -101.8% 128.1% 229.0% 10.1%
% margin 0.3% N.A. 1.0% 0.4% 68 bps N.A. 53 bps
Normalized Net profit (63) (255) (11) N.A. -82.9% -95.8% N.A. N.A. N.A.
% margin N.A. N.A. N.A. N.A. N.A. N.A. N.A.
vs
Operating stats 1Q18 4Q18 1Q19 1Q19F YoY QoQ
Mansek's
Total Subscribers (mn) 54.5 54.9 55.0 55.2 1.0% 0.2% -0.3%
Smartphone Subscribers (mn) 40.1 43.9 46.3 44.9 15.5% 5.5% 3.1%
% penetration 73.6% 79.9% 84.1% 81.3% 1054 bps 418 bps 280 bps
Data payload (TB) 427,513 684,727 727,450 739,727 70.2% 6.2% -1.7%
Data yield (Rp/MB) 8.1 6.0 6.0 5.5 -25.3% 0.0% 10.5%
Source: Company Data, Mandiri Sekuritas Research estimates

Kresna Hutabarat (+6221 5296 9542) kresna.hutabarat@mandirisek.co.id

Henry Tedja (+6221 5296 9434) henry.tedja@mandirisek.co.id

XL Axiata: Impact from potential Telenor–Axiata merger plan (EXCL; Rp2,780; Buy; TP: Rp3,100)

 The discussions on Telenor-Axiata merger plan are still on premature stage and offer limited visibility on the potential
change in controlling shareholding at XL Axiata. Though, a successful merger could potentially provide stronger capital
support and procurement synergies to XL Axiata. Maintain BUY.
 What happened? Telenor Group and Axiata Group announced today that both are in discussions regarding a potential
non-cash merger of their telecom and infrastructure assets in Asia, in which Telenor would own 56.5% and Axiata would

Please see important disclosure at the back of this report Page 9 of 16

 Equity Research | 07 May 2019

own 43.5% of the new merged entity (“MergedCo”). The merger plan will involve the consolidation of Telenor’s telecom
assets in 5 countries and Axiata’s telecom assets in 6 countries, excluding Robi in Bangladesh, under the holding of the
new merged entity. The key purposes of this merger plan are to capture substantial synergies (preliminary estimated at
around US$5bn in total), to support future investments, and to create shareholder value.
 Though, both Groups added that there is no certainty that the discussions will result in binding agreement or obligations
on both parties to proceed with any acquisition, merger or divestment. The transaction will be subject to approval by
shareholders, regulators, and other customary terms and conditions as well as complex due diligence processes and
further in-depth discussions.

 Too early to gauge on potential merger impact to XL Axiata. We think the merger discussions between the two
groups are still premature and consolidation efforts would initially focus on their Malaysian businesses i.e. Celcom and
Digi and on structuring the new “MergedCo”. However, we highlight that Axiata Group currently owns 66.36% of XL
Axiata, and assuming the merger plan goes through as planned above, the deal should theoretically trigger a majority
ownership transfer from Axiata Group to the new “MergedCo”, who will be majority owned by Telenor Group. The
implied ultimate shareholding structure at XL Axiata should go as follows: i) 37.5% stake of Telenor Group; ii) 28.9% stake
of Axiata Group; and ii) 33.6% of public minority investors.
 According to the local regulation (POJK No. 9/POJK.04/2018 on Listed Company Takeover), a transfer of majority
ownership does not automatically mean a transfer in controlling shareholding – an event that would trigger mandatory
tender offers. Article 1 of the regulation stated that a controlling shareholder is a party that directly or indirectly: a) owns
more than 50% of the paid-up capital of the listco; or b) has the capacity to determine the management and/or policies of
the listco. The regulation also added that a controlling shareholder must directly or indirectly have at least 20% of the
voting rights at the listco.
 Given there is no clarity yet on management appointment plan nor controlling shareholder policies of the new
“MergedCo” (let alone of XL Axiata post-deal), there is no sufficient reasoning yet to conclude that a successful Telenor-
Axiata merger deal will trigger a mandatory tender offer at XL Axiata.
 Having said that, a successful Telenor-Axiata deal could potentially strengthen capital support and extend global
procurement synergies to XL Axiata, whose broadband market Axiata Group plans to commit additional investments into.
We maintain our BUY rating on XL Axiata given its strengthening market positioning in Indonesian telecom market and
potential ROIC improvement over the medium to longer term.

Kresna Hutabarat (+6221 5296 9542) kresna.hutabarat@mandirisek.co.id

Henry Tedja (+6221 5296 9434) henry.tedja@mandirisek.co.id

MARKET

Market Recap May 6th 2019; JCI 6,256.35 points -63.11 pts (-1.0%); Valued $411mn; Mkt Cap $492bn; USD/IDR 14,318

 TOP TURNOVER: BBRI TLKM BMRI BBNI BBCA SMGR ASII BDMN BTPS BRPT GGRM PTBA ERAA PGAS (40%)

 ADVANCING SECTOR: consumer+0.4%

 DECLINING SECTOR: cement-3%; auto-2.2%; financial-2%; property-1.5%; telco-1.4%; mining-0.9%; plantation-0.8%;

construction-0.3%

 Indo stocks slide, taking the JCI to lowest intraday since Jan 4th as Asian stocks dropped after US President Donald
Trump’s threat to increase tariffs on Chinese imports cast doubts over talks this week that were expected to finalize a
trade deal. The JCI fell for third day, dropping 1.5% in early trade led by financial and cement stocks: BBRI-3.4% BMRI-1.6%
BBNI-4.1% BBCA-1% SMGR-9% INTP flat. 221 of 631 shares fell; while 82 rose. In the past year, the index had a similar or
greater loss 17x. The next day, it advanced 11 times for an avg 1.3% and declined five times for an avg 1%. The index
advanced 7.5% in the past 52 weeks; while MSCI AC Asia Pacific Index lost 6.3% in the same period. The JCI is now 5.7%

Please see important disclosure at the back of this report Page 10 of 16

 Equity Research | 07 May 2019

below its 52-week high on April 18, 2019 and 12.5% above its low on July 4, 2018. The JCI is down 2.7% in the past five
days and fell 3.8% in the past 30 days. The index’s dividend yield is 2.2% on a trailing 12-month basis. 30-day price
volatility rose to 11.86% compared with 11.67% in the prev session and avg of 11.06% over the past month. The IDR
weakened against the USD to 14318, from 14266. The benchmark 10-year bond fell and the yield rose 3.2bps to 7.912%.

 The share price of EXCL rose by 2.5% to 2850 level, the most since Apr 29th, in 1.5x avg five-week vol after 1Q19 net
income jumped nearly fourfold to IDR57.2BN. While the share price of SMGR dropped the most in three years by 9% at
11150 level in 1.2x avg five-week vol as the company may face risk of more earnings downside. Weak volume expected in
2Q19 due to Ramadan festive season may put pressure on selling price. Also, CPO plays tumbled 2% as commodities
dropped after Trump tariff threat: AALI flat BWPT-1.3% LSIP-3.1% SIMP-1.9%. In the end, the JCI fell 1.1% at 6256 level in
thin turnover of $411MN (excluding $17.3MN TLKM; $15MN BJBR; $9.3MN BMRI; $8.2MN ARMY crossing). Foreign
participants at 35% came up better seller for 17%. Losers beat gainers by to 3 to 1.

 Asian equities tumbled, oil prices plunged and the safe-haven yen strengthened early on Monday as trade negotiations
between China and the US deteriorated suddenly, reversing apparent progress made in recent months. US President
Donald Trump sharply escalated trade tensions between the world’s two largest economies with tweeted comments on
Sunday that talks toward a trade deal with China were proceeding “too slowly”, and that he would raise tariffs on $200BN
of goods to 25% on Friday from 10%. He also said he would target a further $325BN of Chinese goods with 25% tariffs
“shortly”. The tweets upended the previously calm market mood that had benefited from signs of robust growth in China
and the US, and from comments from Trump and other senior US officials that trade talks were going well. The WSJ
reported on Monday that China was considering cancelling trade talks scheduled for this week following Trump’s threats.
With an imminent trade deal on hold, Treasury futures jumped 14 ticks. Data from CME Group showed the market sees a
nearly 58% chance of a Fed rate cut by the end of the year. As investors flocked to the safe-haven yen, the dollar dropped
0.4% against the Japanese currency to 110.67. But China’s offshore yuan plunged, weakening to 6.8108 per dollar, its
weakest level since Jan 23rd. The single currency was down 0.18% on the day at $1.1180. The DXY was up at 97.574. In
commodity markets, US crude plunged 2.15% at $60.61 a barrel and Brent crude fell 1.78% to $69.59 per barrel. Spot gold

Sales Team +6221 527 5375

FROM THE PRESS

Bank Mandiri (BMRI) raises special rates

CFO of the bank, Panji Irawan states that due to tightening liquidity, BMRI raises special rates and some of foreign deposit
rates. Director of small business and networks of the bank states that in order to maintain NIM, BMRI will focus on cheap
funding. (Bisnis Indonesia)

Bank Muamalat awaits approval from OJK

On May-19, Bank Muamalat plans to sign an acquisition deed, however, it can be done upon OJK’s approval. One of the
potential investor, Al Falah Investments Pte Limited is said to have deposited Rp2tn to Bank Muamalat to demonstrate
commitment as a standby buyer for Bank Muamalat’s rights issue. Deputy commissioner of strategic management and logistic
OJK, Anto Prabowo states he has not heard any new info regarding Bank Muamalat. He did not give comment when asked
about the continuation of asset swap Bank Muamalat. Previously, the OJK has rejected Bank Muamalat’s asset swap plan as it
is considered not meeting the requirement of financial engineering. (Bisnis Indonesia)

Centratama Telekomunikasi (CENT) set Rp1.35tn of capex

Centratama Telekomunikasi Indonesia (CENT) set Rp1-1.35tn of capex this year. The company will use both internal cash and
loans to fund the capex. The capex will be used to build new towers and DAS (Distributed Antenna System). As a result, the
company has targeted to have Rp850-890bn of revenue in 2019. Of all telco players, Hutchison 3 and XL Axiata contributed
more to CENT’s revenue, as much as Rp60.8bn and Rp60.7bn respectively. To note, the company has 143,000 of DAS and

Please see important disclosure at the back of this report Page 11 of 16

 Equity Research | 07 May 2019

261,000 of tenants, translated to 1.83 of tenancy ratio. The operating results above put the company as the largest
independent DAS provider in Indonesia with 60% of market share in DAS business. (Bisnis)

Lippo Karawaci (LPKR) announces Gateway Partners investment

LPKR has announced private equity firm Gateway Partners as a new investor in its upcoming rights issue. No plans have been
made to revise the USD730mn targeted through the rights issue. Gateway Partners have invested in real estate, healthcare
and water treatment companies in the region, including Vietnam’s No Va Land. (Company)

Ramayana Lestari (RALS) to target single-digit growth this year

Setyadi Surya, Corporate Secretary of RALS, said the conservative target is based on the 1Q19 GDP growth of 5.07%. RALS
prepared some strategies to achieve the target, such as maximizing the sales in Ramadhan month and expanding market
shares by introducing new concept to target millennial segment. The new concept will transform several Ramayana stores
into Ramayana Prime and Mall Ramayana to City Plaza. RALS already opened 4 City Plaza with one more store in the pipeline
for this year. (Kontan)

Semen Indonesia (SMGR) to issue bonds Rp5tn

SMGR is reviewing plans to issue bonds totaling to Rp5tn in June 2019. The funds will be used for expansion purposes.
(Investor Daily)

Please see important disclosure at the back of this report Page 12 of 16

 Equity Research | 07 May 2019

Indices and Fund Flows Currencies and Bonds Major Commodities

YTD Chg YTD YTD

Indices Last Chg (%) Currency Last Chg (%) Last Chg (%)
(%) Chg (%) Chg (%)

JCI 6,256.4 -1.0 +1.0 Rp/US$ 14,285 +0.29 +0.9 Oil spot (US$/bl) 62.25 +0.5 +37.1
Dow Jones 26,438.5 -0.3 +13.3 US$/EUR 1.120 +0.01 +2.4 Nickel spot (US$/mt) 12,137 +0.5 +14.4
Nikkei 22,258.7 -0.2 +11.2 YEN/US$ 110.76 -0.31 -1.0 Gold spot (US$/oz) 1,281 +0.2 -0.1
Hang Seng 29,209.8 -2.9 +13.0 SGD/US$ 1.363 +0.19 -0.0 Tin 3-month (US$/mt) 19,325 +0.3 -0.8
STI 3,290.6 -3.0 +7.2 CPO futures (Ringgit/ton) 1,984 -1.3 -6.5
Ishares indo 25.0 -2.0 +0.7 Coal (US$/ton) 87.0 -0.7 -14.8
Rubber forward (US¢/kg) 176.0 -0.8 +18.5
Foreign YTD
YTD Gov. Bond Chg Soybean oil
Fund Flows Last Chg Last Chg 26.84 -0.9 -2.6
Chg Yield (bps) (US$/100gallons)
(US$mn) (bps)
Equity Flow -58.7 +4,444 5Yr 7.49 +5 -42 Baltic Dry Index 985.0 -5.0 -22.5
Bonds Flow +42.1 +4,469 10Yr 7.95 +7 -7

Please see important disclosure at the back of this report Page 13 of 16

 Equity Research | 07 May 2019

Equity Valuation
Price Price % of Mkt Cap Net Profit PER (x) P/BV (x) EV/EBITDA (x) EPS Growth Div.Yield
Code Rating (Rp) Target PT (Rp Bn) 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020
MANSEK universe 6,256 6,800 11.9 4,581,202 266,794 289,210 17.1 15.8 2.5 2.3 13.5 12.8 9.7% 8.4% 2.5% 2.7%
Financials 1,598,482 105,062 116,743 15.2 13.7 2.3 2.1 0.0 0.0 13.7% 11.1% 2.2% 2.5%
BBCA Neutral 28,100 26,500 (5.7) 692,806 29,483 32,062 23.5 21.6 4.0 3.6 N.A. N.A. 14.0% 8.7% 1.2% 1.3%
BBNI Neutral 8,875 9,000 1.4 165,507 16,642 18,879 9.9 8.8 1.4 1.3 N.A. N.A. 10.8% 13.4% 3.6% 4.5%
BBRI Buy 4,230 5,000 18.2 521,553 36,551 41,656 14.3 12.5 2.6 2.4 N.A. N.A. 13.0% 14.0% 3.1% 3.5%
BBTN Buy 2,380 3,000 26.1 25,204 3,225 4,038 7.8 6.2 1.0 0.9 N.A. N.A. 14.9% 25.2% 2.2% 2.2%
BDMN Neutral 5,500 9,000 63.6 52,715 5,804 4,758 9.1 11.1 1.2 1.1 N.A. N.A. 43.3% -18.0% 2.3% 2.3%
BJBR Neutral 1,900 1,770 (6.8) 19,107 1,444 1,838 13.2 10.4 1.6 1.5 N.A. N.A. -8.8% 27.4% 4.7% 4.2%
BJTM Neutral 670 630 (6.0) 9,995 1,145 1,221 8.7 8.2 1.1 1.1 N.A. N.A. -9.2% 6.7% 6.9% 6.3%
BNGA Neutral 1,035 1,350 30.4 26,011 3,946 4,261 6.6 6.1 0.6 0.6 N.A. N.A. 13.3% 8.0% 2.7% 3.0%
BNLI Neutral 925 465 (49.7) 25,940 1,081 1,409 24.0 18.4 1.1 1.1 N.A. N.A. 69.0% 30.3% 0.0% 0.0%
PNBN Buy 1,260 1,550 23.0 30,350 2,990 3,318 10.2 9.1 0.8 0.7 N.A. N.A. -3.0% 11.0% 0.0% 0.0%
BTPS Buy 2,540 3,150 24.0 19,567 1,307 1,648 15.0 11.9 3.7 2.9 N.A. N.A. 35.4% 26.1% 0.0% 1.3%
BFIN Buy 650 1,000 53.8 9,727 1,445 1,655 6.7 5.9 1.6 1.4 N.A. N.A. 7.3% 14.5% 7.6% 8.2%
Construction & materials 262,779 15,612 18,861 16.8 13.9 1.8 1.7 9.9 9.2 0.2% 20.8% 1.5% 1.7%
INTP Buy 20,300 23,500 15.8 74,729 1,868 2,478 40.0 30.2 3.0 2.8 21.1 16.8 65.5% 32.7% 0.5% 0.9%
SMGR Buy 11,150 16,800 50.7 66,136 2,459 4,767 26.9 13.9 2.1 1.8 10.8 7.8 -6.0% 93.9% 1.2% 1.6%
ADHI Buy 1,570 2,035 29.6 5,591 800 741 7.0 7.5 0.8 0.7 4.6 4.2 19.6% -7.3% 2.4% 2.9%
PTPP Buy 2,150 3,085 43.5 13,330 1,733 2,126 7.7 6.3 0.9 0.8 4.3 3.9 17.5% 22.7% 3.3% 3.9%
WIKA Buy 2,280 2,455 7.7 20,429 1,873 1,999 10.9 10.2 1.3 1.2 6.8 6.7 19.6% 6.7% 1.8% 2.0%
WSKT Buy 1,950 2,280 16.9 26,093 3,504 3,051 7.4 8.6 1.3 1.1 9.5 10.4 -24.8% -12.9% 2.7% 2.3%
WTON Buy 555 700 26.1 4,837 525 608 9.2 8.0 1.4 1.2 5.1 4.4 8.0% 15.7% 3.0% 3.3%
WSBP Buy 410 480 17.1 10,808 1,268 1,409 8.5 7.7 1.3 1.2 5.2 4.5 15.1% 11.1% 5.1% 5.9%
JSMR Buy 5,625 5,600 (0.4) 40,826 1,583 1,683 25.8 24.3 2.3 2.2 13.9 15.3 -15.9% 6.3% 0.9% 0.8%
Consumer staples 1,208,717 46,130 50,049 26.2 24.2 6.6 6.0 16.7 15.4 7.6% 8.5% 2.6% 2.7%
ICBP Buy 9,600 10,550 9.9 111,954 4,512 4,613 24.8 24.3 4.6 4.2 15.8 15.6 5.9% 2.2% 1.9% 2.0%
INDF Buy 6,775 9,950 46.9 59,484 4,005 3,958 14.9 15.0 1.7 1.6 7.4 7.3 4.2% -1.2% 3.2% 3.4%
MYOR Neutral 2,600 2,550 (1.9) 58,133 1,882 2,061 30.9 28.2 6.1 5.3 15.9 14.4 13.9% 9.5% 1.0% 1.1%
UNVR Neutral 45,325 43,100 (4.9) 345,830 7,560 8,123 45.7 42.6 57.4 52.5 31.7 29.4 -17.0% 7.4% 2.6% 2.2%
GGRM Buy 80,600 99,000 22.8 155,081 9,462 10,433 16.4 14.9 3.0 2.6 10.7 9.7 21.4% 10.3% 1.9% 1.9%
HMSP Buy 3,390 4,000 18.0 394,318 15,337 17,177 25.7 23.0 10.6 10.0 18.9 16.9 16.9% 12.0% 3.3% 3.8%
KLBF Neutral 1,475 1,700 15.3 69,141 2,631 2,856 26.3 24.2 4.3 3.9 16.5 15.1 7.5% 8.6% 1.7% 1.9%
SIDO Buy 985 1,050 6.6 14,775 739 827 20.0 17.9 4.5 4.0 14.4 12.8 11.4% 11.9% 3.9% 4.4%
Healthcare 49,327 851 987 58.0 50.0 4.0 3.6 17.6 15.1 7.7% 16.0% 0.2% 0.2%
MIKA Buy 2,150 2,300 7.0 31,284 643 713 48.6 43.9 7.8 6.1 30.0 27.2 4.8% 10.9% 0.0% 0.0%
SILO Buy 4,700 4,300 (8.5) 7,638 39 46 195.8 166.0 1.2 1.2 7.1 6.1 41.1% 18.0% 0.0% 0.0%
HEAL Buy 3,500 4,500 28.6 10,406 169 228 61.6 45.6 5.6 5.1 16.0 12.8 13.6% 35.1% 0.7% 0.8%
Consumer discretionary 412,763 31,826 32,463 13.0 12.7 2.2 2.0 9.4 9.4 12.8% 2.0% 3.3% 3.7%
ACES Buy 1,600 1,700 6.3 27,440 1,113 1,232 24.6 22.3 5.6 4.8 18.8 16.9 14.8% 10.6% 1.4% 1.6%
LPPF Buy 4,090 7,500 83.4 11,934 2,092 2,278 5.7 5.2 3.4 2.8 2.9 2.4 48.9% 8.9% 8.2% 12.3%
MAPI Buy 970 1,100 13.4 16,102 815 815 19.8 19.8 3.1 2.8 8.1 7.9 13.4% 0.0% 0.7% 0.8%
MPPA Sell 193 250 29.5 1,038 -335 -462 -3.1 -2.2 0.6 0.8 16.2 40.9 -20.3% -37.9% -8.0% -9.7%
RALS Buy 1,760 1,700 (3.4) 12,489 558 626 22.4 19.9 3.1 2.9 15.1 13.6 9.2% 12.2% 2.5% 2.7%
ASII Buy 7,425 8,650 16.5 300,590 23,941 24,095 12.6 12.5 2.0 1.8 9.8 10.2 10.5% 0.6% 3.2% 3.6%
SCMA Buy 1,800 2,200 22.2 26,318 1,628 1,773 16.2 14.8 5.8 5.4 11.4 10.6 8.5% 8.9% 4.9% 5.4%
MNCN Buy 900 1,250 38.9 11,540 1,586 1,610 7.3 7.2 1.1 1.0 4.7 4.4 15.3% 1.5% 5.5% 5.6%
MSIN Buy 318 570 79.2 1,654 229 257 7.2 6.4 1.2 1.1 3.8 3.2 27.2% 12.1% 6.9% 7.8%
PZZA Buy 1,210 1,400 15.7 3,656 199 239 18.4 15.3 2.8 2.4 8.7 7.6 24.2% 20.0% 0.0% 0.0%
Commodities 318,348 32,397 32,035 9.7 9.8 1.2 1.1 4.4 4.2 -1.0% -1.3% 4.1% 4.1%
AALI Buy 10,900 14,200 30.3 20,979 1,817 1,968 11.5 10.7 1.0 1.0 4.5 3.7 16.6% 8.3% 3.0% 3.5%
LSIP Buy 1,100 1,450 31.8 7,505 650 665 11.5 11.3 0.9 0.8 4.0 3.7 11.4% 2.3% 3.1% 3.5%
SSMS Neutral 1,080 1,300 20.4 10,287 1,158 1,263 8.9 8.1 1.8 1.6 5.5 4.8 27.0% 9.1% 2.7% 3.4%
BWPT Neutral 158 195 23.4 4,981 -67 -189 -73.8 -26.3 0.9 0.9 7.8 6.9 70.0% -180.3% 0.0% 0.0%
UNTR Buy 26,925 35,000 30.0 100,434 11,287 10,698 8.9 9.4 1.6 1.5 4.4 4.5 1.4% -5.2% 3.4% 3.2%
ADRO* Neutral 1,315 1,540 17.1 42,062 395 370 7.3 7.8 0.8 0.7 3.5 3.3 -5.4% -6.5% 5.5% 4.8%

Please see important disclosure at the back of this report Page 14 of 16

 Equity Research | 07 May 2019

Price Price % of Mkt Cap Net Profit PER (x) P/BV (x) EV/EBITDA (x) EPS Growth Div.Yield
Code Rating (Rp) Target PT (Rp Bn) 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020
HRUM* Neutral 1,300 1,500 15.4 3,338 24 20 9.4 11.4 0.7 0.7 0.3 0.0 -23.1% -17.7% 5.9% 4.8%
INDY* Neutral 1,680 1,700 1.2 8,753 69 63 8.7 9.5 0.6 0.6 2.3 2.0 -13.7% -8.5% 2.9% 2.6%
ITMG* Buy 18,125 33,400 84.3 19,875 225 224 6.1 6.1 1.3 1.3 2.2 2.1 -13.7% -0.6% 14.0% 13.9%
PTBA Neutral 3,790 4,000 5.5 43,670 4,194 3,665 9.5 10.9 2.5 2.3 7.3 7.5 -16.5% -12.6% 4.8% 4.2%
ANTM Buy 760 1,100 44.7 18,263 924 1,006 19.8 18.2 0.9 0.9 9.7 9.1 5.7% 8.9% 1.8% 1.9%
INCO* Buy 2,900 4,000 37.9 28,815 54 111 36.8 17.8 1.0 1.0 7.6 5.4 -11.0% 106.7% 0.8% 1.7%
TINS Buy 1,260 2,200 74.6 9,384 1,262 1,492 7.4 6.3 1.2 1.1 4.3 3.8 137.4% 18.3% 4.7% 5.6%
Property & Industrial Estate 117,980 8,720 9,656 13.5 12.2 1.2 1.1 10.4 9.9 3.8% 10.7% 1.1% 1.0%
ASRI Sell 326 280 (14.1) 6,406 997 1,578 6.4 4.1 0.6 0.5 7.2 5.7 5.8% 58.3% 0.6% 0.6%
BSDE Neutral 1,265 1,450 14.6 24,347 1,972 2,043 12.3 11.9 0.8 0.8 11.0 11.3 10.0% 3.6% 0.0% 0.0%
CTRA Buy 1,020 1,450 42.2 18,932 981 1,039 19.3 18.2 1.3 1.2 12.2 11.9 -14.0% 5.9% 1.0% 0.8%
JRPT Buy 595 980 64.7 8,181 1,005 919 8.1 8.9 1.2 1.0 7.1 7.6 5.7% -8.6% 3.4% 2.4%
PWON Neutral 665 680 2.3 32,026 2,399 2,426 13.4 13.2 2.2 1.9 9.8 9.9 4.8% 1.2% 0.9% 0.9%
SMRA Buy 990 1,200 21.2 14,283 313 486 45.6 29.4 2.0 1.9 13.7 11.8 -1.8% 55.3% 0.5% 0.5%
DMAS Buy 232 250 7.8 11,182 631 650 17.7 17.2 1.5 1.4 16.7 16.2 12.0% 3.0% 2.8% 2.9%
BEST Buy 272 320 17.6 2,624 422 516 6.2 5.1 0.6 0.5 6.6 5.8 3.9% 22.3% 3.3% 3.9%
Telco 489,758 20,644 22,516 23.7 21.8 3.3 3.2 6.7 6.3 19.3% 9.1% 3.4% 3.6%
EXCL Buy 2,850 3,100 8.8 30,461 25 335 1,219.7 91.0 1.7 1.6 5.7 5.2 N/M 1240.2% 0.0% 0.0%
TLKM Neutral 3,840 3,800 (1.0) 380,399 18,948 19,871 20.1 19.1 3.7 3.6 6.8 6.5 3.5% 4.9% 3.7% 3.9%
ISAT Neutral 2,270 2,800 23.3 12,335 -2,810 -2,598 -4.4 -4.7 1.4 2.0 5.1 4.7 -37.5% 7.6% 0.0% 0.0%
LINK Buy 4,300 6,200 44.2 12,709 1,209 1,328 10.5 9.6 2.3 2.1 5.0 4.5 9.7% 9.9% 4.8% 5.2%
TBIG Buy 3,740 5,700 52.4 16,614 908 1,113 18.3 14.9 4.9 4.4 9.8 9.3 1.8% 22.5% 4.5% 4.5%
TOWR Buy 730 950 30.1 37,241 2,364 2,467 15.8 15.1 4.0 3.5 8.5 8.1 0.7% 4.4% 3.2% 3.2%
Chemical 55,960 1,988 1,955 28.1 28.6 2.9 2.6 8.1 8.0 25.1% -1.7% 0.0% 0.0%
AGII Buy 540 700 29.6 1,656 105 136 15.8 12.2 0.5 0.5 6.4 5.9 5.0% 29.5% 0.0% 0.0%
BRPT* Neutral 3,890 2,640 (32.1) 54,304 129 125 28.8 29.8 3.3 3.0 8.3 8.1 25.4% -3.4% 0.0% 0.0%
Airlines 6,268 436 549 14.4 11.4 1.2 1.1 8.0 6.7 -1.1% 26.1% 0.0% 0.0%
GMFI* Neutral 222 275 23.8 6,268 30 38 14.4 11.4 1.2 1.1 8.0 6.7 -2.0% 26.1% 0.0% 0.0%
Oil and Gas 53,089 2,618 2,797 20.3 19.0 1.1 1.1 6.3 6.0 14.7% 6.8% 1.7% 2.0%
PGAS* Buy 2,190 3,150 43.8 53,089 180 192 20.3 19.0 1.1 1.0 6.3 6.0 13.7% 6.8% 1.7% 2.0%
Transportation 7,731 510 599 15.1 12.9 1.4 1.3 6.5 5.8 11.6% 17.3% 1.8% 2.2%
BIRD Buy 3,090 4,400 42.4 7,731 510 599 15.1 12.9 1.4 1.3 6.5 5.8 11.6% 17.3% 1.8% 2.2%
Note:
- *) net profit in USD mn
- U/R means Under Review
- n/a means Not Available
- N/M means Not Meaningful
- N.A means Not Applicable

Please see important disclosure at the back of this report Page 15 of 16

 Mandiri Sekuritas A subsidiary of PT Bank Mandiri (Persero) Tbk
Menara Mandiri Tower I, 25th floor, Jl. Jend. Sudirman Kav. 54 – 55, Jakarta 12190, Indonesia
General: +62 21 526 3445, Fax : +62 21 527 5374 (Equity Sales)

RESEARCH
Adrian Joezer Head of Equity Research, Strategy, Consumer adrian.joezer@mandirisek.co.id +6221 5296 9415
Tjandra Lienandjaja Deputy Head of Equity Research, Banking tjandra.lienandjaja@mandirisek.co.id +6221 5296 9617
Ariyanto Kurniawan Automotive, Coal, Chemical ariyanto.kurniawan@mandirisek.co.id +6221 5296 9682
Kresna Hutabarat Telecom, Media kresna.hutabarat@mandirisek.co.id +6221 5296 9542
Priscilla Thany Banking, Building Material priscilla.thany@mandirisek.co.id +6221 5296 9569
Lakshmi Rowter Healthcare, Consumer lakshmi.rowter@mandirisek.co.id +6221 5296 9549
Robin Sutanto Property robin.sutanto@mandirisek.co.id +6221 5296 9572
Edbert Surya Construction, Transportation edbert.surya@mandirisek.co.id +6221 5296 9623
Silvony Gathrie Research Assistant Silvony.gathrie@mandirisek.co.id +6221 5296 9544
Riyanto Hartanto Research Assistant riyanto@mandirisek.co.id +6221 5296 9488
Henry Tedja Research Assistant henry.tedja@mandirisek.co.id +6221 5296 9434
Ryan Winipta Research Assistant ryan.winipta@mandirisek.co.id +6221 5296 9510
Leo Putera Rinaldy Chief Economist leo.rinaldy@mandirisek.co.id +6221 5296 9406
Aziza Nabila Amani Economist aziza.amani@mandirisek.co.id +6221 5296 9651

INSTITUTIONAL SALES
Silva Halim Head Institutional Equities silva.halim@mandirisek.co.id +6221 527 5375
Andrew Handaya Institutional Sales andrew.handaya@mandirisek.co.id +6221 527 5375
Feliciana Ramonda Institutional Sales feliciana.ramonda@mandirisek.co.id +6221 527 5375
Henry Pranoto Institutional Sales henry.pranoto@mandirisek.co.id +6221 527 5375
Kevin Giarto Institutional Sales kevin.giarto@mandirisek.co.id +6221 527 5375
Sharon Anastasia Tjahjadi Institutional Sales sharon.tjahjadi@mandirisek.co.id +6221 527 5375
Talitha Medha Anindya Institutional Sales talitha.anindya@mandirisek.co.id +6221 527 5375
Kusnadi Widjaja Equity Dealing kusnadi.widjaja@mandirisek.co.id +6221 527 5375
Edwin Pradana Setiadi Equity Dealing edwin.setiadi@mandirisek.co.id +6221 527 5375
Jane Theodoven Sukardi Equity Dealing jane.sukardi@mandirisek.co.id +6221 527 5375
Michael Taarea Equity Dealing michael.taarea@mandirisek.co.id +6221 527 5375

RETAIL SALES
Andreas M. Gunawidjaja Head Retail Equities andreas@mandirisek.co.id +6221 526 9693
Boy Triyono Jakarta boy.triyono@mandirisek.co.id +6221 526 5678
Dhanan Febrie Handita Bandung dhanan.handita@mandirisek.co.id +6222 426 5088
Yogiswara Perdana Yogyakarta yogiswara.perdana@mandirisek.co.id +62274 560 596
Widodo Solo widodo@mandirisek.co.id +62271 788 9290
Linawati Surabaya Linawati@mandirisek.co.id +6231 535 7218
Ruwie Medan ruwie@mandirisek.co.id +6261 8050 1825
Aidil Idham Palembang aidil.idham@mandirisek.co.id +62711 319 900
Yuri Ariadi Pontianak yuri.ariadi@mandirisek.co.id +62561 582 293

INVESTMENT RATINGS: Indicators of expected total return (price appreciation plus dividend yield) within the 12-month period from the date of the last
published report, are: Buy (15% or higher), Neutral (-15% to15%) and Sell (-15% or lower).

DISCLAIMER: This report is issued by PT. Mandiri Sekuritas, a member of the Indonesia Stock Exchanges (IDX) and Mandiri Sekuritas is registered and
supervised by the Financial Services Authority (OJK). Although the contents of this document may represent the opinion of PT. Mandiri Sekuritas, deriving its
judgement from materials and sources believed to be reliable, PT. Mandiri Sekuritas or any other company in the Mandiri Group cannot guarantee its
accuracy and completeness. PT. Mandiri Sekuritas or any other company in the Mandiri Group may be involved in transactions contrary to any opinion herein
to make markets, or have positions in the securities recommended herein. PT. Mandiri Sekuritas or any other company in the Mandiri Group may seek or will
seek investment banking or other business relationships with the companies in this report. For further information please contact our number
62-21-5263445 or fax 62-21-5275374.

ANALYSTS CERTIFICATION: Each contributor to this report hereby certifies that all the views expressed accurately reflect his or her views about the
companies, securities and all pertinent variables. It is also certified that the views and recommendations contained in this report are not and will not be
influenced by any part or all of his or her compensation.