Search result for: "PTPP"

PTPP warrants a discount to the industry’s average P/E as it is the most leveraged company in the business, which poses downside risks on its ability to take on additional mega-projects. A puzzling 1Q13 result guidance and challenges over its dominance on port projects lead us to deem the stock as having reached its fair.

Sector Outlook We maintain an OVERWEIGHT call for the Constructions sector upon the following reasons: i) valuations are reasonable compared to regional players, ii) the government’s infrastructure projects are expected to accelerate earnings growth, iii) there are lower risks in executing projects, as laws will be enforced, iv) the property market’s outlook is solid for.

Upon a limited audit review of their financial statements for purposes of bond issuance in FY13, PTPP finally released its 9M12 financial statements yesterday. The company posted 9M12 revenue of IDR3.9trn (up 34% y-o-y, 95% q-o-q), arriving at IDR106bn worth of net profits (up 73% y-o-y, 63% q-o-q). Top-line financial statement items are in-line with.

We are re-initiating coverage on the construction sector with an OVERWEIGHT for the following reasons: i) valuations are reasonable compared to regional players, ii) the government’s infrastructure projects are expected to accelerate earnings growth, iii) there are lower risks in executing projects, as laws will be enforced, iv) the property market’s outlook is solid for.

We re-instate coverage on Wijaya Karya (WIKA) with a strong BUY and IDR1,600 TP, reflecting a potential 16% upside from its current price. As we roll over our valuation to FY13, we base this TP on a 14.6x target PER over its FY14 EPS. The company’s long-standing relationship with state oil & gas company Pertamina.

We initiate coverage on PTPP with a BUY and IDR950 TP, representing a 17% upside to the current share price. Our TP is based on a target of 11.3x PER over the company’s FY14 earnings, at par with its historical average rolling PER. We like PTPP for its strong 20.3% CAGR in earnings between FY10-FY12,.

We are re-initiating coverage on the construction sector with an OVERWEIGHT for the following reasons: i) valuations are reasonable compared to regional players, ii) the government’s infrastructure projects are expected to accelerate earnings growth, iii) there are lower risks in executing projects, as laws will be enforced, iv) the property market’s outlook is solid for.