Mitra Adiperkasa_1Q23_Earnings

Mitra Adiperkasa : 1Q23 Results

Mitra Adiperkasa (MAPI) posted total net revenues of IDR7.5tr during the first three months of this year (1Q23), representing a robust 32.5% against the same period last year. The gross margin was 44.3% while operating and net profit margins were recorded at 8.9% and 5.4%, respectively.  1Q23 earnings result should provide the next phase of growth since the COVID-19 aftermath along with the country’s improved welfare (in Chart 1).

Earnings Estimates

A moderate total net revenue growth in the order of 17% (in Chart 2) was produced, visualizing the current stable and expanding domestic economic condition. In addition, improvement in the application of technology in more aspects of the business process is expected to produce a stable gross margin in the order of 44% in the next years (in Chart 3). Also, about a similar argument for our operating and net profit margin estimates (in Chart 4). On the other end, MAPI’s strong balance sheet is a solid tool for both efficiency and growth (in Chart 5- Chart 8).

Valuations

Attaching the latest historical earnings multiple averages before the pandemic COVID-19, of 20 times, we arrive at a 12-M Target Price of IDR2,300/share for the Company. Maintain BUY

Cheers,