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WTON: Superior 2Q18 Margin, BUY with TP Rp700
08 Aug 2018

WTON: Superior 2Q18 Margin, BUY with TP Rp700

WTON’s revenue and net profit in 1H18 grew by 30% YoY (+17.5% QoQ) and 17.2% YoY (+78.5% QoQ) became to Rp 2.59 trillion and Rp 161 billion, respectively. On quarterly basis, the company gross and operating margins in 2Q18 increased by 292 bps and 195 bps became to 14.1% (vs 11.1% in 1Q18) and to 10.9% (vs 8.9% in 1Q18) thanks to the strategy’s transformation as one-stop solution of precast concrete business and lower marketing expense (-41.7% QoQ). Currently, the share price has corrected significantly by 44% from its high closing price this year which translate into an attractive valuation at 7.89x PER 2019F (below its average PER – 1stdev of 11.86x), hence, we maintain our BUY rating for the counter.

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