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INDY: Impact of Kideco Consolidation Shown in 1H18 Result
12 Sep 2018

INDY: Impact of Kideco’s Consolidation Shown in 1H18 Result

Currently, the share price has corrected by 38% from its higher price this year and traded at 0.88x 2019F PBV (close to its 5-years average PBV +1stdev of 0.85x)  which translates into attractive valuation compared to the industry of 1.01x2019F PBV post Kideco’s full year consolidation effectthis year. Meanwhile, we obtain INDY’s fair value at Rp 4,700/share (vs previously at Rp 4,910/share) on the back of 1) the changes of Kideco’s valuation methodology from EV/EBITDA multiple to DCF valuation; 2) higher net debt and non-controlling interest ended as of 30 June 2018 and 3) the changes in Rupiah assumption of Rp14,200(vs previously at Rp 13,800) following the recent Rupiah depreciation against US$. Hence, we keep BUY rating on the counter with a 67% potential upside.

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