ASII - FY23 net profit soaring to IDR33.8 tn

ASII - FY23 net profit soaring to IDR33.8 tn Astra International (ASII) posted a net profit of IDR33.8 tn throughout 2023, or grew by 16.9% yoy. The company’s revenue rose 5.03% yoy to IDR316.5 tn. The overall growth was supported by various Astra Group business divisions, which recorded excellent performance, especially mining and automotive. On a segmentation basis, heavy equipment and mining segment sales recorded IDR128.58 tn, followed by the automotive segment sales of IDR128.25 tn. Then, financial services as well as agribusiness which contributed around IDR29.99 tn and IDR20.74 tn, respectively. (Source : Bisnis Indonesia) Comment : In all, ASII’s FY23 net profit arrives far above our and the market's expectations. We expect automotive and financial stable growth to continue to be the main net income growth this year, with the HEMCE segment continuing to be the second largest bottom line growth contributor. FV adjustments on investments in GoTo and Hermina are likely to normalize and thus will not jeopardize ASII’s net income. We also expect that last year's negative sentiment will continue to soften, positively impacting ASII stocks. Maintain BUY with a SOTP target price of IDR7,350, or equal to around 10.8 ‘24F P/E, while currently trading at 7.3x ‘24F P/E or slightly above its -2SD historical mean.