ICBP - 9M23 results, overall inline

KBVS Update
Tuesday, 7 Nov 2023

ICBP: 9M23 results, overall inline
(Maintain BUY; TP: IDR13,140)

•    ICBP’s 9M23 net profit doubled to IDR7.06 tn, driven mainly by soaring finance income (+592% yoy), while topline growth reported at 4.9% yoy and 3.1% qoq on the back of higher volume and ASP. In all, 9M23 results was in line with ours and street expectation with a run-rate of 75.2%/74.7% (5yr hist avg: 76.7%).

•    ICBP saw higher sales and EBIT figure across its business segmentation, except for dairy division (-5.7% yoy, -1.3% yoy) as industry demand slowdown. The company delivered higher margin from top to bottom, with GP margin recorded 358bps higher year on year, on the back of lower input cost. NP margin arrived very strong at 700bps higher to 13.8% vs 6.8% in 9M22.

•    We still going to witness ICBP ‘23F EBIT to grow at 8.4% yoy, with EBIT margin at 21.3% or 133bps higher than ICBP’s upper range ‘23F EBIT guidance of 20%. Using the same assumption, ICBP’s net profit could arrives at IDR9.35 tn, or in line with ours and street expectation for ICBP ‘23F net profit at IDR9.93 tn and IDR9.45 tn, respectively.

•    Maintain BUY, with higher TP of IDR13,140. We revisit our model and rolled-over valuation for ICBP to ‘24F. Our TP implying 15.2x ‘24F P/E, while it is currently trading at 12.1x ‘24F P/E, or slightly below its -2SD of 12.8x ‘24F P/E.

Regards,
Akhmad Nurcahyadi - KBVS Research