UNVR - 9M23 results, overall inline

KBVS Update
Monday, 30 Oct 2023

UNVR: 9M23 results, overall inline
(Maintain BUY; TP: IDR4,390)

•    UNVR’s 9M23 net profit growth squeezed by 9.2% yoy to IDR4.2 tn on the back of lower top line (3.3% yoy) and increasing opex (10.0% yoy). On quarterly basis, net profit grew strong by 20.9% yoy and 5.6% qoq to IDR1.43 tn, driven by improving sales across segment and softened cost input coupled with manageable opex. In all, 9M23 earnings in line with ours and street estimates at 74.5%/74.6% vs 5yr historical average of 76.7%.

•    UNVR saw an improvement GPM by 268bps to 50.1% in 9M23, benefited from lower commodity prices which impacting to soften cost input. Margin expansion was recorded across the business segment in 3Q23, with HPC GPM +6.59% yoy, while foods & refreshment GPM at 1.54%yoy higher to 45.3%.

•    With its in-line 9M23 and offsetting the previous poor 1H23 result, we believe UNVR’s 12M23 result will arrives within ours and street estimates. We revisit our model and made some adjustment on our cost input and Beta assumption. Our new ‘24F EPS for UNVR is now 3.6% higher and around 44bps below ‘24F PATMI for UNVR.

•    We used blended valuation of DCF, DDM, single stage fair PBV and rolling P/E to fairly valued UNVR stocks. Maintain BUY for UNVR with TP of IDR4,390 implying 28.1x ‘24F P/E, while it is currently trading at 25.5x ‘24F P/E, or below its -1SD of 29.3x P/E.

Regards,
Akhmad Nurcahyadi - KBVS Research