DEPOK (eNBe Indonesia) - Shares of Astra International (ASII), the country’s largest automotive company, ended only higher by 0.87% to Rp5,800 on Monday (Feb 27) despite strong performance last year.
Astra booked a net profit of Rp28.94 trillion in 2022, grew 45% year on year (y/y), including the fair value gain on its investment in GoTo Gojek Tokopedia (GOTO) and Hermina Hospital (HEAL).
ASII, once the largest company by market capitalization, is now (Rp234.98 trillion), while GOTO’s market capitalization reached Rp121.38 trillion, dropped from Rp350 trillion by mid of 2022.
At the last quoted price, Astra was valued below equity (Rp243.7 trillion) and traded with PE multiple 8 only.
Looks cheap, but investors might have anticipated potential correction going forward amidst prediction of slower economic growth and softening of commodities, particularly thermal coal and palm oil.
Excluding unrealized gain from GOTO and HEAL, Astra’s net income increased by 51% to Rp30.5 trillion, reflecting improved performances from most of the Group’s business divisions, especially the heavy equipment and mining, automotive and financial services businesses.
Astra’s net revenue grew 29% y/y to Rp301.4 trillion in 2022. It reported a 107% jump of net income in heavy equipment, mining, construction, and energy performances. Astra also reported a 664% in infrastructure and logistics.
Net income from the Group’s heavy equipment, mining, construction, and energy division reached Rp12.68 trillion mainly due to higher contributions from heavy equipment sales, mining contracting and coal mining, all of which benefitted from higher coal prices.
59.5%-owned United Tractors (UNTR) reported a 104% increase in net income to Rp21 trillion. Komatsu heavy equipment sales increased by 86% to 5,750 units and saw higher revenue from its parts and service businesses.
Net income from the Group’s automotive division increased by 33% to Rp9.67 trillion, reflecting higher sales volumes. The wholesale market for cars increased by 18% to 1.0 million units in 2022.
Astra’s car sales were 17% higher at 574,000 units, while its market share was relatively stable at 55%. 31 new models and 10 revamped models were launched during last year.
The wholesale market for motorcycles increased by 3% to 5.2 million units in 2022. Astra Honda Motor’s sales rose 2% to 4.0 million units, with sales growth limited by semiconductor supply issues during the middle of the year, while market share decreased slightly.
Three new and 14 revamped models were launched during the year.
The Group’s 80%-owned components business, Astra Otoparts, reported a net income of Rp1.3 trillion, a 117% increase compared to the previous year, mainly due to higher revenues from the original equipment manufacturer and replacement market segments.
Net income from the Group’s financial services division increased by 22% to Rp6.0 trillion in 2022, due to higher contributions from its consumer finance businesses.
The Group’s consumer finance businesses saw a 21% increase in amounts financed to Rp101.7 trillion.
The net income contribution from the Group’s car-focused finance companies increased by 35% to Rp1.8 trillion on larger loan portfolios.
The net income contribution from the Group’s motorcycle-focused finance company, Federal International Finance (FIF), increased by 29% to Rp3.2 trillion, due to a larger loan portfolio and lower loan loss provisions.
Net income from the Group’s agribusiness division increased by 12% to Rp1.4 trillion, largely due to lower crude palm oil sales volumes, which were impacted by the Indonesian export ban imposed for part of the year.
The net income of 79.7%-owned Astra Agro Lestari (AALI) decreased by 12% to Rp1.7 trillion.
Crude palm oil (CPO) prices rose by 15% to Rp12,948/kg. While CPO and derivative product sales fell by 22% to 1.5 million tons, impacted by Indonesia’s temporary export ban on palm oil in the second quarter.
Volume of palm oil might improve this year, but average prices have fallen substantially from last year.
Coal has also dropped significantly from peak last year, which might affect spending of mining companies in heavy equipments. UNTR, the single largest contributor of Astra’s net profit last year, might see substantial correction in almost all segments this year.
Interesting to see whether the newly acquired nickel asset can offset them. Astra’s infrastructure and logistic segment might continue to grow with more movements of people and goods this year.***
