Equity Strategy │ 16 November 2023

Equity Strategy
Election Spending as an Important Theme; OW on
Consumer Staples
Refreshing the important timelines for the approaching election periods

The election campaign season will run from 28 Nov23, until 10 Feb24, three months before both
the presidential and legislative election day on 14 Feb24. According to polling data (figure 3), the
three impending presidential candidates have yet to secure a minimum of 50% of the vote
required to guarantee a one-round election. Consequently, under this current polling situation, the
occurrence of two rounds of presidential elections is the base-case. If no candidates receive 50%
of the vote in the first round, there will be a second round of election campaigning from 2-22 June
2024, prior to the election day on 26 June 2024. Yet, the polling dynamics are still fluid.

Following the presidential election, a simultaneous regional election (Pilkada Serentak) would be
held on 27 Nov24. However, the government has agreed to move the Pilkada Serentak to Sep24
(from Nov24), which is planned to be revised on government rules in lieu of law (Perppu). If the
Pilkada timetable is pushed forward to September 24, it will take place one month before the
President and Vice President's inauguration on 20 Oct24.

Assuming a single round of elections, our economist estimates that the prospective election
campaign fund could amount to Rp140trn (approximately 0.8% of GDP). We believe that, in the Willinoy Sitorus
case of a one-round or two-round scenario, the size differences of the campaign fund would be willinoy.sitorus@trimegah.com
inconsequential, given that the majority of the funds would circulate in the first round and Pilkada
Serentak. A campaign fund would have a lengthy lifespan (approximately ten months) until Heribertus Ariando
Pilkada Serentak concludes on September 24. Additionally, we observe that fiscal expenditures on Heribertus.ariando@trimegah.com
social assistance in 2023–24 are substantially greater than during the three preceding election
cycles, and additional upward adjustments are possible.

M1 supply showing signs of acceleration

We monitored the growth of the M1 supply during election periods between 2004 and 2020. The
trend indicates that M1 has a tendency to increase prior to the presidential election period. We
believe that this period would have a strong social spending and would have a trickle-effect to the
economy. Based on our analysis of channel checks and a compilation of economic, industry, and
company data, we do not encounter many noteworthy growth figures until September 23 (figure
7). Nevertheless, we observe that M1 supply growth (excluding demand deposits) began to
accelerate on September 23 to +6.95% YoY (prev: +5.78% YoY). Coincidentally, this is the same
month when Govt provided a 10kg of rice/month social assistance for 22mn households.

Weak 9M23 results across the consumer staples already bottomed?

The consumer staples under our coverage (UNVR, SIDO, HMSP, GGRM, ROTI, MYOR, CMRY, ICBP,
and ULTJ) reported a -2% YoY decline in aggregate 9M23 revenue, despite a +11% aggregate
increase in net profit due to higher selling price adjustments offsetting the weak sales volume and
low raw material prices. Some companies will book a strong 4Q due to seasonality factors. Yet we
have not seen much correlation in regards to the multiplier effect from election spending. We
believe this would be more apparent in the next several months ahead.

Consumer staples catalyst: Social spending Vs. minimum wage hike?

PP 51 2023 regarding provincial minimum wage hike was released recently on 10 Nov23. The
regulation displayed a minimum wage formula of UM (t+1) = (Inflasi + (PE X α)) X UM (t), which
according to our analysis, displays a less significant minimum wage hike compared to what labour
unions’ +15% wage hike proposes (based on various media sources). However, this is still subject
to changes as the final decision will be done on 20th Nov23 followed by regional minimum wage on
30th November. If the final UMP decision decides a somewhere in the middle (+8% to +10%),
then this would be attractive for consumer staple stocks. With heightened campaign
activities, increased social aid spending, and upward adjustments in minimum wages,
consumer players are poised to beneficiaries.

PT Trimegah Sekuritas Indonesia Tbk – www.trimegah.com 1

Good earnings momentum in the consumer + retail space

The average 4Q revenue and net profit seasonality over the period of 4Q14 to 4Q22 were 27%
and 30%, respectively. We anticipate this seasonality to persist with 4Q23f revenue and net profit
seasonality at 27% and 28%, respectively. In comparison to all other sectors covered by
Trimegah, the consumer + retail sector exhibited the most substantial 4Q23f QoQ momentum
growth. We estimate the 2024 consumer + retail net profit growth to book +11% YoY, which is
comparable to the growth of the big 4 banks.

Top consumer picks

Our consumer analyst’s top consumer picks are: MYOR, HMSP, GGRM, ICBP, MIDI. Should you
refer to figure 11, 12, 13 and 14, our top choices are determined by dividing the rankings across
our entire consumer and retail space into three categories: 1) Revenue multiplier effect from rise
in consumer wallet, 2) Room for higher margin, 3) Impact of rising wages. We analyze historical
minimum wage growth trends and their financial implications for the companies we cover in our
consumer coverage from 2008 to 9M23. Our sensitivity analysis (refer to figure 23) suggests that
a mere 4% minimum wage would still premise good growth for MYOR, ICBP, HMSP, GGRM and
MIDI. Hence, any higher than expected wage growth is considered as an upside risk.

Figure 1. Upcoming election timeline

Source: KPU

Figure 2. Our economist estimates ~Rp140trn of election campaign fund (0.8% of GDP) assuming only 1 election period

Consumption Investment Money Supply IHSG (monthly)

Q before election (+) Not (-) Not

(+) Significant (-) Significant
Significant Significant

Q during election (+) Significant (-) Significant (+) Significant (-) Significant

Q after election (-) Not (+) Not (-) Not

(+) Significant
Significant Significant Significant

Presidential Presidential Candidates

Candidates
Assuming:
DPR Candidates • 18 parties
(80 constituencies) • Each party Legislative candidates (DPR RI,
February has 5 DPRD I & DPRD II):
DPRD Candidates candidates
(272 constituencies) for each 230,220
constituency
DPRD II Candidates
(2206 constituencies)

Election Campaign Fund

2024
3 President and Total Campaign Fund
Vice Candidates: if there’s 1 Round
IDR600-800bn
575 Regional Legislative KPU /Candidate (official, IDR140tn (0.8% of
Leaders Candidate: Budget: 2019) GDP)
November Candidates IDR2.4tn
(Governors, 230,220 x IDR22tn
Mayors & IDR500mn = (2023 Total Campaign Fund
Regents) IDR115tn only) More Campaign if there’s 2 Round
Expense in 2 Round
IDR5tn IDR145tn (0.82% of
GDP)

Source: Charta Politica, Trimegah research

PT Trimegah Sekuritas Indonesia Tbk – www.trimegah.com 2

Figure 3. None of the 3 presidential candidates reach the 50% level threshold based on surveys.

(%)
60

Minimum treshold to have only 1 round of election

50

40

30

20

10

0
Anies-Muhaimin Ganjar-Mahfud MD Prabowo-Gibran

Presidential Candidate Polling: Various Sources

Presidential Candidate Polling: National Average

Source: Various survey institutes

Figure 4. Over the past 2 decades during election period, usually cash/liquid savings accelerate after presidential election. This time
could accelerate even faster as this is the first time Indonesia holds a simultaneous regional election within the same year with
presidential election.

Source: BI, Bloomberg

Figure 5. Lists of social related spending since 2H23 to 2024f

Source: State Budget 2024

PT Trimegah Sekuritas Indonesia Tbk – www.trimegah.com 3

Figure 6. Fiscal budget on social assistance spending, 2004 to 2024f

Source: CEIC, Trimegah research

Figure 7. No signs of meaningful economic recovery yet

(% YoY) (% YoY)
80.0
30.0
70.0
25.0 60.0
50.0
20.0 40.0
30.0
15.0
20.0
10.0
10.0
0.0

5.0 -10.0
-20.0
0.0 -30.0
Jul-22

Jul-23

Jul-22

Jul-23
Jun-22

Dec-22

Jun-23

Jun-22

Jun-23
Apr-22
May-22

Apr-23
May-23

Apr-22
May-22

Apr-23
May-23
Jan-22
Feb-22
Mar-22

Aug-22

Nov-22

Aug-23
Sep-22

Jan-23
Feb-23
Mar-23

Aug-23
Sep-23

Jan-22
Feb-22
Mar-22

Aug-22

Nov-22
Sep-22

Dec-22
Jan-23
Feb-23
Mar-23

Sep-23
Oct-22

Oct-22

Oct-23
M1 M2 CCI Retail sales index ACES SSSG

(% YoY) (% YoY)
Farmer terms of trade index
7.0 140.0

120.0
6.0
100.0
5.0
80.0
4.0 60.0

3.0 40.0

20.0
2.0
0.0
1.0
-20.0

0.0 -40.0
Jul-22
Aug-22

Jul-23

Jul-22
Aug-22

Jul-23
Nov-22

Aug-23

Aug-23
Feb-22

Apr-22
May-22
Jun-22

Apr-23
May-23
Jun-23

Apr-22
May-22
Jun-22

Nov-22

Mar-23
Apr-23
May-23
Jun-23
Jan-22

Mar-22

Sep-22

Dec-22
Jan-23
Feb-23
Mar-23

Sep-23

Jan-22
Feb-22
Mar-22

Sep-22

Dec-22
Jan-23
Feb-23

Sep-23
Oct-22

Oct-22

Oct-23

Farmer terms of trade index 4W 2W Cement

Data Points Units Latest data M-3 M-2 M-1 M-0 MoM YoY 3MMA
4W wholesale sales Units Sep-23 4,682.7 4,648.1 4,609.5 4,671.0 1.3% 4.1% 4,642.9
4W retail sales Units Sep-23 8,373.0 8,349.5 8,364.7 8,440.0 0.9% 6.0% 8,384.8
4W LCGC Units Sep-23 62.8% 62.8% 62.4% 62.5% 0.1% -0.2% 62.6%
4W non-LCGC Units Sep-23 73.8% 73.8% 73.1% 73.0% 0.0% 0.2% 73.3%
2W sales Units Aug-23 9.5% 7.8% 8.4% 8.9% 0.5% -1.4% 8.4%
UNTR heavy equipment sales Units Sep-23 8.4% 9.9% 11.0% 11.4% 0.4% 1.2% 10.8%
Consumer confidence index Index Aug-23 84.5% 85.1% 85.3% 85.7% 0.4% 2.0% 85.4%
Retail sales index Index Sep-23 81.8% 83.6% 84.0% 84.0% 0.1% 1.7% 83.9%
Farmers terms of trade Index Aug-23 4.9% 4.9% 4.9% 5.0% 0.0% 0.2% 4.9%
AMRT SSSG % Sep-23 5.8% 5.8% 5.8% 5.8% 0.0% 0.5% 5.8%
ACES SSSG % Sep-23 0.4% 1.0% 1.6% 1.4% -0.2% 0.0% 1.3%
Cement wholesale k tons Sep-23 4,682.7 4,648.1 4,609.5 4,671.0 1.3% 4.1% 4,642.9
Cement bag k tons Sep-23 8,373.0 8,349.5 8,364.7 8,440.0 0.9% 6.0% 8,384.8
Cement total k tons Sep-23 62.8% 62.8% 62.4% 62.5% 0.1% -0.2% 62.6%

Source: BI, BPS, Gaikindo, AISI, ACES, Bloomberg, companies, OJK

PT Trimegah Sekuritas Indonesia Tbk – www.trimegah.com 4

Consumer staples catalyst: Social spending Vs. minimum wage hike?
Based on PP 51 2023 regarding provincial minimum wage hike was released recently on 10
Nov23. The regulation displayed a minimum wage formula of UM (t+1) = (Inflasi + (PE X α)) X
UM (t), of which according to our analysis, displays a minimum wage hike of significantly lesser
to what labour unions’ +15% wage hike proposals (based on various media sources). However,
this is still subject to changes as the final decision will be done on 20 th Nov23 followed by
regional minimum wage announcement on 30th November. If the final UMP decision decides a
somewhere in the middle (+8% to +10%), then this would be attractive for consumer staple
stocks.

Figure 8. Formula for minimum wage growth

Current Previous
Regulation PP No. 51/2023 PP No. 36/2021
Imposition November 10th, 2023 February 2nd, 2021

Formula

Variables

Source: MoL, Trimegah research

Figure 9. Household spending breakdown, Mar-23 vs. Mar- Figure 10. Social aid budget realization
22

Source: BPS, Trimegah Research Source: MoF, Trimegah Research

PT Trimegah Sekuritas Indonesia Tbk – www.trimegah.com 5

Our top picks among the pack - MYOR, HMSP, MIDI, ICBP, GGRM
We believe consumer players are well-positioned to capitalize on the improving purchasing power
and the cost advantages driven by economies of scale, with some companies faring better than
others in terms of (a) sales multiplier effect, (b) room for higher marign, abd (c) operating
leverage effect.

Figure 11. Our ranked picks within the consumer universe

Sales Room for Operating

Overall
Ranking multiplier higher leverage
rank
effect margin effect
Weighting 45% 10% 45%
MYOR 1 3 3 1
HMSP 5 - 1 2
MIDI 4 - 6 3
ICBP 6 8 4 4
GGRM 9 - 2 5
MAPI 2 6 9 6
ULTJ 7 2 5 7
ERAA 3 9 8 8
KLBF 10 1 7 9
ACES 8 7 10 10
SIDO 11 4 12 11
UNVR 12 5 11 12

Source: Trimegah Research

We analyze the influence of improving purchasing power on sales by dividing the sales CAGR of a
company over a specific period by the average adjustments in minimum wage. Our observations
reveal that retailers like MIDI, ERAA, and MAPI tend to excel. Their high sales multipliers are
attributed to the elasticity of demand for their products. In contrast, staples generally have low
multipliers due to their inelastic nature. However, exceptions exist, with MYOR, ULTJ, and ICBP
demonstrating a relatively high multiplier.

Figure 12. Sales CAGR vs. minimum wage adjustments

Sales growth
Sales CAGR, Sales CAGR, Sales CAGR, Sales CAGR,
multiplier to min Multiplier*
2008-12 2013-16 2017-20 2021-9M23
wage adjustment

Average minimum
+10.1% +15.0% +8.8% +3.0%
wage adjustment
Staples
MYOR +20.8% +10.6% +9.2% +7.6% 1.6x
ICBP +14.8% +12.5% +4.9% +7.8% 1.1x
KLBF +9.3% +9.2% +4.5% +10.1% 0.8x
UNVR +13.3% +10.1% +1.8% -2.5% 0.4x
SIDO na +1.7% +6.8% +1.5% 0.5x
ULTJ +13.3% +13.6% +6.2% +11.4% 1.1x
Cigarettes
HMSP +17.5% +9.4% -0.8% +8.0% 1.2x
GGRM +11.7% +11.7% +10.7% -1.8% 1.0x
Retailers
MAPI +19.7% +16.9% +1.2% +31.9% 1.5x
ACES +29.5% +11.2% +10.7% +0.8% 1.0x
MIDI na +21.7% +10.5% +11.3% 1.4x
ERAA na +12.4% +13.5% +21.1% 1.5x

Source: Trimegah Research

*Median values are presented, and a higher multiplier is considered favorable. For instance, a 2x multiplier implies that if the
minimum wage increases by 10% YoY, the company's sales growth is anticipated to be twice that amount, at 20% YoY.

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The improvement in purchasing power also opens a window for price adjustments to boost
margins. When compared to their respective 5-year peak gross margins (excluding cigarettes,
considering their margin dynamics influenced by excise hikes, and MIDI, which, due to its
Lawson venture, should allow for higher margins than historical), KLBF, ULTJ, MYOR emerge with
substantial leeway for margin upticks.

Figure 13. Discrepancy of 9M23 gross margin to 5-year historical peak

Discrepancy of 9M23 Gross Gross Discre-

gross margin to 5- margin, margin, pancy to
year historical peak 9M23 5-yr peak 5-yr peak

Staples
MYOR 26.7% 31.6% -4.9%
ICBP 36.3% 36.9% -0.7%
KLBF 39.5% 45.3% -5.8%
UNVR 50.1% 52.3% -2.2%
SIDO 53.7% 56.9% -3.2%
ULTJ 32.5% 37.6% -5.1%
Retailers
MAPI 45.6% 47.7% -2.0%
ACES 48.1% 49.4% -1.2%
ERAA 10.5% 11.1% -0.6%

Source: Trimegah Research

Figure 14. KLBF, ULTJ, and MYOR have room for margin expansions

Source: Trimegah Research

We anticipate that companies with a significant operating leverage effect will derive more
benefits in this scenario. Our operating leverage ratio calculation suggests that HMSP, GGRM,
and MYOR are poised to benefit more from this front.

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Figure 15. Wage-related cost components in 9M23 financials

Cost structure, Percent of Percent of EBIT Operating

variable vs. fixed variable fixed margin, leverage
cost components costs costs 9M23 ratio
Staples
MYOR 86.1% 13.9% 26.7% 1.38
ICBP 83.1% 16.9% 36.3% 1.30
KLBF 83.0% 17.0% 39.5% 1.26
UNVR 83.2% 16.8% 50.1% 1.17
SIDO 84.6% 15.4% 53.7% 1.13
ULTJ 86.4% 13.6% 32.5% 1.28
Cigarettes
HMSP 91.4% 8.6% 16.5% 1.44
GGRM 93.7% 6.3% 14.0% 1.39
Retailers
MAPI 79.7% 20.3% 45.6% 1.24
ACES 82.6% 17.4% 48.1% 1.19
MIDI 90.1% 9.9% 26.0% 1.28
ERAA 97.2% 2.8% 10.5% 1.24

Source: Trimegah Research

A relatively good earnings momentum on the consumer-related space

We tracked the consumer + retail sector’s 4Q revenue and net profit seasonality from 4Q14 to
4Q22. The average 4Q revenue and net profit seasonality over the period were 27% and 30%,
respectively. We expect 4Q23f strong seasonality to continue in 4Q23f with 4Q revenue and net
profit at 29% and 28%, respectively.

Among all the sectors in our Trimegah coverage, the consumer + retail sector has the highest
QoQ growth momentum among other sectors. We estimate the 2024 consumer + retail net profit
growth to book +11% YoY growth, which is similar with the big 4 banks’ growth.

Figure 16. High 4Q historical seasonality in terms of revenue and net profit
Revenue 4Q seasonality
4Q14-4Q22 4Q17-4Q22
4Q14 4Q15 4Q16 4Q17 4Q18 4Q19 4Q20 4Q21 4Q22 4Q23f avg. seasonality avg. seasonality
UNVR 24% 24% 25% 24% 25% 25% 24% 24% 23% 24% 24% 24%
SIDO 27% 26% 26% 28% 30% 31% 32% 31% 32% 28% 29% 31%
HMSP 26% 26% 26% 27% 27% 27% 27% 27% 25% 26% 27% 27%
GGRM 26% 28% 26% 26% 27% 26% 27% 26% 25% 26% 26% 26%
ROTI 28% 28% 27% 27% 28% 26% 24% 26% 27% 28% 27% 26%
MYOR 25% 28% 27% 31% 28% 28% 28% 29% 28% 27% 28% 29%
ICBP 24% 24% 23% 23% 23% 22% 27% 25% 25% 24% 24% 24%
MAPI 27% 27% 27% 28% 27% 29% 32% 34% 30% 28% 29% 30%
ACES 26% 27% 28% 29% 29% 27% 26% 28% 28% 27% 28% 28%
ERAA 28% 36% 24% 31% 27% 28% 32% 28% 29% 26% 29% 29%
Average 26% 27% 26% 27% 27% 27% 28% 28% 27% 27% 27% 27%

Net profit 4Q seasonality

4Q14-4Q22 4Q17-4Q22
4Q14 4Q15 4Q16 4Q17 4Q18 4Q19 4Q20 4Q21 4Q22 4Q23f avg. seasonality avg. seasonality
UNVR 32% 29% 26% 25% 20% 25% 24% 24% 14% 26% 24% 22%
SIDO 25% 25% 26% 26% 28% 28% 31% 31% 35% 34% 28% 30%
HMSP 25% 27% 29% 26% 28% 26% 19% 22% 22% 28% 25% 24%
GGRM 25% 36% 31% 30% 26% 33% 26% 26% 46% 23% 31% 31%
ROTI 30% 29% 27% 37% 59% 30% 41% 26% 39% 34% 35% 39%
MYOR 38% 29% 36% 42% 36% 45% 24% 18% 44% 31% 35% 35%
ICBP 21% 19% 21% 20% 24% 23% 40% 22% 28% 18% 24% 26%
MAPI -47% 27% 42% 26% 24% 31% -9% 119% 29% 26% 27% 37%
ACES 68% 35% 34% 32% 28% 29% 29% 53% 47% 31% 40% 36%
ERAA 14% 27% 28% 34% 25% 44% 52% 29% 33% 30% 32% 36%
Average 23% 28% 30% 30% 30% 31% 28% 37% 34% 28% 30% 32%

Source: Companies, Trimegah Research

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Figure 17. Consumer + retail has the highest QoQ net profit Figure 18. … and one of the highest in terms of YoY
growth among sectors under our Trimegah universe …

4Q23f QoQ net profit growth 4Q23f YoY net profit growth
14% 40% 35%
12% 32%
12%
12% 30% 25%

10% 19%
20%
8%
8% 10%

6% 0%
Telco & tower Consumer + retail Others (exclude Banks Healthcare Commodities &
3% -3%
4% 3% -10% GOTO) energy

2% -20%

0% -30%
Consumer + retail Healthcare Telco & tower Commodities & Banks Others (exclude
-2% energy GOTO) -40%
-38%
-3%
-4% -50%

Source: Trimegah Research Source: Trimegah Research

Figure 19. Our Trimegah universe suggests a +10% 2024 Figure 20. … while consumer + retail to book higher 2024
net profit growth (ex-GOTO, ex-commodities/energy), … net profit growth (similar to big banks’ growth) Vs. our total
coverages

Net profit growth (ex-GOTO, ex- Consumer + retail net profit growth, YoY
commodities/energy), YoY 50%
39%
35% 40%
29%
30% 27%
30%
25%
17% 20%
20% 11%
15% 10%
10%
10% 0%
5% 2021-9% 2022 -12% 2023f 2024f
-10%
0%
2021 2022 2023f 2024f -20%

Net profit growth (ex-GOTO, ex-commodities/energy), YoY Consumer + retail net profit growth, YoY

Source: Companies, Trimegah Research Coverages Source: Companies, Trimegah Research Coverages

Figure 21. Consumer + retail Vs. Big 4 banks have similar Figure 22. Market cap contribution of consumer + retail Vs.
2024 net profit growth banks to total JCI has shown a slight convergence over the
past ~2 years

45%
39%
40%
Sector contribution to JCI market cap
40.0%
35% 35.4%
35.0% 32.9% 33.5%
31.8% 32.0%
30% 28.7%
30.0% 27.5%
25% 24.6%
22.8% 23.2% 23.1%
25.0% 22.3% 21.5%
19.3% 20.0%
20% 20.0% 16.8%
15.6% 15.4% 14.5% 13.4%
15% 11% 15.0% 12.2%
13.4%

10% 10.0%

5% 5.0%

0.0%
0% End-13 End-14 End-15 End-16 End-17 End-18 End-19 End-20 End-21 End-22 Present
2023f 2024f Banks-related Consumer + retail

Consumer + retail net profit growth, YoY Big 4 banks net profit growth, YoY

Source: Companies, Trimegah Research Coverages Source: Companies, Trimegah Research Coverages

PT Trimegah Sekuritas Indonesia Tbk – www.trimegah.com 9

Sensitivity of minimuim wage hike to our consumer top picks
We conducted a sensitivity analysis to calculate the potential effects of a minimum wage increase
on the net profit of consumer companies. This process included examining the historical
multiplier effect between sales and minimum wage growth, while also accounting for the
expenses tied to salaries and labor. Overall, our top picks seem to benefit from higher minimum
wage adjustments, with the sensitivity as follow.

Figure 23. 2024F net profit growth sensitivity to adjustments in minimum wage

2024F net
MYOR ICBP HMSP MIDI GGRM
profit growth
+2% 11.1% 10.0% 7.0% 15.9% 3.7%
adjustments
Min. wage

+4% 14.6% 12.5% 9.6% 19.1% 5.6%

(Base) +6% 18.1% 15.0% 12.1% 22.4% 7.6%
+8% 21.6% 17.5% 14.7% 25.7% 9.6%
+10% 25.1% 20.0% 17.3% 28.9% 11.5%

Source: Trimegah Research

Undemanding valuation, despite positive results momentum

Further noteworthy is the current attractive P/E valuation multiples of consumer companies.
Historically, staple stocks traded at a median forward P/E of 24-27x, in contrast to the current
ratio at 19x. Similarly, retailers traded at a median ratio of 20-21 forward P/E, while the current
figure stands at 13x. As catalysts align and valuations stay undemanding, consumer becomes an
enticing choice on the menu.

Figure 24. Historical valuation premium/discount to current valuation multiple

Premium/discount Valuation discount/premium to …

Fwd. P/E, Fwd. P/E, Fwd. P/E, Fwd. P/E,
to current valuation
2013-16 2017-20 2021-22 current 2013-16 2017-20 2021-22
multiple

Average minimum
+15% +9% +1%
wage adjustment
Staples 24.4 27.0 23.6 19.4 -20% -28% -18%
MYOR 24.4 27.0 27.9 18.7 -23% -31% -33%
ICBP 21.5 23.3 17.3 13.8 -36% -41% -20%
KLBF 31.0 28.9 23.6 33.3 7% 15% 41%
UNVR 39.5 46.3 37.9 27.7 -30% -40% -27%
SIDO 22.9 15.5 22.0 28.2 - 81% 28%
ULTJ 22.7 17.2 14.5 13.6 -40% -21% -6%
Cigarettes 23.4 25.2 17.1 10.2 -57% -60% -40%
HMSP 28.1 34.1 20.1 12.3 -56% -64% -39%
GGRM 18.8 16.3 14.0 8.1 -57% -50% -42%
Retailers 19.7 20.5 18.9 13.3 -32% -35% -30%
MAPI 76.6 37.2 20.7 13.0 -83% -65% -37%
ACES 21.9 24.3 31.5 13.7 -37% -44% -57%
MIDI 17.6 16.7 17.1 23.1 31% 38% 35%
ERAA 15.4 8.2 8.1 9.5 -38% 16% 18%

Source: Trimegah Research

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APPENDIX
Figure 25. Vision and mission of Presidential candidates

Source: Presidential candidates, Trimegah research

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Figure 26. JCI is trading at -18% discount to 5-years historical forward P/E …

(x)
22.00

20.00

18.00

16.00

14.00

12.00

10.00

8.00
May-19

May-20

May-21

May-22

May-23
Nov-21
Feb-19

Feb-20

Feb-21

Feb-22

Feb-23
Nov-18

Nov-19

Nov-20

Nov-22
Aug-19

Aug-20

Aug-21

Aug-22

Aug-23
1 year-forward JCI P/E Average

Source: Bloomberg, Trimegah Research

Figure 27. Net profit growth (exclude commodity & tech) has decelerated from 2021’s +35% growth, to +24%/+17%/+10.5%
2022/23f/24f respectively

Revenue Growth (%) Net Profit Growth (%)

Source: Trimegah Research coverage Source: Trimegah Research coverage

Revenue Growth ex-commod. & tech/digi. (%) Net Profit ex-commod. & tech/digi. Growth (%)

20.0% 40.0% 34.8%

14.9% 30.0% 24.2%

15.0% 13.4%
17.0%
20.0%
8.9% 10.5%
9.4% 10.0%
10.0%
7.2% 6.8%
0.0%

5.0%
-10.0%

-20.0%
0.0% -27.2%
-2.6%
-30.0%

-5.0% -40.0%
2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024

Source: Trimegah Research coverage Source: Trimegah Research coverage

Source: Companies, Trimegah research

PT Trimegah Sekuritas Indonesia Tbk – www.trimegah.com 12

Research Team
Willinoy Sitorus
Fakhrul Fulvian
Adi Prabowo
Heribertus Ariando
Richardson Raymond
Kharel Devin Fielim
Alpinus Dewangga
Ignatius Samon
Sabrina
Jonathan Gunawan
Alberto Jonas Kusuma
Corporate Access
Nur Marini
Institutional Sales Team
Beatrix Susanto
Henry Sidarta, CFTe
Calvina Karmoko
Stefanus Indarto
Morgan Gindo
Retail Sales Team
Billy Budiman
Hasbie Sukaton
Jakarta Area
Ignatius Candra Perwira
Robby Jauhari
Sumatera
Alfon Ariapati
Eastern Indonesia
Carlo Ernest Frits Coutrier
East Java
Pandu Wibisono
Central Java, Area
Aloysius Primasyah
Laili Ma’muroh
West Java
Bhisma Herlambang
Renny Nurhayati Hidayat
PT Trimegah Sekuritas Indonesia Tbk – www.trimegah.com
Head of Research, Strategy willinoy.sitorus@trimegah.com +62-21 2924 9105
Economics, Fixed Income fakhrul.fulvian@trimegah.com +62-21 2924 9097
Banks, and Financial-related adi.prabowo@trimegah.com +62-21 2924 9107
Consumer, Media and Healthcare heribertus.ariando@trimegah.com +62-21 2924 9106
Telco, Tower, and Digital Media richardson.raymond@trimegah.com +62-21 2924 6325
Property, CPO, Cement, Toll, Small Caps kharel.devin@trimegah.com +62-21 2924 9106
Commodities, Auto, and Small Caps alpinus.raditya@trimegah.com +62-21 2924 6322
Consumer, Healthcare and Media & Tech ignatius.samon@trimegah.com +62-21 2924 9143
Telco, Tower, and Digital Media sabrina@trimegah.com +62-21 2924 9018
Economics and Fixed Income jonathan.gunawan@trimegah.com +62-21 2924 9096
Commodities, Auto, and Small Caps alberto.kusuma@trimegah.com +62-21 2924 9103
Corporate Access marini@trimegah.com +62-21 2924 6323
Head of Institutional Sales beatrix.susanto@trimegah.com +62-21 2924 9086
Head of Institutional Dealing henry.sidarta@trimegah.com +62-21 3043 6309
Equity Institutional Sales calvina.karmoko@trimegah.com +62-21 2924 9080
Equity Institutional Sales stefanus.indarto@trimegah.com +62-21 2924 9080
Equity Institutional Sales morgan.gindo@trimegah.com +62-21 2924 9076
Head of Retail Equity Sales billy.budiman@trimegah.com +62-21 3043 6310
Deputy Head of Retail Sales hasbie.sukaton@trimegah.com +62-21 2924 9088
Kelapa Gading, Jakarta ignatius.perwira@trimegah.com +62-21 8061 7270
BSD, Jakarta robby.jauhari@trimegah.com +62-21 5089 8959
Medan, Sumatera Utara alfon.ariapati@trimegah.com +62-61 4100 0000
Makasar, Sulawesi Selatan carlo.coutrier@trimegah.com +62-411 3604 379
Surabaya, Jawa Timur pandu.wibisono@trimegah.com +62-31 2973 18000
Semarang, Jawa Tengah primasyah.kristanto@trimegah.com +62-24 8600 2310
Solo, Jawa Tengah laili.mamuroh@trimegah.com +62-271 6775 590
Bandung, Jawa Barat bhisma.herlambang@trimegah.com +62-22 8602 6290
Cirebon, Jawa Barat renny.nurhayati@trimegah.com +62-231 8851 009
13
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Buy : Share price is expected to exceed more than 10% over the next 12 months
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 Analysts Certification

The research analyst(s) of PT Trimegah Sekuritas Indonesia Tbk. primarily responsible for the content of this research
report, in whole or in part, certifies that with respect to the companies or relevant securities that the analyst(s) covered in
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The disclosure column in the following table lists the important disclosures applicable to each company that has been rated
and/or recommended in this report:

Company Ticker Disclosure (as applicable)

MYOR -
KLBF -
ICBP -
CMRY -
UNVR -
SIDO -
GGRM -
HMSP -

Trimegah Disclosure Data

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1. Within the past year, it has managed or co-managed a public offering for this company, for which it received fees.
2. It had an investment banking relationship with this company in the last 12 months.
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company or has received compensation from the company.

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