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24% Upside, BUY
22 April 2022
Price Rp 1600
Target price Rp 1980
Investment Consideration
Double-digit Growth Maintained
- KLBF maintained double-digit growth in 4Q2021 with sales of IDR 7.16 trillion, the highest quarter in 2021 and up +19% YoY or +6.45% QoQ. For 2021FY, KLBF net sales increased +13.6% YoY to IDR 26.2 trillion.
- Most of KLBF’s business segments recorded positive growth in 2021.
- Distribution & logistics recorded growth of +26% YoY to IDR 9.75 trillion and is still the largest contributor to total sales. Distribution & logistics GPM increased to 25% from 24.8% due to a better product mix.
- Pharmaceuticals sales recorded 14.8% YoY growth to IDR 5.7 trillion while the GPM declined to 52.8% from 53.4% due also to the product mix.
- Nutrition recorded positive growth of +2.5% to IDR 7.16 trillion with the GPM declining to 51.5% from 53%.
- Consumer health also grew +7.1% YoY to IDR 3.6 trillion with a higher GPM of 50.9% from 57.8%.
- We expect KLBF will maintain double-digit sales growth as demand continues to grow. We are targeting KLBF 2022F sales to reach IDR 29.1 trillion or +11% growth.
4Q2021: Higher Margin
- Inline with double-digit growth in sales, KLBF also maintained double digit net income growth in 4Q2021, up +27% YoY or +13% QoQ to IDR 896 billion with a higher NPM of 12.5%. For 2021, KLBF recorded a net profit increase of +16% YoY to IDR 3.18 trillion with a slightly higher NPM of 12.1%.
- KLBF gross profit increased +21% YoY or +4% QoQ in 4Q2021 to IDR 3.0 trillion with COGS increasing +17% YoY due to higher commodity prices and raw material costs. This resulted in a slightly lower gross profit margin of 41.9%.
- Operating profit increased by +24% YoY to IDR 1.16 trillion with a higher operating profit margin of 16.3%.
- We are forecasting KLBF 2022F net profit to grow double digit +13% YoY to reach IDR 3.58 trillion.
Valuation: BUY TP 1,980 with 24% upside
- We are targeting KLBF to trade at 23x PE within a year. Target Price is IDR 1,980 which represents 24% upside. We maintained our recommendation to BUY.