First Half Results & Outlook: Salim Plantations
Salim Ivomas (SIMP) and its subsidiary PP London Sumatra (LSIP) have just released their first half 2016 financials. Like peers, these companies suffered from falling prices and volume of palm oil and natural rubber. Prices fell from global supply-demand balance, while volume was hit by El Nino effects.
Indo Tambangraya & Bet on Coal Recovery
Indo Tambangraya Megah (ITMG), coal producer controlled by Banpu Plc (Thailand), is among the best performing stocks with 117% gain year-to-date as equity investors speculated on recovery of thermal coal market. Fundamentals of coal producers, including ITMG, in the first half, however, were still under significant pressures. ITMG, for example, reported 37.1% fall in net profit.
Marthen Amtiran & Kupang Manganese Smelter
ASX-listed company Gulf Manganese Corporation (GMC) Ltd informed market participants Friday (Aug 5) that it has entered into a binding term sheet with Marthen Amtiran for the investment of US$10 million in Gulf’s Indonesian-based subsidiary PT Gulf Mangan Group. Who is Amtiran?
Q&A with Bukit Asam CEO
Bukit Asam (PTBA), the state coal producer, which has aggressively expanded into power generation business, is among the best performing stocks with 136% gain year-to-date despite persistent weakness in the thermal coal market. In the first half of 2016, PTBA’s net profit declined by 10.5% to Rp712 billion, dragged down by weaker performance in the second quarter. Investors, however, were betting on bottoming out of coal.
Plantation Shares & CPO Outlook
Shares of plantation companies opened mostly higher grounds in Jakarta, Kuala Lumpur, and Singapore this morning to respond yesterday’s significant gain of crude palm oil (CPO). Like CPO, which retreated from above US$700 to US$650 per ton (CIF) in Rotterdam in the past few weeks, plantation shares have also left their recent highs.
Salim-Daitocacao in Chocolate Business
PT Salim Ivomas Pratama (SIMP) Tbk, member of Salim Group, has entered into a memorandum of understanding with Japanese company Daitocacao Co Ltd to start a collaboration discussion towards establishment of a joint venture in Indonesia for manufacturing and marketing of chocolate products for commercial use.
Q&A with Adaro Energy
Adaro Energy (ADRO) is among the best performers on IDX with 115% gain year-to-date. Investors were bet on further recovery of coal market following production cuts in China, Indonesia, and the United States. Unlike other players, ADRO used the low price environment to proceed with expansion programs in power generation and metallurgical coal.
Q&A with Astra Agro Lestari
Astra Agro Lestari (AALI) lost 34% its value from recent high due to persistent weakness in the palm oil market. AALI, one of the largest CPO producers in the region, reported 12.2% decline in sales revenue and 18.6% fall in operating profit in the first half. Will second half of the year be better? Will government’s moratorium for new palm oil planting help? Plans to develop more downstream products?
Coal Price: Bottoming Out?
Reference price of Indonesian thermal coal for August 2016 is set at US$58.37 per ton for CV 6322 Kcal/Kg GAR, 1.3% lower than August 2015, but 10% above July 2016. The commodity has gained 14% since May 2016, prompting some to believe in a bottoming out. Really?
First Half Results & Outlook: Coal Miners
Recent rally in thermal coal prices contributed to gains of some coal producers listed on Indonesia Stock Exchange (IDX). Some of them have gained more than 100% from their recent lows even though pressures on coal market might still be around for quite sometime.