Gudang Garam

Gudang Garam is a kretek (clove cigarette) manufacturing group based in Indonesia. Co. is principally engaged in the production, sale and export of clove cigarettes and related products, primarily under the Gudang Garam brand name. Co.'s operations are organized along two business segments comprising: Cigarettes and Paperboard. Co. produces a range of kretek, including traditional hand-rolled kretek, machine-made kretek and low-tar, low-nicotine variants. Co. is also engaged in the operation and maintenance of tobacco and clove plantations. In addition, Co. supplies folding boxboard for use in cigarette packaging and is involved in trading services. Co. operates predominantly in Indonesia.
  • TickerGGRM
  • ISINID1000068604
  • ExchangeIndonesian Stock Exchange
  • SectorTobacco
  • CountryIndonesia
Stevanus Juanda ... (+2)
  • Stevanus Juanda
  • Maskun Ramli
GGRM GUDANG GARAM (Personal & Household Goods)

Indonesia Daily - Thursday, August 12, 2021

Update Gudang Garam (GGRM IJ/BUY/Rp32,575/Target: Rp36,200) GGRM’s price increases are trailing that of its competitors. Maintain BUY. Aneka Tambang (ANTM IJ): Technical BUY Indocement Tunggal Prakarsa (INTP IJ): Technical BUY

Stevanus Juanda
  • Stevanus Juanda
GGRM GUDANG GARAM (Personal & Household Goods)

Gudang Garam (GGRM IJ) - GGRM’s Price Increases Trailing That Of Compe...

Our channel checks show that competitors are raising prices at a larger magnitude than GGRM. GGRM is exposed to an 18.4% excise tax increase in machine rolled cigarettes, which accounted for 93.1% of 1H21 sales. This led to a nearly 40% yoy drop in GGRM’s 1H21 EPS, compared with HMSP’s 15.4% decline. A marginal 2.3% fall in industry sales volume in 1H21 was recorded. We forecast net income to rise from Rp4,675b in 2021 to Rp8,473b in 2022. Maintain BUY. Target price: Rp36,200.

GGRM GUDANG GARAM (Personal & Household Goods)

GUDANG GARAM with less fundamental stars is reduced to Neutral

GUDANG GARAM (ID), a company active in the Tobacco industry, loses a star(s) at the fundamental level and sees its general evaluation downgraded. The independent financial analyst theScreener just removed a fundamental star(s) for a 2 over 4-star rating. As such, market behaviour remains unchanged and is evaluated as moderately risky. theScreener believes that the loss of a star(s) merits downgrade to the general evaluation of the title, which passes to Neutral. As of the analysis date July 20, 2021, the closing price was IDR 37,400.00 and its expected value was estimated at IDR 38,554.24.

Stevanus Juanda
  • Stevanus Juanda
GGRM GUDANG GARAM (Personal & Household Goods)

Gudang Garam (GGRM IJ) - 1Q21: Underperformed Compared With HMSP; In l...

1Q21 net income fell 28.6% yoy and 12.7% qoq, below our expectation but in line with the street’s. GGRM’s performance in 1Q21 was below HMSP’s (55.4% qoq growth in net income in 1Q21). The main reason was that 1Q21 gross margin shrank 102bp at GGRM, while gross margin at HMSP expanded 297bp. We cut our 2021 net income forecast by 13.3% and apply a -1SD historical five-year average PE of 11.0x to derive our target price of Rp48,500 (37% upside). Maintain BUY.

Tanadech Rungsrithananon ... (+6)
  • Tanadech Rungsrithananon
  • Keith Wee Teck Keong
  • Jonathan Koh
  • Raphon Prima
  • Maskun Ramli
  • Stevanus Juanda
GGRM GUDANG GARAM (Banks)
BBRI Bank Rakyat Ind... (Personal & Household Goods) ... (+7)

Indonesia Daily - Thursday, May 6, 2021

Banks - Regional: ASEAN banks: Monthly update. Gudang Garam (GGRM IJ/BUY/Rp35,400/Target: Rp48,500): 1Q21: Underperformed compared with HMSP; in line with consensus estimates. TRADERS’ CORNER XL Axiata (EXCL IJ): Technical BUY PP London Sumatra Indonesia (LSIP IJ): Technical BUY

Stevanus Juanda ... (+2)
  • Stevanus Juanda
  • Maskun Ramli
GGRM GUDANG GARAM (Personal & Household Goods)

Indonesia Daily - Thursday, August 12, 2021

Update Gudang Garam (GGRM IJ/BUY/Rp32,575/Target: Rp36,200) GGRM’s price increases are trailing that of its competitors. Maintain BUY. Aneka Tambang (ANTM IJ): Technical BUY Indocement Tunggal Prakarsa (INTP IJ): Technical BUY

Stevanus Juanda
  • Stevanus Juanda
GGRM GUDANG GARAM (Personal & Household Goods)

Gudang Garam (GGRM IJ) - GGRM’s Price Increases Trailing That Of Compe...

Our channel checks show that competitors are raising prices at a larger magnitude than GGRM. GGRM is exposed to an 18.4% excise tax increase in machine rolled cigarettes, which accounted for 93.1% of 1H21 sales. This led to a nearly 40% yoy drop in GGRM’s 1H21 EPS, compared with HMSP’s 15.4% decline. A marginal 2.3% fall in industry sales volume in 1H21 was recorded. We forecast net income to rise from Rp4,675b in 2021 to Rp8,473b in 2022. Maintain BUY. Target price: Rp36,200.

GGRM GUDANG GARAM (Personal & Household Goods)

GUDANG GARAM with less fundamental stars is reduced to Neutral

GUDANG GARAM (ID), a company active in the Tobacco industry, loses a star(s) at the fundamental level and sees its general evaluation downgraded. The independent financial analyst theScreener just removed a fundamental star(s) for a 2 over 4-star rating. As such, market behaviour remains unchanged and is evaluated as moderately risky. theScreener believes that the loss of a star(s) merits downgrade to the general evaluation of the title, which passes to Neutral. As of the analysis date July 20, 2021, the closing price was IDR 37,400.00 and its expected value was estimated at IDR 38,554.24.

Stevanus Juanda
  • Stevanus Juanda
GGRM GUDANG GARAM (Personal & Household Goods)

Gudang Garam (GGRM IJ) - 1Q21: Underperformed Compared With HMSP; In l...

1Q21 net income fell 28.6% yoy and 12.7% qoq, below our expectation but in line with the street’s. GGRM’s performance in 1Q21 was below HMSP’s (55.4% qoq growth in net income in 1Q21). The main reason was that 1Q21 gross margin shrank 102bp at GGRM, while gross margin at HMSP expanded 297bp. We cut our 2021 net income forecast by 13.3% and apply a -1SD historical five-year average PE of 11.0x to derive our target price of Rp48,500 (37% upside). Maintain BUY.

Tanadech Rungsrithananon ... (+6)
  • Tanadech Rungsrithananon
  • Keith Wee Teck Keong
  • Jonathan Koh
  • Raphon Prima
  • Maskun Ramli
  • Stevanus Juanda
GGRM GUDANG GARAM (Banks)
BBRI Bank Rakyat Ind... (Personal & Household Goods) ... (+7)

Indonesia Daily - Thursday, May 6, 2021

Banks - Regional: ASEAN banks: Monthly update. Gudang Garam (GGRM IJ/BUY/Rp35,400/Target: Rp48,500): 1Q21: Underperformed compared with HMSP; in line with consensus estimates. TRADERS’ CORNER XL Axiata (EXCL IJ): Technical BUY PP London Sumatra Indonesia (LSIP IJ): Technical BUY

Stevanus Juanda ... (+2)
  • Stevanus Juanda
  • Maskun Ramli
GGRM GUDANG GARAM (Personal & Household Goods)

Indonesia Daily - Thursday, August 12, 2021

Update Gudang Garam (GGRM IJ/BUY/Rp32,575/Target: Rp36,200) GGRM’s price increases are trailing that of its competitors. Maintain BUY. Aneka Tambang (ANTM IJ): Technical BUY Indocement Tunggal Prakarsa (INTP IJ): Technical BUY

Stevanus Juanda
  • Stevanus Juanda
GGRM GUDANG GARAM (Personal & Household Goods)

Gudang Garam (GGRM IJ) - GGRM’s Price Increases Trailing That Of Compe...

Our channel checks show that competitors are raising prices at a larger magnitude than GGRM. GGRM is exposed to an 18.4% excise tax increase in machine rolled cigarettes, which accounted for 93.1% of 1H21 sales. This led to a nearly 40% yoy drop in GGRM’s 1H21 EPS, compared with HMSP’s 15.4% decline. A marginal 2.3% fall in industry sales volume in 1H21 was recorded. We forecast net income to rise from Rp4,675b in 2021 to Rp8,473b in 2022. Maintain BUY. Target price: Rp36,200.

GGRM GUDANG GARAM (Personal & Household Goods)

GUDANG GARAM with less fundamental stars is reduced to Neutral

GUDANG GARAM (ID), a company active in the Tobacco industry, loses a star(s) at the fundamental level and sees its general evaluation downgraded. The independent financial analyst theScreener just removed a fundamental star(s) for a 2 over 4-star rating. As such, market behaviour remains unchanged and is evaluated as moderately risky. theScreener believes that the loss of a star(s) merits downgrade to the general evaluation of the title, which passes to Neutral. As of the analysis date July 20, 2021, the closing price was IDR 37,400.00 and its expected value was estimated at IDR 38,554.24.

Stevanus Juanda
  • Stevanus Juanda
GGRM GUDANG GARAM (Personal & Household Goods)

Gudang Garam (GGRM IJ) - 1Q21: Underperformed Compared With HMSP; In l...

1Q21 net income fell 28.6% yoy and 12.7% qoq, below our expectation but in line with the street’s. GGRM’s performance in 1Q21 was below HMSP’s (55.4% qoq growth in net income in 1Q21). The main reason was that 1Q21 gross margin shrank 102bp at GGRM, while gross margin at HMSP expanded 297bp. We cut our 2021 net income forecast by 13.3% and apply a -1SD historical five-year average PE of 11.0x to derive our target price of Rp48,500 (37% upside). Maintain BUY.

Tanadech Rungsrithananon ... (+6)
  • Tanadech Rungsrithananon
  • Keith Wee Teck Keong
  • Jonathan Koh
  • Raphon Prima
  • Maskun Ramli
  • Stevanus Juanda
GGRM GUDANG GARAM (Banks)
BBRI Bank Rakyat Ind... (Personal & Household Goods) ... (+7)

Indonesia Daily - Thursday, May 6, 2021

Banks - Regional: ASEAN banks: Monthly update. Gudang Garam (GGRM IJ/BUY/Rp35,400/Target: Rp48,500): 1Q21: Underperformed compared with HMSP; in line with consensus estimates. TRADERS’ CORNER XL Axiata (EXCL IJ): Technical BUY PP London Sumatra Indonesia (LSIP IJ): Technical BUY

Stevanus Juanda ... (+2)
  • Stevanus Juanda
  • Maskun Ramli
GGRM GUDANG GARAM (Personal & Household Goods)

Indonesia Daily - Thursday, August 12, 2021

Update Gudang Garam (GGRM IJ/BUY/Rp32,575/Target: Rp36,200) GGRM’s price increases are trailing that of its competitors. Maintain BUY. Aneka Tambang (ANTM IJ): Technical BUY Indocement Tunggal Prakarsa (INTP IJ): Technical BUY

Stevanus Juanda
  • Stevanus Juanda
GGRM GUDANG GARAM (Personal & Household Goods)

Gudang Garam (GGRM IJ) - GGRM’s Price Increases Trailing That Of Compe...

Our channel checks show that competitors are raising prices at a larger magnitude than GGRM. GGRM is exposed to an 18.4% excise tax increase in machine rolled cigarettes, which accounted for 93.1% of 1H21 sales. This led to a nearly 40% yoy drop in GGRM’s 1H21 EPS, compared with HMSP’s 15.4% decline. A marginal 2.3% fall in industry sales volume in 1H21 was recorded. We forecast net income to rise from Rp4,675b in 2021 to Rp8,473b in 2022. Maintain BUY. Target price: Rp36,200.

GGRM GUDANG GARAM (Personal & Household Goods)

GUDANG GARAM with less fundamental stars is reduced to Neutral

GUDANG GARAM (ID), a company active in the Tobacco industry, loses a star(s) at the fundamental level and sees its general evaluation downgraded. The independent financial analyst theScreener just removed a fundamental star(s) for a 2 over 4-star rating. As such, market behaviour remains unchanged and is evaluated as moderately risky. theScreener believes that the loss of a star(s) merits downgrade to the general evaluation of the title, which passes to Neutral. As of the analysis date July 20, 2021, the closing price was IDR 37,400.00 and its expected value was estimated at IDR 38,554.24.

Stevanus Juanda
  • Stevanus Juanda
GGRM GUDANG GARAM (Personal & Household Goods)

Gudang Garam (GGRM IJ) - 1Q21: Underperformed Compared With HMSP; In l...

1Q21 net income fell 28.6% yoy and 12.7% qoq, below our expectation but in line with the street’s. GGRM’s performance in 1Q21 was below HMSP’s (55.4% qoq growth in net income in 1Q21). The main reason was that 1Q21 gross margin shrank 102bp at GGRM, while gross margin at HMSP expanded 297bp. We cut our 2021 net income forecast by 13.3% and apply a -1SD historical five-year average PE of 11.0x to derive our target price of Rp48,500 (37% upside). Maintain BUY.

Tanadech Rungsrithananon ... (+6)
  • Tanadech Rungsrithananon
  • Keith Wee Teck Keong
  • Jonathan Koh
  • Raphon Prima
  • Maskun Ramli
  • Stevanus Juanda
GGRM GUDANG GARAM (Banks)
BBRI Bank Rakyat Ind... (Personal & Household Goods) ... (+7)

Indonesia Daily - Thursday, May 6, 2021

Banks - Regional: ASEAN banks: Monthly update. Gudang Garam (GGRM IJ/BUY/Rp35,400/Target: Rp48,500): 1Q21: Underperformed compared with HMSP; in line with consensus estimates. TRADERS’ CORNER XL Axiata (EXCL IJ): Technical BUY PP London Sumatra Indonesia (LSIP IJ): Technical BUY

Stevanus Juanda ... (+2)
  • Stevanus Juanda
  • Maskun Ramli
GGRM GUDANG GARAM (Personal & Household Goods)

Indonesia Daily - Thursday, August 12, 2021

Update Gudang Garam (GGRM IJ/BUY/Rp32,575/Target: Rp36,200) GGRM’s price increases are trailing that of its competitors. Maintain BUY. Aneka Tambang (ANTM IJ): Technical BUY Indocement Tunggal Prakarsa (INTP IJ): Technical BUY

Stevanus Juanda
  • Stevanus Juanda
GGRM GUDANG GARAM (Personal & Household Goods)

Gudang Garam (GGRM IJ) - GGRM’s Price Increases Trailing That Of Compe...

Our channel checks show that competitors are raising prices at a larger magnitude than GGRM. GGRM is exposed to an 18.4% excise tax increase in machine rolled cigarettes, which accounted for 93.1% of 1H21 sales. This led to a nearly 40% yoy drop in GGRM’s 1H21 EPS, compared with HMSP’s 15.4% decline. A marginal 2.3% fall in industry sales volume in 1H21 was recorded. We forecast net income to rise from Rp4,675b in 2021 to Rp8,473b in 2022. Maintain BUY. Target price: Rp36,200.

GGRM GUDANG GARAM (Personal & Household Goods)

GUDANG GARAM with less fundamental stars is reduced to Neutral

GUDANG GARAM (ID), a company active in the Tobacco industry, loses a star(s) at the fundamental level and sees its general evaluation downgraded. The independent financial analyst theScreener just removed a fundamental star(s) for a 2 over 4-star rating. As such, market behaviour remains unchanged and is evaluated as moderately risky. theScreener believes that the loss of a star(s) merits downgrade to the general evaluation of the title, which passes to Neutral. As of the analysis date July 20, 2021, the closing price was IDR 37,400.00 and its expected value was estimated at IDR 38,554.24.

Stevanus Juanda
  • Stevanus Juanda
GGRM GUDANG GARAM (Personal & Household Goods)

Gudang Garam (GGRM IJ) - 1Q21: Underperformed Compared With HMSP; In l...

1Q21 net income fell 28.6% yoy and 12.7% qoq, below our expectation but in line with the street’s. GGRM’s performance in 1Q21 was below HMSP’s (55.4% qoq growth in net income in 1Q21). The main reason was that 1Q21 gross margin shrank 102bp at GGRM, while gross margin at HMSP expanded 297bp. We cut our 2021 net income forecast by 13.3% and apply a -1SD historical five-year average PE of 11.0x to derive our target price of Rp48,500 (37% upside). Maintain BUY.

Tanadech Rungsrithananon ... (+6)
  • Tanadech Rungsrithananon
  • Keith Wee Teck Keong
  • Jonathan Koh
  • Raphon Prima
  • Maskun Ramli
  • Stevanus Juanda
GGRM GUDANG GARAM (Banks)
BBRI Bank Rakyat Ind... (Personal & Household Goods) ... (+7)

Indonesia Daily - Thursday, May 6, 2021

Banks - Regional: ASEAN banks: Monthly update. Gudang Garam (GGRM IJ/BUY/Rp35,400/Target: Rp48,500): 1Q21: Underperformed compared with HMSP; in line with consensus estimates. TRADERS’ CORNER XL Axiata (EXCL IJ): Technical BUY PP London Sumatra Indonesia (LSIP IJ): Technical BUY

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