Report
EUR 88.49
For Business Accounts Only
Avia Avian (AA) is a paint manufacturer and retailer in Indonesia. The company is the market leader in Indonesia’ decorative paint and coating industry with a market share of about 20% based on FY20 revenue, as per Frost & Sullivan (F&S).
The company is well-run as evidenced by its resilient revenue amidst the height of pandemic in FY20 and the stable margins over the past four years. It has a vertically integrated business, from producing a significant proportion of raw material in-house to owning its own distribution network.
AA is offered at 32.1 - 38.3x FY22 and 29.1 - 34.8x FY23 P/E which we think is reasonable and should trade towards 44.7x and 38.5x FY22 and FY23 P/E ratios, respectively, based on selected peers’ average. This implies a 17 - 53% potential upside.
In this note, we will look at company’s fundamentals, deal dynamics, assumptions, and share our thoughts on valuation.
Avia Avian IPO - Leader in Indonesia paint industry with undemanding valuation
Avia Avian is looking to raise up to US$772m in its Indonesia IPO.Avia Avian (AA) is a paint manufacturer and retailer in Indonesia. The company is the market leader in Indonesia’ decorative paint and coating industry with a market share of about 20% based on FY20 revenue, as per Frost & Sullivan (F&S).
The company is well-run as evidenced by its resilient revenue amidst the height of pandemic in FY20 and the stable margins over the past four years. It has a vertically integrated business, from producing a significant proportion of raw material in-house to owning its own distribution network.
AA is offered at 32.1 - 38.3x FY22 and 29.1 - 34.8x FY23 P/E which we think is reasonable and should trade towards 44.7x and 38.5x FY22 and FY23 P/E ratios, respectively, based on selected peers’ average. This implies a 17 - 53% potential upside.
In this note, we will look at company’s fundamentals, deal dynamics, assumptions, and share our thoughts on valuation.
Underlying
PT Avia Avian
Provider
Aequitas Research
Aequitas Research is a leading ECM research firm with a focus on IPOs and placements/follow-on offerings across the Asia Pacific with deal size of over USD100m.
Since 2015, we have covered 400+ IPOs and 450+ placements with a hit rate of 73% and 65%, respectively. We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic analysis.
Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis. We also provide a more quant driven analysis on placement/follow-on offerings.
Markets that we cover include:
Hong Kong,
China ADRs,
India,
Japan,
Australia, and
ASEAN.
Hong Kong,
China ADRs,
India,
Japan,
Australia, and
ASEAN.
Zhen Zhou Toh
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