Opportunity in the Midst of Pandemic
Covid 19 Update
• The highest daily case of Covid 19 was at 27 913 on Saturday, July 3 2021 In total, positive cases of Coivid 19 outbreak nationally reached 2 084 284 cases (04 July 2021)
• Reflecting on India, the daily case of Covid 19 have increased from an average of 40 000 to 400 000 It might happen to Indonesia if there are no appropriate anticipatory steps The Increase of Oxygen Demand
• Covid 19 cases affects on demand oxygen for medical purposes 90 of domestic oxygen production is allocated for medical purposes Based on data from the Ministry of Industry, the average utility of industrial oxygen gas reached 80 of the installed capacity of 866 1 million kg as of June 21
Quite a Performance
• AGII's revenue grew by 18% YoY in 1Q21 to IDR642.70 billion (vs. IDR544.43 billion 1Q20). Increase in sales of gas products by 11.31% YoY of IDR595.63 billion (vs. IDR499.27 billion 1Q20) has supported the topline growth. While the health and medical segment contributed 28%-30% of AGII's revenue in 1Q21.
• The successful efficiency strategy on opex has boost the growth on net profit by 160.21% YoY to Rp49.37 billion 1Q21.
• CIn FY21E, capex is budgeted at IDR 200-250 billion, which will be allocated for maintenance. Meanwhile, management targets 7%-10% net profit growth in FY21E
Valuation and Recommendation: NOT RATED
We saw AGII has the opportunity to improve the financial performance in FY21E tremendously as the need for the health and medical segment increases. FY21E's performance will be driven by the demand toward oxygen for medical purposes in the midst of a surge in Covid-19 cases. AGII is currently trading at 24.69x/1.44x PE/PBV levels.
