Company Update

09 Juni 2020

KPIG - MNC Sekuritas Equity Report 09 June 2020


Tourism, Restaurant, and Hotel Sector


Growing by Innovating


Solid Performance backed by Office Space Rental as well as Security & Other Services

KPIG recorded a revenue growth of 7.47% YoY amounting to IDR1.07 trillion in FY19 (vs IDR992.45 billion in FY18). This was driven by Office Space Rental followed by Security and other Services segments which increased by 12.18%/32.80% YoY each and contributing 17.44%/33.23% to total revenue in FY19. On the other hand, the cost of revenue also increased by 17.74% YoY, which caused gross profit to slipped by 6.18% YoY with GPM at 37.48% in FY19 (vs 42.94% in FY18). Furthermore, EBITDA recorded an increase of 15.75% YoY reaching IDR178.92 billion (vs IDR154.58 billion in FY18) with EBITDA margin at a level of 16.77%, due to an efficiency in general and administrative expenses by 15.95% YoY in FY19.


MNC Lido City: Strategic and Integrated with World-class Facilities & Services

Currently KPIG still focuses on developing MNC Lido City, a total land bank of 2,000 ha in Lido, Bogor. With potential transformation to Special Economic Zone (KEK), it will provide advantages such as reduced tax rates and other economic benefits. Furthermore, Lido has already been integrated with several road accesses, such as: 1) Bocimi toll connecting MNC Lido City with Bogor, Sukabumi, and Jakarta; 2) Bogor-Sukabumi double track train development was launched in 2018, with expected completion in FY21F; and 3) Cikembar Airport (Sukabumi). With these benefits and integration, KPIG took the advantage by building and developing Lido Lake Resort Extension, an additional 125 hotel rooms, a ballroom and MICE to accommodate the increasing demand in the area. Furthermore, the Company is in the process of revitalizing and changing the Lido Lake area to accommodate other facilities, including Lido Lake Adventure Park, the largest outbound facility in Southeast Asia and Soekarno Park, a historical place known as President Soekarno’s vacation home where he wrote the book titled “Sarinah”. In addition, KPIG will also construct Transit-Oriented Development (TOD) as a public transportation hub for busses and trains.


MNC Bali Resort: One of the Most Luxurious

MNC Bali Resort is an integrated luxury resort and residences development with a total area of 107 ha located in Tanah Lot, Tabanan, Bali.  MNC Bali Resort will feature 6-star Trump International Resort, Golf Club and Residences, the first in Asia to collaborate with Trump Organization, complete with an 18 holes golf course designed by Phil Mickelson and world-class luxury residences. Management will be carried out by the world-leading luxurious hotel & golf operator to make this resort the largest and most integrated in Bali. The construction of MNC Bali Resort has commenced in all components: Golf course with cut and fill, progression in construction of the residential show unit, and almost completion of marketing gallery. The official launching of Trump International Lido and Bali projects was successfully conducted in August 2019. Trump Residences Bali will have 144 ultra-luxurious residences that offer resort lifestyles for its exclusive residence to enjoy.


Valuation and Recommendation : NOT RATED

Based on the Company data, KPIG FY19 RNAV was IDR482 per share. However the stock price is reflected at a 75% discount to RNAV and trailing PBV as of FY19 was at 0.49x, near –1.75 STD PBV. While MNCS is affiliated with the Company, it does not offer any recommendation related to company prospects. Recommendation: NOT RATED.



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