A Luxury Discount
Key Takeaways :
▪️ MAPI's 1Q24 faced challenges from its FnB segment (MAPB), which recorded another quarter of EBIT loss at IDR26.4 bn. However, it is important to note that the FnB segment has historically contributed only 12-14% to MAPI’s total turnover and approximately ~6% to EBIT over the past 3Y.
▪️ We anticipate the Active segment (MAPA) to assume a more substantial role in supporting profitability moving forward. Post-covid-19, the Active segment’s revenue to MAPI’s total turnover has seen a significant increase, rising from 29.6% in 1Q21 to 42.0% in 1Q24 (3Y CAGR of ~43%).
▪️ MAPI is also focusing on expanding its potential captive market overseas. This could bolster future revenue streams. In FY23, Active segments in overseas stores (Philippines, Thailand, Malaysia, and Cambodia) achieved a positive EBIT margin (at single-digit).
▪️ We believe the share price has bottomed out, offering a luxury discount for its fair value. We maintain our BUY call on MAPI with a lower TP of IDR2,060/share (potential upside ~37%). we anticipate that rapid expansion in overseas markets through the Active segment will bolster sales and buffer profitability.
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