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P H
Nov 22,2016 13:04:55

INCO TARGETS A CONSERVATIVE GROWTH OF PRODUCTION IN 2017

Vale Indonesia Tbk ($INCO) targets a conservative growth of production and expansion in 2017 as nickel price is yet to fully recover. INCO targets a production of more than 80,000 Mt in 2017, higher than 2016 targets of 80,000 Mt of nickel. In 9M16 the Company has produced 58,000 Mt of nickel or 70% of full year target. INCO’s expansion plan in 2017 is relatively equal to the 2016, shown by USD80 mn – USD90 mn of capex target in 2017 which relatively the same as in 2016. The 2017 capex will be used for coal conversion project, assets optimization, and new heavy equipments.

Comments: We see that such production target in 2017 is in line with our projection, but we may revise downward our capex target in 2017 as the Company’s capex target is below our expectation. Currently, our recommendation is HOLD for INCO with TP of Rp2,410.

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P H
Sep 29,2016 20:50:39

Vale Indonesia ($INCO): Beneficiary of Philippine mine closures
Metal mining: Indonesia

§ Closures of Philippine mines likely to raise nickel price to USD10.6k/ton in 2017F: The Philippine government has ordered the suspension of 20 more mines for environmental violations on top of the 10 mines which had failed the environmental audit conducted last month, resulting in a total of 30 mines being closed. Of these, 18 are nickel producers, representing around 56% of the Philippines’ total nickel ore output based on 2015 figures. The mine closures will likely lead to a faster decrease in the global inventory of nickel ore (exhibit 9), which has declined from 442k tons in January 2016 to 362k tons currently, -18% ytd. Hence, we expect this to provide support for global nickel prices to continue rising to USD10.6k/ton in 2017F, +1.6% y-y, and for INCO’s nickel ASP to increase to USD8.3k/ton (exhibit 8), +1.6% y-y.

§ Cost efficiency initiatives should reduce cost per ton by 4.4% y-y in 2017: INCO’s cost efficiency initiatives on utilizing hydro power electricity to power its furnace has helped the company become a low-cost producer. Lower fuel costs (exhibit 6), which account for 21% of total costs, should also help the company reduce its COGS to USD6,825/ton (exhibit 7), -4.4% y-y, in 2017F. This low-cost strategy has enabled the company to sustain its margins despite falling prices in recent years, allowing for higher margins as we expect nickel prices to improve from USD7.7k/ton in February 2016 to USD10.6k/ton in 2017F. Additionally, INCO is currently in the process of converting the reduction chamber from High Sulphur Furnace Oil (HSFO) to being a coal-powered furnace. The fuel conversion will further lower the cost of production.

§ Production capacity should increase to 90k tons in 2018F: INCO is targeting the production capacity to reach 90k tons in 2018F, up 20% from the current level of 75k tons. This can be achieved by tweaking its hydro power plant to provide a more stable electric current which will increase the production capacity while lowering the fixed cost per ton.

Outlook: Baudopi site likely to increase 2023F production to 110k tons
The Baudopi site, which is planned to be operational in 2023, would allow INCO to further expand its nickel matte production capacity from 90k tons in 2018F to 110k tons in 2023F. Moreover, the Baudopi site contains higher-quality nickel ore, which would enable INCO to produce nickel matte at a lower cost.

Recommendation: Reiterate BUY with higher TP of IDR3,500
On the back of our expectation for a higher global nickel price of USD10.6k/ton, +1.6% y-y, and lower COGS/ton by 4.4% y-y, we forecast INCO’s 2017 earnings to double y-y. We have also increased our 2016F EPS by 286% (exhibit 12) as the nickel price has recovered by 24% ytd. On the other hand, we have lowered our 2018F EPS by 47% as we now expect lower production volumes. Overall, we retain our BUY recommendation with a higher 12M TP of IDR3,500 (DCF-based, 5.1% WACC), implying 18% upside potential, and expect its 64% ytd share outperformance (exhibit 4) to be sustainable. Risks: lower nickel prices and lower production volume.

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P H
Apr 14,2016 08:44:04
Tips trading buat hari ini  Kamis, tanggal 14 April 2016  :

1.IHSG kemarin semerbak dengan saham-saham kecil dengan kenaikan yang luar biasa, sedangkan saham baking masih tertekan, kecuali saham ASII.
Tidak usah peduli banget sama market yang susah naik dengan blue chips, kalau banyak saham kecil yang terbang dan memberikan cuan.

2.Jadi mendingan kita bahas satu persatu deh saham-saham yang naik luar biasa.

3.ELSA :Saham ini break out dengan volume yang luar biasa, saham ini jika mampu bertahan diatas level 450, maka targetnya masih jauh yaitu sekitar 630-650.Namun jika tidak mampu bertahan diatas level 450, sebaiknya take profit dulu.

4.GIAA : Saham ini sudah dimainkan 4 hari berturut-turut, so sebaiknya hati-hati, kemarin mencoba menembus level 600, namun tidak kuat sehingga turun kembali dibawah 600, target terdekat adalah 650. Risk lebih besar dari rewards, so main saham ini sebaiknya main cepat saja.

5.ANTM : Saham ini diisukan target menuju 800, kenaikan dalam 2 hari terakhir terlalu cepat, sehingga dapat saja terjadi konsolidasi dahulu, namun jika bertahan diatas level 630, maka saham ini otw menuju 800.

6.TINS : Saham ini sebentar lagi menuju level 1000, so sebaiknya hati-hati jika sudah mencapai level 1000, karena targetnya sudah dekat yaitu 1100.

7.PTBA : Saham ini menguji level 7825, jika mampu tembus level 7825, maka akan menguji level 8000, dengan target 10.000-12.000

8.INCO : Saham ini berpeluang menguji level 2000, dengan target terdekat 2045-2050, target mid term adalah 2700, dengan syarat harus mampu tembus dan bertahan diatas level 2050.

9.ERAA : Saham ini menguji level 800-810, jika tembus maka targetnya akan lumayan jauh, yaitu 1200, dengan syarat harus mampu bertahan diatas level 800.

10.ADRO :Saham ini otw to 800, saham ini ada small resist di level 760. nampak ADRO tidak akan sulit menembus level small resist tsb.

$IHSG $ELSA $GIAA $ANTM $TINS $PTBA $INCO $ERAA $ADRO
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P H
Apr 14,2016 08:42:36
Tips trading buat hari ini  Kamis, tanggal 14 April 2016  :

1.IHSG kemarin semerbak dengan saham-saham kecil dengan kenaikan yang luar biasa, sedangkan saham baking masih tertekan, kecuali saham ASII.
Tidak usah peduli banget sama market yang susah naik dengan blue chips, kalau banyak saham kecil yang terbang dan memberikan cuan.

2.Jadi mendingan kita bahas satu persatu deh saham-saham yang naik luar biasa.

3.ELSA :Saham ini break out dengan volume yang luar biasa, saham ini jika mampu bertahan diatas level 450, maka targetnya masih jauh yaitu sekitar 630-650.Namun jika tidak mampu bertahan diatas level 450, sebaiknya take profit dulu.

4.GIAA : Saham ini sudah dimainkan 4 hari berturut-turut, so sebaiknya hati-hati, kemarin mencoba menembus level 600, namun tidak kuat sehingga turun kembali dibawah 600, target terdekat adalah 650. Risk lebih besar dari rewards, so main saham ini sebaiknya main cepat saja.

5.ANTM : Saham ini diisukan target menuju 800, kenaikan dalam 2 hari terakhir terlalu cepat, sehingga dapat saja terjadi konsolidasi dahulu, namun jika bertahan diatas level 630, maka saham ini otw menuju 800.

6.TINS : Saham ini sebentar lagi menuju level 1000, so sebaiknya hati-hati jika sudah mencapai level 1000, karena targetnya sudah dekat yaitu 1100.
PTBA : Saham ini menguji level 7825, jika mampu tembus level 7825, maka akan menguji level 8000, dengan target 10.000-12.000

7.INCO : Saham ini berpeluang menguji level 2000, dengan target terdekat 2045-2050, target mid term adalah 2700, dengan syarat harus mampu tembus dan bertahan diatas level 2050.

8.ERAA : Saham ini menguji level 800-810, jika tembus maka targetnya akan lumayan jauh, yaitu 1200, dengan syarat harus mampu bertahan diatas level 800.

9.ADRO :Saham ini otw to 800, saham ini ada small resist di level 760. nampak ADRO tidak akan sulit menembus level small resist tsb.

$IHSG $ELSA $GIAA $ANTM $TINS $INCO $ERAA $ADRO
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P H
Apr 11,2016 09:42:44
Mining Sector

Trimegah Securities Mining Conference Takeaways

Mining conference: INCO, DOID, ADRO, HEXA, ELSA
We recently hosted a small Mining Conference on 4th April 2016, inviting 4 prominent mining-related companies (eg; INCO—nickel producer, DOID—mining services contractor, ADRO—coal producer, and HEXA—heavy equipment distributor) and ELSA, a strong player in the O&G related industry. Most of the attendees are from asset management and no representative of pension funds were present, which we think indicates the general positioning among locals: pension funds already own the sector while asset managements are underweight and looking for opportunities.
 


1) Investors are not sure where commodities prices are heading, and so are the corporates
Most of the questions revolve around commodities prices, which seem to be one question that corporates have difficulty on answering. This is not surprising, given recent volatility in commodities prices particularly crude oil. Most corporates seem to be assuming that coal and/or oil prices to hover around current prices in making their investment/operational decisions. The assumptions in our financial models are slightly more conservative. We assume coal price to decline from current level of USD51/ton to USD48.5/ton whereas oil price to USD40/barrel.
 


2) Corporates are focusing on cost efficiency
Given lack of faith in any commodity price forecast, corporates are focusing on cost efficiency instead. A mining consultant who attended our lunch event mentioned that there is plenty of interest on using technology to improve operational efficiency at mining companies these days. This ranges from replacing regular light bulbs with LED to installing GPS on all excavators. This should benefit the larger mining contractors i.e. UNTR and DOID, which have the economies of scale to invest in the higher-end technologies to improve efficiency.
 


3) Expect overall heavy equipment sale to remain sluggish
Coal miners and mining contractors are delaying purchase of new equipment. The impact is less on UNTR as it means higher maintenance activity which is normally a higher margin business, but likely to hurt the smaller heavy equipment sellers more.
 


ADRO remain our top pick in the sector
We have Buys on ADRO and ELSA, with ADRO as our top pick. We like ADRO for its good corporate governance and healthy balance sheet. We also view Batang power plant as a strong catalyst, with projected NAV of IDR104/share (~15% of ADRO’s market cap). Among others, we think INCO has a positive outlook on volume, albeit nickel price remains a risk.

$INCO $DOID $ADRO $HEXA $ELSA $UNTR
Bear
P H
May 11,2015 12:57:17
Indeks Harga Saham Gabungan (IHSG) menguat +0,1% (+3 poin) di level 5184,45 poin pada penutupan perdagangan sesi 1, Senin (11/5). Indeks LQ45 naik +0,15% ke posisi 900. Jakarta Islamic Index (JII) naik +0,27% ke posisi 699 poin. Indeks Kompas 100 naik +0,19% ke level 1.134 poin. IDX30 naik +0,15% ke level 466 poin. Pemodal asing membukukan transaksi net sell (jual bersih) -Rp37 miliar. Transaksi yang tercapai Rp2,136 triliun dengan volume trading sebanyak 5,755 miliar saham. Sektor: Agri +2,07% Mining +1,70% Properti -0,69% Infrastruktur +0,16% Finance +0,04% Trade -0,14% Manufaktur -0,17% Consumer -1,17% Basic ind -0,07% Misc-ind -0,25% Kini sektor agro dan mining menjadi penopang utama laju IHSG pada perdagangan sesi siang awal pekan ini. Saham agri ditunjang oleh naiknya AALI +3,07%. BWPT ++3,75%. DSNG +1,41%. GZCO +1,12%. SIMP +2,34%. SSMS +1,01%. Adapun saham-saham mining yang bergerak naik antara lain: ADRO +5,23%. ANTM +0,63%. ARTI +4,44%. HRUM +2,97%. INCO +1,24%. ITMG +5,51%. Kelompok saham properti bergerak negatif seiring terbitnya Revisi PMK No 90 /PMK.03/2015 tentang pengenaan pajak barang super mewah (PPh 22) untuk properti. Saham-saham properti yang melorot adalah: APLN -1,73%. BSDE -0,28%. CTRA -2,92%. JRPT -7,34%. LPCK -0,90% . LPKR -1,19%. Adapun sektor yang turun paling dalam adalah consumer -1,17%. Koreksi consumer dimotori saham: DVLA -1,11%. KAEF -0,84%. GGRM -0,16%. TSPC -1,67%. ULTJ -2,35%. UNVR -0,06%. Bursa Asia Sentimen kebijan Tiongkok yang memangkas suku bunga menjadi sentimen utama bagi market regional. Bank Sentral Tiongkok (People`s Bank of China (PBOC) menurunkan suku bunga kredit dan deposito bertenor 1 tahun sebesar 25 bps. Indeks Nikkei naik +1,27% (+245,32 poin) ke posisi 19.624,51 poin. Indeks Hang Seng naik +0,50% (+132,29 poin) ke level 27.714,63 poin Indeks Shanghai naik +1,18% (+49,62 poin) ke posisi 4.255,54 poin Indeks Straits Times +0,46% (+15,72 poin) ke level 3.467 poin (pukul 12.00 WIB).
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Quotes delayed, except where indicated otherwise.
INCO
3,020.00 80.00 (2.72%)
Vale Indonesia Tbk.
Last Update 02:54:11