ID - [IPCM IJ]: Site Visit: Bigger Vessels, New STS Contracts
Andrey Wijaya - RHB Sekuritas
♦ Maintain BUY on Jasa Armada Indonesia (JAI) with DCF-derived IDR620 TP, 57% upside, implying 14.7-12.9x FY19F-20F P/E.
♦ Our recent visit to JAI’s operations at Tanjung Priok port indicates high activity for pilotage and towage services.
♦ JAI plans to add four new high-powered tug boats for large vessel towage services – which offer better profit.
♦ It recently signed new STS contracts from coal miners for its Musi River operations and received new STS contracts from PetroChina.
♦ It is also likely to start STS operations, with ExxonMobil in early 2019.
♦ JAI has benefitted from the stronger USD, as ~70% of revenue is USD-denominated.
Link to report: https://research.rhbtradesmart.com/attachments/89/rhb-report-ind_jasa-armada-indonesia_site-visit_20181012_rhb-773762612270554575bbfc8f39e8e3.pdf
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