|Please click here for report: Aneka Gas Industri: Softer q-o-q performance due to shorter working days|
|Aneka Gas Industri (AGII IJ): BUY
Market Cap: US$125m | Average Daily Value: US$0.01m
Last Traded Price: Rp590; Price Target: Rp1,300 (Upside 120.3%)
William Simadiputra +62 2130034939 william..simadiputra
Softer q-o-q performance due to shorter working days
Revenue affected by shorter working days. Revenue came in at Rp461bn (+5.8% y-o-y, -5.9% q-o-q). The lower q-o-q revenue growth performance can be attributed to the shorter working days in June 2018. We have yet to obtain operational details in 2Q18 but weaker demand from consumer- and healthcare- related end-users appeared to be the culprit behind the lower volume growth in the period.
We are looking beyond AGII’s short-term earnings performance. To gauge AGII’s business performance outlook, we believe that investors need to look beyond its quarterly earnings performance that does not fully reflect its strong footprint in the industrial gas sector and sound operational performance. Moreover, given that it is now at the growth and expansion stage, its earnings performance may be dampened by short-term financing expenses amid AGII’s deleveraging efforts.