Review of PT Intanwijaya International Tbk (IDX: INCI) Performance in 2023-Q2

(IDX:INCI)

PT Intanwijaya Internasional Tbk (IDX:INCI)

Fundamental Stock Analysis of INCI Based on the 2023-Q2 Financial Report

Previously, I created a performance review for INCI 2023-Q1. This time, I will review the performance of 2023-Q2. 

Income Statement

Sales:

1. Sales amounted to 176.4 billion compared to the previous year's 272.2 billion.

2. Gross profit was 28.3 billion compared to the previous year's 48.2 billion.

3. Operating profit was 2.7 billion compared to the previous year's 20.1 billion.

4. Year-to-date net profit was 2.3 billion compared to the previous year's 15.8 billion.

5. The net profit margin (NPM) is only 1.31%, a significant decrease from the previous period which was at 5.81%.

The Cost of Goods Sold (COGS) followed the decrease in sales. The total COGS amounted to only 148 billion compared to the previous period, which was at 224.7 billion. Purchases from PT Humpuss were 38.3 billion (equivalent to 36.3%) and from PT Goatama Sinar Batuah were 23.9 billion (equivalent to 22.71%). Regarding the purchase of raw materials, I still feel that it is not ideal because the company can be highly dependent on these two companies. If there is an increase in prices, it will significantly impact the COGS.

Other income and other operating expenses appear to have experienced significant fluctuations. In the previous period, the company recorded other operating income of 2 billion, while in the current period, it's only 5 million. As for other operating expenses, in the previous period, it was only 523 thousand, but in the current period, it reached 2.8 billion. Upon investigation, it turns out that the company holds financial assets in the form of Cash and Cash Equivalents and Restricted Funds totaling 59.7 billion Indonesian Rupiah in the form of US Dollars. The company's management policy regarding assets and monetary liabilities in foreign currency is to hold funds in foreign currency to manage exposure to market risks. The assets in foreign currency are significantly larger than the liabilities in foreign currency, so there is no significant financial liability risk involved.

In terms of sales, there has been a significant decrease. Could this be due to the selection of healthier customers? Sales in terms of unit production have decreased from 35.3 tons to 26 tons.

Balance Sheet

The Company's assets decreased from 496 billion to 470.4 billion. This was due to a decrease in inventory from 71.2 billion to 40.7 billion.

Liabilities were reduced to 50 billion compared to the previous period when they reached 79 billion. This significant decrease is attributed to a reduction in accounts payable to third parties, income tax, other taxes, and lease liabilities.

Even though the company achieved only single-digit profitability, at least for me, there was an increase in equity from 416.9 billion to 418.3 billion.

Cash Flow Statement

Customer receipts reached 175.2 billion. This is reflected because sales were only 176.4 billion. Therefore, the net cash flow obtained from operating activities is a surplus of 1.7 billion.

Valuation

1. Market capitalization 109 billion

2. Cash and cash equivalents 92.1 billion

3. Accounts receivable 110 billion

4. Inventory 40.7 billion

5. PBV 0.26x

6. PER 23.59x

7. Stock price 525

8. Graham Number 710

Conclusion: According to the author, INCI is attractive for collection.

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