Astra International (ASII, Maintain BUY, TP IDR 8,100) – Seasonally lower car sales in Jan22

(Ignatius T. Prayoga – BRI DS)

– Gaikindo reported domestic car sales of 87,783 units in Jan22 (-9.2%mom, 65.9%yoy).

– The market share of ASII decreased to 50.7% in Jan22 compared to 53.1% in previous month mainly due to decrease of Toyota car sales (-30.0%mom), but still supported by Daihatsu car sales improvement (+16.0%mom). We still expect the market share of ASII would reach 52% in FY22.

– As the recent Luxury Tax Discount regulation has been published by ministry of finance, auto sector is still awaiting a decree from ministry of industry to adjust the pricing of the cars. We think the gradual changes on PPNBM DTP will dampen ASP shock in auto market. 

– For 1Q21, however, we anticipate lower monthly wholesale sales volume due to rising case of Omicron. During the Delta variant pandemic (May-Jul21), wholesale volume dropped to level of 54-72K whereas the FY21 monthly sales average is at 74K. We still believe economic recovery and improving commodities prices will support the domestic car sales. We conservatively expect domestic car sales to reach 900K units (+8.0%yoy).

–  We maintain our BUY call with a TP of 8,100. Currently the stock is traded at undemanding valuation at 10.2xPE (below -1std).


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