汇丰银行-tempo scan：buy：playing catch-up-20170614-hsbc

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1、14June2017TempoScan(TSPCIJ)EQUITIESPHARMACEUTICALSBuy:Playingcatch-upIndonesiaInspiteofdisappointingtop-linegrowth,TSPCcouldstillcatchMAINTAINBUYup;marginsshouldbesustainableTARGETPRICE(IDR)PREVIOUSTARGET(IDR)TSPCwillintroducenewESOP2668.002900.00MaintainBuyr

2、ating,trimTPtoIDR2,668fromIDR2,900SHAREPRICE(IDR)UPSIDE/DOWNSIDE2000.00+33.4%Top-linegrowthcanstillcatchup(asof12Jun2017)Inspiteoftheslowstarttotheyear(1Q2017netsalesgrewby6.6%Y-o-Y),wethinkMARKETDATAMarketcap(IDRb)9,000Freefloat22%thatTempoScanhasachancetocatchupfor

3、therestoftheyear.WethinkthatMarketcap(USDm)677BBGTSPCIJimprovingconsumersentimentinIndonesiaislikelytobesupportiveofatop-line3mADTV(USDm)0RICTSPC.JKrecoveryin2017.WeexpecttheConsumerProductdivisiontodrivemostofthisFINANCIALSANDRATIOS(IDR)growth(2017erevenuegrowth+14%

4、).WealsothinkthattheresilientIDRexchangeYearto12/2016a12/2017e12/2018e12/2019erate(againstUSD)issupportiveofsustainedgrossmarginsandspendingappetite.HSBCEPS119.17136.52150.94169.02HSBCEPS(prev)124.69145.10163.16-Change(%)-4.4-5.9-7.5-NewESOPConsensusEPS118.85127.0513

5、5.58-PE(x)16.814.713.311.8OurnumbersdonotaccountforpotentialdilutionfromthenewemployeestockDividendyield(%)2.73.23.63.6ownershipplan(ESOP),whichisestimatedtobearound2.91%(perthecompany’sEV/EBITDA(x)9.08.07.36.6ROE(%)12.112.913.413.9filingswiththeIndonesianstockexchan

6、ge)ifTSPCweretoissue135,000newsharesasapprovedduringtheExtraordinaryGeneralMeetinginearlyJune2017.52-WEEKPRICE(IDR)MembersoftheBoardofDirectors,membersoftheBoardofCommissioners2800.00(excludingIndependentCommissioners),andexecutivesareeligibleforTSPC’snew2200.00ESOP.

7、WhileESOPsgenerallyalignemployer-employeeinterests,thedevilisinthedetail.Weawaitfurtherinformationbeforecommenting.1600.0006/1612/1606/17Targetprice:2668.00High:2320.00Low:1735.00Current:2000.00MaintainBuyrating,trimTPtoIDR2,668(fromIDR2,900)Source:ThomsonReutersIBES

8、,HSBCestimatesWevalueTempoScanusingadiscountedcashflow(DCF)model.OurkeyDCFassumptionsareasfollows:FCFCAGR2017-26eof10.3%(previously