ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

In Equity Sales and Research for more than 25 years covering Asian markets. Possesses in-depth knowledge of a wide range of companies, economies, and markets in Asia. Over his career, he has specialised in HK/China and ASEAN markets at various different Investment Banks, most recently heading equities in Indonesia for Bank of America Merrill Lynch in Jakarta for more than three years. Whilst in Jakarta, he produced a well-read daily and weekly product on the Indonesian market, which included company visits, as well as political, economic and sector commentary. A former racing skier, who enjoys ultra-marathons and surfing in his spare time.

ASEAN Insight Provider

Matahari Department Store (LPPF IJ) - Turning Corners

CrossASEAN Indonesia Strategy - The Stars Are Aligned

Ciputra Development (CTRA IJ) - Primed for the Recovery

Matahari Department Store (LPPF IJ) - Opportunity Knocks?

Matahari Department Store (LPPF IJ) - Too Early to Be Early

Matahari Department Store (LPPF IJ) - Slow Transition to Newness

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Equity Bottom-Up

Matahari Department Store / Equity Bottom-Up

<a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> booked a -23.6% Yoy decline in sales in 1Q2021, as SSSG declined by -36.4% YoY in 1Q2021 but an even greater -37.4% versus 1Q2019, which management is increasingly using as a benchmark. 
The company saw its gross profit declined by -24.2% YoY in 1Q2021 and -41.0% versus 1Q2019 but there was some respite from the higher average basket size. 
<a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a>  suffered a net loss of (IDR95.4bn) during the 1Q2021 versus a profit of IDR143bn in 1Q2019. 
In terms of geography,  Greater Jakarta saw the continuing impact from PSBB restriction and Sumatra was the best performing area. Segment-wise, children's clothing was the least impacted, whilst women's clothing and cosmetics saw the worst impact during 1Q2021.
The company operated a total of 147 stores in 1Q2021, with 23 of those on its watchlist for potential closure and 13 of those due to close after Lebaran.
<a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> is well prepared for the Lebaran festive period, which will likely be shorter than normal.  It has got its merchandise in early ahead of Lebaran given that mobility restrictions have been tightened over the holiday period.
The company continues to build on its Matahari Rewards program with 6.6m active members as of the end of March 2021.
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<a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> continues to see increasing sales through digital channels but it is still working on its platform upgrade so the contribution remains relatively small.
The outlook is relatively uncertain for <a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> with a shorter and more restrictive Lebaran period ahead, which is normally the peak season for the company's customer base to shop
<a href="https://www.smartkarma.com/entities/pt-matahari-department-store" target="_blank" data-smartkarma-citation="entities:5230:1" rel="noopener">Matahari Department Store (LPPF IJ)</a> looks cheap versus its peers but there remain risks to earnings over the Lebaran, which management openly admits are difficult to predict. Longer-term the recovery is likely to be protracted given further store closures and a lack of major sales through digital channels.
Valuations look relatively attractive versus history with the company trading on 13.1x FY21E PER and 7.2x FY22E PER versus its 5-year average forward PER of 12x but we would buy on weakness given some potentially choppy waters ahead.
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Matahari Department Store (LPPF IJ) booked a -23.6% Yoy decline in sales in 1Q2021, as SSSG declined by -36.4% YoY in 1Q2021 but an even greater -37.4% versus 1Q2019, which management is increasingly using as a benchmark. 
The company saw its gross profit declined by -24.2% YoY in 1Q2021 and -41.0% versus 1Q2019 but there was some respite from the higher average basket size. 
Matahari Department Store (LPPF IJ)  suffered a net loss of (IDR95.4bn) during the 1Q2021 versus a profit of IDR143bn in 1Q2019. 
In terms of geography,  Greater Jakarta saw the continuing impact from PSBB restriction and Sumatra was the best performing area. Segment-wise, children's clothing was the least impacted, whilst women's clothing and cosmetics saw the worst impact during 1Q2021.
The company operated a total of 147 stores in 1Q2021, with 23 of those on its watchlist for potential closure and 13 of those due to close after Lebaran.
Matahari Department Store (LPPF IJ) is well prepared for the Lebaran festive period, which will likely be shorter than normal.  It has got its merchandise in early ahead of Lebaran given that mobility restrictions have been tightened over the holiday period.
The company continues to build on its Matahari Rewards program with 6.6m active members as of the end of March 2021.

Matahari Department Store (LPPF IJ) continues to see increasing sales through digital channels but it is still working on its platform upgrade so the contribution remains relatively small.
The outlook is relatively uncertain for Matahari Department Store (LPPF IJ) with a shorter and more restrictive Lebaran period ahead, which is normally the peak season for the company's customer base to shop
Matahari Department Store (LPPF IJ) looks cheap versus its peers but there remain risks to earnings over the Lebaran, which management openly admits are difficult to predict. Longer-term the recovery is likely to be protracted given further store closures and a lack of major sales through digital channels.
Valuations look relatively attractive versus history with the company trading on 13.1x FY21E PER and 7.2x FY22E PER versus its 5-year average forward PER of 12x but we would buy on weakness given some potentially choppy waters ahead.





Matahari Department Store (LPPF IJ) - Uncertain Waters Ahead of Lebaran