Asian Insight Provider - Actionable ideas, CrossASEAN Research

Henry Soediarko

A Long & Short Investment Ideas generator for Asian Equities with 10 years experience in a Hedge fund focused on bottom-up ideas, searching out mispriced ideas and misunderstood investment thesis. Provides on-the-ground insights in various Asian markets with a sway towards ASEAN. Experienced and survived the Asian Financial Crisis in a family business, as well as the Global Financial Crisis in financial markets where lessons learned. It's all about understanding business drivers and navigating business cycles, which has high applicability in generating investment ideas. 

Investment horizon: Mid to Long term

Asian Insight Provider - Actionable ideas

Sampoerna (HMSP): Post Excise Tax Rebound - Short Term

HMSP (HMSP IJ): A Third of People in Populous Indonesia Smoke

HM Sampoerna (HMSP IJ): The King's Struggle

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

The unsatisfactory 1H 2020 operating numbers that stemmed from lower revenue growth and higher excise taxes reduce operating cash flow, prompting the company to increase the amount of debt in the balance sheet that will further reduce the net income margin by 1.7 to 4% if the next six months' operating numbers will not improve. With the shift in the consumers' taste that reduces Dji-Sam-Soe's (HMSP's flagship product) sales, HMSP is not in the best position to outperform the potential weak consumption trend in the second half of 2020. If HMSP were to cut or forego dividends next year, it will accelerate the switch from HMSP to GGRM. 
HMSP's operating numbers are also very volatile compared to the steady GGRM's, yet the former seems to trade at a higher valuation in the Indonesian equity market compared to the latter albeit losing market share. Maintain underweight HMSP and overweight GGRM.

The unsatisfactory 1H 2020 operating numbers that stemmed from lower revenue growth and higher excise taxes reduce operating cash flow, prompting the company to increase the amount of debt in the balance sheet that will further reduce the net income margin by 1.7 to 4% if the next six months' operating numbers will not improve. With the shift in the consumers' taste that reduces Dji-Sam-Soe's (HMSP's flagship product) sales, HMSP is not in the best position to outperform the potential weak consumption trend in the second half of 2020. If HMSP were to cut or forego dividends next year, it will accelerate the switch from HMSP to GGRM. 
HMSP's operating numbers are also very volatile compared to the steady GGRM's, yet the former seems to trade at a higher valuation in the Indonesian equity market compared to the latter albeit losing market share. Maintain underweight HMSP and overweight GGRM. 

Bentoel Internasional Investama (RMBA IJ)

Sampoerna (HMSP): Losing From Higher Excise Tax