MNCS COMPANY UPDATE · PT Global Mediacom Tbk (BMTR) operating the largest and most integrated media empire in Southeast Asia, with a portfolio consisting of national Free-to-Air

MNCS COMPANY UPDATE MNC Sekuritas Research Division | July 3rd, 2019

The Most Integrated Holding Investment Company in Indonesia PT MNC Investama Tbk (BHIT) is the most integrated holding investment Company in Indonesia, with a stable and healthy balance sheet, supported by a total of IDR56.89 trillion in assets (as of 1Q19). BHIT runs four (4) main businesses, namely: 1) Media sector, through PT Global Mediacom Tbk (BMTR) operating the largest and most integrated media empire in Southeast Asia, with a portfolio consisting of national Free-to-Air (FTA) TV stations, content producer, subscription TV and online/ streaming businesses; 2) Financial Services sector, through PT MNC Kapital Indonesia Tbk (BCAP) providing one-stop-solution financial facilities including banking, consumer financing, leasing, securities, investment management, life and general insurance, 3) Lifestyle Property, Hospitality & Entertainment sector, through PT MNC Land Tbk (KPIG) which has grown to become one of the largest lifestyle property, hospitality & entertainment groups in Indonesia; and 4) Financial Investments. Competitive Advantage and Business Prospect of BHIT BHIT fully realized the future will be challenging, but at the same time, it will provide more opportunities for MNC Group to become one of the best investment companies in Indonesia. BHIT business through media sector contributed 79.95% to total 1Q19 revenue. Meanwhile, the financial service sector, along with other subsidiaries, contributed 17.72% and 2.33% to total revenue. We believe that going forward BHIT will be able to grow stronger with lower leverage and better performances of all its subsidiaries supported by: 1) Strong macroeconomic of Indonesia followed by a large and young population and growing emphasis to deepen media, internet and financial services penetration; 2) Solid synergy between MNC Group subsidiaries; 3) Right issues plans in 2H19E to further strengthen its capital structure, with targeted amount of IDR1.75 trillion; 4) BMTR through PT Media Nusantara Citra Tbk (MNCN) will launch FTA+, a mobile apps that consists of live streaming for the FTA televisions with various features in 3Q19E; 5) BCAP optimize MNC Group’s networks through access of SPIN, which features e-wallet, e-money, digital payment, fintech, and P2P lending; 6) Lifestyle Property, Hospitality & Entertainment, through KPIG is starting to unlock its value by developing major projects in Lido, Park Tower/ Park Hyatt Hotel Jakarta, Oakwood Hotel and One East Residence in Surabaya and Trump Bali Resort as a new tourism destination. Valuation: Attractive, with only 0.17x of PBV Based on Company data, 1Q19 BV of BHIT is IDR481.06 per share. The stock is trading at 0.17x of trailing PBV FY19. Along with an integrated business model applied in all businesses, focus on digital infrastructure & product and newly operated lifestyle property, hospitality & entertainment projects, the Company is confident it can deliver with solid catalysts ahead. MNCS is affiliated with the company. However, MNCS doesn’t give any recommendation related to company prospect. Recommendation: NOT RATED.

Strengthening with Digital Landscape

PT MNC Investama Tbk (BHIT) Trade, Services and Investment Sector

Source: Bloomberg, BHIT

NOT RATED

Stock Data

Major Shareholders

Curent Price :

52wk Range H-L :

Share Outstanding :

Free Float (%) :

Mkt Capitalization (IDR bn)

:

IDR 81

IDR55 - 115

51,939.1 mn

48.17

4,207

HT Investment & Development LTD

: 25.84%

UOB Kay Hian Hong Kong LTD

: 17.31%

PT Bhakti Panjiwira

: 10.27%

Charlton GRP HLD LTD

: 7.77%

Hary Tanoesoedibjo

: 4.23%

Public : 34.58%

Research [email protected] (021) 2980 3111

Please see important disclaimer at the back of this report

Page 1 www.mncsekuritas.id MNC Sekuritas 1-500-899 [email protected]

Key Financial Highlight (IDR Bn) 2015 2016 2017 2018 1Q19

Revenue 12,878.19 12,894.52 13,580.26 14,725.85 3,636.56

Operating Profit 2,039.04 2,144.91 2,241.12 3,763.43 855.95

Operating Profit Margin (%) 15.83% 16.63% 16.50% 25.56% 23.54%

Net Profit (570.32) 847.93 524.70 945.19 441.22

Net Profit Margin (%) -4.43% 6.58% 3.86% 6.42% 12.13%

ROA (%) -1.07% 1.53% 0.93% 1.68% 0.78% ROE (%) -2.50% 3.51% 2.18% 3.86% 1.77%

Company Profile The Most Integrated Holding Investment Company in Indonesia

MNCS Company Update | MNC Sekuritas Research Division

Exhibit 01. PT MNC Investama Tbk (BHIT) Company Structure

Source : BHIT



PT MNC Investama Tbk (BHIT) is an investment company operating in Indonesia, established in 1989 under the name of ‘PT Bhakti Investama’; in 1997 it listed its shares on the Indonesia Stock Exchange. BHIT runs four (4) main businesses in: 1) Media; 2) Financial Services; 3) Lifestyle Property, Hospitality & Entertainment and 4) Financial Investments. The media sector is operated through BMTR, better-known as “MNC Media”. The Company has the largest and most integrated media enterprise in Southeast Asia, with a portfolio consisting of national Free-to-Air (FTA) TV stations, Content Producer, Subscription TV and online businesses. In the financial services sector, it works through BCAP (otherwise known as MNC Financial Services), a firm committed to providing a complete array of financial products and services, with a main focus on the consumer sector. BCAP strives to capture the great opportunities based on the large population in Indonesia, an appealing demographic (average age under 30) and a growing middle-class income-based economy. In the Lifestyle Property, Hospitality & Entertainment sector, the Company operates KPIG, which has grown to become one of the largest Lifestyle Property, Hospitality & Entertainment groups in Indonesia, a feat achieved in a relatively short period of time. Another business operated by the Company is financial investment. To stimulate business growth and confront opportunities in an era of digitalization, BHIT has fortified its foundation with solid synergy in MNC Group, and continues to innovate with digital-based products and services.

Business Model and Strategy 1) Major Integrated Holding Media Company in Southeast Asia - BMTR


Exhibit 02. Controlling and Ultimate Shareholders (As of June 30, 2019)

Source : BHIT



As one of Indonesia's leading integrated media companies, BMTR holds the country’s most extensive media portfolio. BMTR offers FTA television, multimedia content, as well as online portals, newspapers, magazines, radio, PayTV, broadband Internet services, and other online platforms. Content and advertising-based media, which is managed by MNCN, currently generates 63% of BMTR revenues. On the other hand, BMTR subscription-based media, including PT MNC Vision Networks Tbk (IPTV) adds in 29% to revenues. The prime business line is MNCN, which manages four (4) national FTA TV stations: RCTI, MNCTV, GTV and iNews. MNCN also has a portfolio of MNC-branded Pay-TV channels. Meanwhile, subscription-based media, namely, MNC Vision, MNC Play and MNC Now, are established leaders in Indonesia’s Pay-TV sector. PT Infokom Elektrindo (Infokom) manages BMTR’s media support and infrastructure business. MNC Group is the current leader in Indonesia’s television industry, both in terms of audience share as well as revenue. MNC’s largest content production currently produces 23,000 hours of content per year, and owns the largest content library, with over 300,000 hours of content. Furthermore, 90%+ of all content is sourced from the library and original content produced in-house.

The content business is complemented by 17 local pay-TV Channels. MNC also owns radio, print media, talent management and TV production companies to buttress its core business focus. The second business line is PT MNC Vision Networks Tbk (IPTV), a pioneer in the subscription television industry which provides DTH-based Pay TV with market penetration reaching more than 96%, high speed FTTH broadband and interactive IPTV services. Currently, PT MNC Vision Networks Tbk is the 3rd largest broadband and IPTV operator in four years since inception. PT MNC OTT Network (MNC Now), one of IPTV subsidiaries engaged in digital content broadcast services which provide video on demand (“VOD”) services over the internet and access to MNC Vision, MNC Play and MNC content and features. By continuing to provide innovations to its customers, MNC Vision adds leading-edge PVR (Personal Video Record) services, VOD (Video On Demand), multi-decoder, HD (high definition) channels and OTT/MNC Now. BMTR also holds growing businesses in Online Media. These include the leading online news and entertainment portal: Okezone.com and Sindonews.com; The F Thing, a fashion e-commerce company; Metube.id, a video sharing website; Mister Aladin, an online travel company, and MNC Shop, a 24/7 TV Home Shopping service on MNC Vision and MNC Now. These developing businesses have a combined yield amounting to 8% of BMTR revenues.


Exhibit 03. Company Structure of PT Global Mediacom Tbk (BMTR)

Source : BHIT



Exhibit 04. MNC Media has become the Largest Fully-Integrated Media Company in Southeast Asia

Source : BHIT

Global Mediacom Tbk

Media Nusantara Citra Tbk

Content and Advertising Based Media

PT MNC Vision NetworkSubscription Based Media & Broadband

Online Businesses

IPTV/Fixed Broadband OTTDTH Pay TV

What’s next?




BMTR pursues four (4) key strategies in maximizing its media business potential over the long run, through: 1) Exploiting the MNC Media content library, by launching FTA+; 2) PT MNC Vision Networks Tbk (IPTV)'s IPO with estimated total market capitalization of IDR8,450 billion; 3) Non-Preemptive Rights Issue of MNCN, raising estimated total of capital of IDR1,827-2,284 billion; 4) Monetizing Youtube channel as source of revenue. A) Launch FTA+: Through MNCN, BMTR launched live streaming of 4 FTA as the breakthrough OTT product in 2H19. FTA+ will serve as an extension of BMTR’s four FTA TV stations, combining BMTR’s advertising video on demand (AVOD) and subscription video on demand (SVOD) services. Viewers will be allowed to access special content from MNCN’s extensive library, along with new, never-aired content such bloopers and behind the scenes. Viewers also get more creative content such as quiz, reward system, original short & mid form content and audition. The launching of FTA+ was driven by growing demand from OTT platforms and pay-TV operators, which promise substantial revenue growth. OTT platforms have apparently become millenials' preferred entertainment medium, as they provide personalised contents based on a viewers inclination’; what’s more, content can be streamed through gadgets anywhere and everywhere, as numbers of viewers around the world steadily increase, as well as those in Indonesia, which is still in an early stage of OTT platform user-based expansion. MNCN can thus take advantage of this trend by selling its library content to OTT platforms. B) PT MNC Vision Networks Tbk (IPTV) Goes IPO: IPTV conducts business in fields of trade, development (construction), industry, transportation, information and telecommunications; these professional, scientific and technical activities are incorporated within MNC Group. IPTV is the market leader in the subscription TV business with 96.0% of DTH market share in Indonesia and the 3rd largest broadband and IPTV operator. One of IPTV’s advantages is its synergy with MNC Group, as the largest media entity in Southeast Asia. Starting from PT MNC Sky Vision Tbk (MSKY) in 1988, branding with "Indovision", IPTV successfully expanded its network, with the ownership of a 2.4 million customer base for direct to home (DTH) and IPTV/ broadband in FY18, supported by 101 branch offices and more than 2,000 sales personnel throughout Indonesia. IPTV will released 3,522 billion new shares, equivalent to 10% of the issued and fully-paid capital of the IPTV, following the IPO. The IPO price is set at IDR240 per share, with a target of obtaining around IDR845.28 billion in proceeds. Each share is eligible for 1 sheet of warrant, allowing the purchase of 1 new IPTV share at an exercise price of IDR288 per share. The initial listing is targeted for 8 July 2019. C) MNCN Private Placement: Minority/independent shareholders of MNCN have agreed on MNCS’s plan to issue 1,142 billion new shares, or 8% of MNCN’s paid-up capital per 1Q19, through a Capital Increase Without Pre-emptive Rights (CIWPR). Strike price of CIWPR is to be exercised between IDR1,600 to IDR2,000 per share or any other price greater than this range, with an execution period valid within two years from the date of the EGMS. Estimated proceeds will be around IDR1,827-2,284 billion. All shares subscribed by the public will not be related to controlling shareholders.




D) Monetizing Youtube Channel: Through MNCN, BMTR has become the leader in Youtube subscribers with 37,60 million of subscribers as well as the highest Youtube views amongst the other competitors with 13,70 billion views per April 2019. MNCN is monetizing it's Youtube channel by producing short clips and original content for clients. Since May 2019, MNCN can already acts as an agent for other content producers as it's Youtube channel has got a multi channel license. Furthermore MNCN can minimize the costs by airing the same contents through all of its channels.

This private placement is carried out in order to provide added value to MNCN and strengthen its capital structure, as well as reducing debt, so that the debt-to-equity ratio will decline, and MNCN can conduct other business activities. With the sale of these CIWPR shares, the same number of treasury shares will be cancelled, so that the number of outstanding shares will not increase. Based on OJK regulation Number 30/POJK.04/2017, the requirement to resell treasury stocks is a complex task.

MNCN37,602,606

NET16,292,452

SCMA11,241,685

Trans Group14,894,076

VIVA5,605,786

Kompas2,896,671

Metro Group976,052

MNCN NET SCMA Trans Group VIVA Kompas Metro Group

Including twitter, FB, IG, the total subscribers reach over 48 million, the largerst in South East Asia

Exhibit 05. MNC Media vs Competitors Youtube Subscriber

Source : BHIT

MNC Media vs Competitor Views (in Billion)

13.7

NET8.1

TRANS6.0

EMTEK4.3

KOMPAS1.8

VIVA1.4 METRO

0.4




2) One Stop Financial Solution - BCAP

BCAP runs eight main businesses, integrated closely, through: 1) Banking (MNC Bank/ BABP); 2) Consumer Financing (MNC Finance); 3) Leasing (MNC Leasing); 4) Securities Trader (MNC Sekuritas); 5) Investment Management (MNC Asset Management); 6) General Insurance (MNC Insurance); 7) Life Insurance (MNC Life); 8) Financial Technology (MNC Teknologi Nusantara). Through its banking segment, BCAP provides financial products and services including funds, loan facilities, credit cards, treasury and trade finance from BABP. BCAP also provides consumer financing through MNC Finance, especially in used car financing, home mortgage financing and factoring. Moreover, BCAP, through MNC Leasing, has also expanded into financing of productive assets such as heavy equipment, medical equipment, commercial vehicles, machinery, etc. Insurance, an industry with high potential in Indonesia, also becomes a principal BCAP business through MNC Life and MNC Insurance. BCAP also does business in capital market trades, from sell side, handling IPOs, securities trading, and investment banking (MNC Sekuritas) to buy side (MNC Asset Management) for management of investment products.

Exhibit 06. Company Structure of BCAP

Source : BHIT

Company Name Relationship Main Business Establishment Ownership

PT Bank MNC Internasional Tbk Subsidiary Banking 1989 42.73%

PT MNC Finance Subsidiary Consumer Financing 1989 99.99%

PT MNC Guna Usaha Indonesia Subsidiary Leasing 1993 99.99%

PT MNC Sekuritas Subsidiary Securities Trader Intermediary Service 2004 99.99%

PT MNC Asset Management Subsidiary Investment Management Service 1999 99.99%

PT MNC Asuransi Indonesia Subsidiary General Insurance Service 1987 99.98%

PT MNC Life Assurance Subsidiary Life Insurance Service 1988 99.98%

PT MNC Teknologi Nusantara Subsidiary Financial Technology 2018 99.99%

What’s next?




BCAP faithfully continues to synchronize its eight business units, starting from BABP, which plans to enter BUKU 3 category, thus enabling it to act as a selling agent for other BCAP subsidiaries, including bancassurance services. BABP also targets stronger synergies with other BCAP businesses, through a single financial service platform for cross-selling and joint marketing. Meanwhile, MNC Life focuses on synergy with other BHIT businesses, such as with KPIG, by providing personal accident insurance; it also collaborates with MNC Asset Management through bundling life insurance protection funds. MNC Insurance focuses on synergy with other BHIT businesses, such as with KPIG, by providing insurance for projects under development. MNC Life and MNC Insurance also collaborate through agents in marketing products. Moreover, MNC Securities focuses on collaboration with MNC Leasing and MNC Finance, in cross-selling to business and showroom owners. MNC Asset Management focuses on collaboration with BHIT business units, such as MNC Life, including cross-selling and joint marketing. Meanwhile, MNC Leasing focuses on strengthening existing collaboration with strategic partners, both in heavy equipment and medical businesses. All financial business units under BHIT plan to increase synergy with the media business by maximize BHIT media platforms for advertising and marketing, and also optimizing collaboration with other business units.

3) Big Story in the Making - KPIG

KPIG is known as a lifestyle property, hospitality & entertainment company with a wide range of businesses, extending from hotels, resorts, golf courses, office space rentals, apartments, building management and security services. KPIG recorded 90.50% recurring income to total consolidated revenue in 1Q19, from direct operation and through its 7 subsidiaries. These subsidiaries run four main businesses, namely: 1) Hotels, resorts and golf courses; 2) Leased office space; 3) Apartments & other property; 4) Security & other related services. The main business line of KPIG includes hotels, resorts and golf courses, contributing more than 50% of total consolidated revenue over the past three years. KPIG owns a resort and international convention center in Nusa Dua, Bali, operating under Westin Hotels and Resorts brand. Recently, KPIG has renovated a 5-star hotel and resort in Lido, Bogor, West Java. This hotel has been re-open since October 2018 and receives major bookings, especially for corporate retreats and MICE events. KPIG is also developing a new MNC Bali Resort under Trump International Bali Resort over an area of 110 ha. KPIG has approximately eight leased office facilities, strategically located around Jakarta, Bali and Surabaya. Most office leases in Jakarta recorded a high occupancy rate of over 90% in 1Q19, while Gedung BEI Surabaya stood at just 63.54%, as it just began operations in FY17. The business unit for the management of offices is engaged in property rentals, which have become a stable source of recurring revenue and a backbone of KPIG financial structure. The apartment sector is on an upward trajectory, particularly in Jakarta and Surabaya. This phenomenon is expected to be a leading investment instrument in 2019. In this sector, KPIG has completed One East Penthouse & Residences Collection in East Surabaya as premium apartments with 74,801 sqm in area, featuring a 5-star hotel managed by Oakwood as of end-2017. This building is situated in quite a strategic location near the airport, shopping malls, hospitals and universities.


Exhibit 07. Company Structure of KPIG

Source : KPIG



In the security and other services sector, KPIG works through PT Global Jasa Sejahtera (GJS), a subsidiary which provides security personnel and other outsourced manpower to meet the needs of building tenants. In 1Q19, this business segment contributed revenues of 35.03% to KPIG’s operating revenues, an increase of over 78.90% YoY in 1Q19.

What’s next? KPIG continuously engages in the rapid development of lifestyles property, hospitality and entertainment. KPIG has successfully completed and launched its project namely One East Penthouse & Residences Luxury Collection at Surabaya in FY18 (263 units of strata apartments) as well as lifestyle and retail area. Adjacent to this building, KPIG also completed Oakwood Hotel & Residence that will be grand launched in FY19. This 5-star hotel with a total of 144 rooms has been soft-launched for public since 9M18 and benefits from its prominent location in an elite area in East Surabaya as well as the quality of service and the comfort of luxury living it offers. Meanwhile, Park Hyatt Jakarta, the first and the only Park Hyatt in Indonesia, shall start its debut to a soft opening in FY19E. The hotel is occupied on the top 20 floors of Park Tower, situated in a 5-ha integrated mixed-use complex of MNC Center in the Kebon Sirih area. This 6-star hotel with 222 rooms in total, one promising a panoramic city view with featuring five premium restaurants in Jakarta is very suitable for business and luxury leisure. While the office space of the Park Tower provides 19-level premium offices with a comfortable atmosphere has been partially opened for lease since FY18. Furthermore, as part of its pipeline, KPIG is in progress to develop luxury and high-end hotels and resorts in FY19E, including: 1) MNC World Lido, a theme park resort located in West Java which provide a beautiful panorama of Mt. Salak and Mt. Pangrango, a very pleasant average temperature of hilly area and it shall present a new smart city concept for living, working and leisure; 2) Trump International Resort Lido and Golf Club located in Bogor Lido; 3) Trump Luxury Hotel, Bali. All of these projects, though are targeted for medium term growth, shall already boost confidence of KPIG overall promising and continuity growth as well as its short term growth in FY19E.

PT Nusadua Graha

International53.98%

MNC Financial Center

Sindo Building

PT MNC Land Lido

99.99%

MNC Plaza

MNC Tower

High End

The Westin Resort &

Convention Center

Nusa Dua Bali

MNC College

BEI BuildingSurabaya

PT MNC LandBali

99.99%PT GLD Property

99.99%

PT MNC Graha Bali

99.99%

PT MNC Graha Surabaya99.99%

PT MNC Land Surabaya97.95%

One East Penthouse &Residences

Luxury Collection, Oakwood Hotel &

Residence

Indovision Building Bali

Park Tower

Trump Hotel, Golf & Club House, Residences

PT Global Jasa Sejahtera

99.67%

Building Management,

Security,CleaningService,Technical

PT MNC LidoHotel (99.99%)

PT MNC Wahana Wisata

(99.97%)

Theme Park Resort

Lido LakeResort

Trump Hotel, Golf & Country Club,

Residences




INVESTMENT THESIS Macro Drivers Support Industry Growth

We see that domestic demand works as a key driver of economic growth, influenced primarily by household consumption as well as by consumption through non-profit institutions serving households. Strong domestic demand occurs on the back of rising incomes, controlled inflation and growing consumer confidence. On the other hand, non-profit institutions serving household consumption increased from 8.59% YoY to 10.79% YoY over the same period, as spending on preparations for the presidential and legislative elections contested in 2019 was ramped up. We believe that the Government is still focusing on populist steps through distribution and utilization of national budget funds, potentially increasing domestic consumption, specifically mid-to-low segment in FY19E. Therefore, we see greater probabilities for higher disposable income, which should provide a good base for BHIT’s earnings recovery, supported by a large and youthful population, with 226 million people below age of 54, growing by 3 to 4 million people every year over the next 15 years. A rising middle-class group will grow advertising expenditures in line with GDP growth.

Source: KPIG

Exhibit 08. Future KPIG Project

Park Hyatt Hotel, Jakarta

Lakes Lido View

MNC World Lido – Theme Park

MNC Group Synergy: Creating a Solid Business Ecosystem

Under the leadership of the founder and Chairman of MNC Group, Hary Tanoesoedibjo, BHIT is currently focusing on 3 (three) strategic investments, namely, media, financial services, and lifestyle property, hospitality & entertainment, as well as one other complementary business closely related to its core business, namely, financial investment. The Company business model is currently integrated with all MNC Group subsidiaries. In fact, BHIT has full access and support in developing its business.




Source : BHIT

Exhibit 09. ASEAN Population and Real GDP in USD per FY18

Source : BHIT

Exhibit 10. Indonesia - Young Population by Age

27%

17%

43%

8% 6%

0-14 15-24 25-54 55-64 65+

MNC Media Group, under BMTR, offers various distribution channels through 4 (four) national FTA TV stations: RCTI, MNCTV, GTV and iNews, as well as 17 channels broadcasting on subscriber-based television (i.e. MNC Channels) with more than 300,000 hours of programming. In this content and advertising-based media segment, MNC Media is still the television industry leader, providing popular drama and talent programs, along with an audience share of 39.2% as of Jan-19. Subscriber-based media segment, managed by MNC Vision today, has engendered the largest pay-TV channels in Indonesia, with 2.4 million active customers. To strengthen synergy in the media business, MNC Media also owns and operates print media and the largest radio network. Furthermore, in the online business, MNC Media has Okezone.com and Sindonews.com, an online news and entertainment portal focusing on Indonesian readers with various contents. We believe that other businesses units, under financial services, lifestyle property, hospitality & entertainment sector can optimize their businesses through integrated distributional channels offered by BMTR, commanding a huge potential client data base.

1,148,253

323,680 186,326 437,515 383,304319,915

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

0

50

100

150

200

250

300

Indonesia Phillippines Vietnam Thailand Malaysia Singapore

Population (LHS) USD Real GDP (RHS)*In Millions




Source : BCAP

Exhibit 11. MNC Group Synergy Creating a Solid Business Ecosystem

In the financial services sector, managed by BCAP, known as ‘MNC Financial Services’, MNC Group has a strong commitment to providing comprehensive and integrated financial products and services: MNC Bank, MNC Finance, MNC Leasing, MNC Sekuritas, MNC Asset Management, MNC Insurance, MNC Life and MNC Teknologi Nusantara. KPIG also expects to receive financial backing from MNC Financial Services Division. MNC Brand will potentially benefit BCAP, in order to create and increase the value chain in their group cycle. Meanwhile, KPIG has a vast potential client data base, as KPIG focuses on the lifestyle property, hospitality & entertainment business, with residential, office and large-scale hospitality projects under development. KPIG commits to and focuses on developing unique, lavish and playful projects such as: 1) 'MNC Lido City', an integrated new world-class city in Lido Bogor, sited on 3,000 ha; 2) MNC Bali Resort, the largest luxury facility in Bali, on a 110 ha area. Furthermore, the 2 big projects have also been completed, namely: 1) One East Penthouse & Residences Collection, Surabaya; 2) Park Tower, a mixed-use development consisting of Park Hyatt hotel and office tower (grade A) in Central Jakarta. In our view, the success of BHIT in its quest to become the leader of Investment Companies cannot be separated from a linkage of strong branding and synergy between business units. The synergy between MNC Group business units exerts a positive impact on BHIT business continuity.

BHIT

BCAP

KPIGBMTR




Source : MNC Play

Exhibit 12. Synergy between the Media Group (MNC Play) and Property Business (MNC Land)

Source : MNC Sekuritas

Exhibit 13. Synergy between the Media Group (MNC Vision Networks) and Financial Services Group (MNC Sekuritas)

MNC Media Group, through MNCN, will launch FTA+, a digital platform consisting of live streaming for its 4 (four) FTA (RCTI, MNCTV, GTV, iNews) with various additional features, such as catch up TV, a library and other creative content in 3Q19E. FTA+ will offer an extension of 4 FTA TV stations available with free via Apps (IOS & Android). The creative content, which consists of bloopers, behind the scenes, auditions, quizzes and web series, including other short, medium, and long form content, will be mostly exclusive to FTA+ viewers.

New Digital Initiatives in the Media Sector: MNC FTA+ Mobile App Launch




Source : BHIT

Exhibit 14. Digital extension FTA TV (FTA+) available for free via Apps (IOS & Android)

MNCN also consistently delivers strong growth in its advertising revenue from conventional TVC, through its advertising format to creative ads such as built-in, virtual ads, and squeezed frame. Management expects that revenue from creative ads will grow around 50% YoY from close to IDR200 billion in 2018 to IDR300 billion in FY19E. In fact, all the above digital initiatives are expected to enable the Group’s digital revenues to soar this year, as MNCN is targeting 100% growth per annum in digital revenue over the next two years. We believe that FTA+ will be an important source to strengthen the Company’s digital revenue growth. Furthermore, to grow the pay TV and broadband business, the Company plans to carry out an initial public offering for MNC Vision Network (IPTV), targeted for 1H19.

MNCN Also Tracks Refinancing

The next step of BHIT is to be followed by MNCN, conducting a private placement by issuing 1.14 billion new shares, or 8% the total shares, at a price of IDR1,600-IDR2,000/share. This implies that funding is to be around IDR1.83-2.29 trillion. In 1Q19, the DER of MNCN was at a 0.42x level, carrying total debt of IDR4.59 trillion in 1Q19 (vs IDR4.18 trillion in 1Q18), and total equity of IDR10.98 trillion in 1Q19 (vs IDR10.02 trillion in 1Q18).

Source : Bloomberg

Exhibit 15. MNCN’s Debt-to-Equity Ratio Trend in FY15-1Q19

0.39 0.39

0.38

0.42 0.42

0.35

0.36

0.37

0.38

0.39

0.40

0.41

0.42

0.43

-

2,000

4,000

6,000

8,000

10,000

12,000

FY15 FY16 FY17 FY18 1Q19

(x)(IDR bn) Total Debt Total Equity DER




Source : Bloomberg

Exhibit 16. MNCN’s Total Liabilities & Interest Coverage Ratio Trend

Source : Bloomberg, MNCS

Exhibit 17. BCAP’s Bottom Line Accelerating Trend from 4Q17 to 1Q19

BCAP has focused on developing a stronger foundation for operations of all subsidiaries since 2014, from a renovated professional, experienced management team to a strengthened balance sheet. As a result, BCAP has successfully crafted a turnaround story, recording positive net income of IDR10.70 billion in 1Q19, from a state of underperforming profitability over the past three (3) consecutive years.

BCAP Turnaround Story toward Evolving into an Integrated Financial Supermarket, Leveraging on "SPIN"

Moreover BCAP leveraging on MNC Group network through access of SPIN which fea-tures e-wallet, e-money, digital payment, fintech, P2P lending. SPIN aims to become a single digital customer touch point and increase MTN customers' product usage, en-gagement and loyalty. SPIN will also leverage MNC Group's media FTA channels where the customers are enabled to utilize SPIN. It will be redirected to e-commerce partner's landing or check-out page for the payments. It is also equipped by artificial intelligence chat box and analytics platform where it will allow learning based on feedback loop to Big Data. SPIN will be implemented and scheduled to be launched in FY19E.

35.80

6.71

(23.69)

(62.06)

(0.01)(20.20)

(33.91)

8.41

(34.38)

(1.13)(33.33)

(265.82)

30.11 35.62

(12.60)

66.71

10.70

(300)

(250)

(200)

(150)

(100)

(50)

-

50

100

1Q15

2Q15

3Q15

4Q15

1Q16

2Q16

3Q16

4Q16

1Q17

2Q17

3Q17

4Q17

1Q18

2Q18

3Q18

4Q18

1Q19

IDR

bn

Negative trend bottom line of BCAP Moving to Positive Trend

-

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

45.00

50.00

4,200

4,400

4,600

4,800

5,000

5,200

5,400

5,600

5,800

FY15 FY16 FY17 FY18 1Q19

(x)(IDR bn) Total Liabilities Interest Coverage Ratio




Source : BCAP

Exhibit 18. "SPIN" Indonesian Smart Payments

Lido Lake Resort, a KPIG property, has re-launched in 10M18 after completion of a massive renovation over an area of 3.3 hectares, elevating Lido Lake Resort's rating to that of a five-star hotel with 101 rooms. Recently, KPIG also completed and launched another project: Oakwood Hotel & Residence in Surabaya. This 5-star hotel with 144 rooms is a mixed-use building which features One East Penthouse & Residences Luxury Collection (263 units of strata apartments) and also offers lifestyle and retail areas. KPIG will also launch Park Hyatt Jakarta, the first and the only Park Hyatt in Indonesia, which will debut through a soft opening in 4Q19. The hotel will occupy the top 20 floors of Park Tower. Promoted as a six-star hotel, Park Hyatt Jakarta consists of 222 rooms, international restaurants, facilities and function rooms, which guarantees luxurious service for private events, social and corporate gatherings. MNC Lido City is an iconic project located in Lido, West Java. MNC Lido City offers a beautiful panorama of impressive Mt. Salak and Mt. Pangrango, and a very pleasant West Java cool climate; it embodies a new smart city concept for living, working and leisure. As part of its 1st phase development, KPIG is developing Trump International Resort, Golf Club and Residences Lido, which includes 120 suites and villas, an international 18-hole golf championship course, a lifestyle country club, luxury villas, and condominium units. All these luxury developments will be managed by Trump Hotel Collection, and will stand as the first resort in Asia bearing the prestigious Trump brand. As of end-1Q19, KPIG had completed the construction of a main road span of over 3,500 meters in length, serving as the main access thoroughfare within MNC Lido City, connecting with the newly-completed Bocimi toll road to the national road network.

KPIG Moving toward a New Edge

E-wallet

QR code payment

Social mediapayment

Online KYC

Loyaltyplatform

Analyticsplatform

Artificial intelligence chatbox

Virtual accounts (MNC Bank)

Transportation & travel payment(MNC Travel, a travel mediacompany & Mister Aladdin, anonline travel company)

Entertainment & themepark payment (Lidoresort, other resortfacilities)

Bills payment

Savings &investments (MNCAsset Management

mutual funds)

E-commerce payment& escrow

Schools payment(schools & boardingschools) andadditional smart card

Shops payment

Insurance(MNC Life &MNC Insurance)

Funds transfer

P2P microloans




Source : KPIG

Exhibit 19. Development Component of MNC WorldTM Lido

Source : BHIT

Exhibit 20. BHIT’s Debt-to-Equity Ratio Trend in FY15-1Q19

BHIT plans a corporate action through a rights issue as the optimal way to refinance its maturing debt, by issuing 17.57 billion new shares, thus securing about IDR1.75 trillion in new equity proceeds. During 1Q19, total debt stood at IDR16.90 trillion (vs IDR19.24 trillion in 1Q18), while total equity was IDR24.99 trillion in 1Q19 (vs IDR24.19 trillion in 1Q18). Therefore, BHIT carries a Debt-to-Equity Ratio (DER) at 0.18x in 1Q19. Objectives of the refinancing are: 1) Payment of USD115 million to Caravaggio Holding Limited and New Ascend Limited, debt maturing in 7M19; 2) Remaining funds will be directed to BHIT working capital.

Deleveraging to Boost Performance

0.66 0.64

0.78 0.72

0.68

-

0.20

0.40

0.60

0.80

1.00

-

2.00

4.00

6.00

8.00

10.00

12.00

14.00

16.00

18.00

20.00

FY15 FY16 FY17 FY18 1Q19

(x)(IDR tn)Interest Bearing Debt (LHS) Debt to Equity Ratio (RHS)




Source : BHIT

Exhibit 21. BHIT’s Total Liabilities & Interest Coverage Ratio Trend


Exhibit 22. BHIT USD-IDR Exposure Ratio


Exhibit 23. USD/IDR Trend in FY15-FY19

11.500

12.000

12.500

13.000

13.500

14.000

14.500

15.000

15.500

Jul-1

5

Sep-

15

Nop

-15

Jan-

16

Mar

-16

Mei

-16

Jul-1

6

Sep-

16

Nop

-16

Jan-

17

Mar

-17

Mei

-17

Jul-1

7

Sep-

17

Nop

-17

Jan-

18

Mar

-18

Mei

-18

Jul-1

8

Sep-

18

Nop

-18

Jan-

19

Mar

-19

Mei

-19

Jul-1

9USDIDR Average

18.04%

81.96%

USD IDR

17.58%

82.42%

USD IDR

1Q19 1Q18

-

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

29,000

29,500

30,000

30,500

31,000

31,500

32,000

32,500

33,000

FY15 FY16 FY17 FY18 1Q19

(x)(IDR bn)Total Liabilities Interest Coverage Ratio




The BHIT rights issue will dilute ownership of BHIT, with a maximum of 25% of initial capital, with 17.44 billion new shares. However, the scenario will change if the public chooses not exercise its right for BHIT’s rights issue. Caravaggio Holdings Limited and New Ascend Limited will then receive BHIT shares worth USD115 million, at which point the percentage of BHIT ownership by Caravaggio Holdings Limited and New Ascend Limited will rise to 12.21% and 11.01%, respectively.

Source : BHIT

Exhibit 24. Scenario 1: BHIT’s Shareholder Composition Before and After Rights Issue

Capital Structure Pre Right-Issue

No. Of Shares Nominal Value % @IDR100

Authorized Capital 205,000,000,000 20,500,000,000,000

Issued and Paid-Up Capital

HT Investment Development Ltd 13,238,835,716 1,323,883,571,600 25.29

Smart Empire Group Ltd 6,025,697,879 602,569,787,900 11.51

PT Bhakti Panjiwira 5,262,220,112 526,222,011,200 10.05

Charlton Group Holdings Ltd 3,982,085,217 398,208,521,700 7.61

UOB Kay Hian (Hong Kong) Ltd 2,842,553,000 284,255,300,000 5.43

Public (below 5%)* 20,989,312,146 2,098,931,214,600 40.11

Standby buyer:

Caravaggio Holdings Limited - - -

New Ascend Limited - - -

Issued and Paid-Up Capital before Treasury Shares 52,340,704,070 5,234,070,407,000 100

Treasury Shares 376,473,646 37,647,364,600

Total Issued and Paid-Up Capital 52,717,177,716 5,271,717,771,600 Shares in Portfolio 152,282,822,284 15,228,282,228,400

Capital Structure Post Right-Issue

No. Of Shares Nominal Value % @IDR100


Issued and Paid-Up Capital

HT Investment Development Ltd 13,238,835,716 1,323,883,571,600 18.97

Smart Empire Group Ltd 8,034,263,839 803,426,383,900 11.51

PT Bhakti Panjiwira 7,016,293,483 701,629,348,300 10.05

Charlton Group Holdings Ltd 5,309,446,956 530,944,695,600 7.61

UOB Kay Hian (Hong Kong) Ltd 3,790,070,667 379,007,066,700 5.43

Public (below 5%)* 27,985,749,527 2,798,574,952,700 40.11

Standby buyer:

Caravaggio Holdings Limited 2,320,057,993 232,005,799,300 3.32

New Ascend Limited 2,092,887,246 209,288,724,600 3.00


Treasury Shares 376,473,646 37,647,364,600

Total Issued and Paid-Up Capital 70,164,079,073 7,016,407,907,300

Shares in Portfolio 134,835,920,927 13,483,592,092,700

*Added with MESOP that has not been converted amounted to 778,042,132 shares




Source : BHIT

Exhibit 25. Scenario 2: BHIT’s Shareholder Composition Before and After Rights Issue

Source : BHIT

Exhibit 26. Board of Commissioners of BHIT

BHIT is run by a reliable management team with over 28 years of experience in the media, financial, lifestyle property, hospitality & entertainment. Reliable and competent management, able with to deal with all challenges, will serve as the key to success of current developments as well as those projected for the future. Commissioners and Directors currently guiding the Company are as follows:

Competent Management Team with More than 28 years of Experience

Capital Structure Pre Right-Issue No. Of Shares Nominal Value % No. Of Shares Nominal Value % @ IDR100 @ IDR100


205,000,000,000 20,500,000,000,000

Issued and Paid-Up Capital HT Investment Development Ltd 13,238,835,716 1,323,883,571,600 25.29 13,238,835,716 1,323,883,571,600 19.42 Smart Empire Group Ltd 6,025,697,879 602,569,787,900 11.51 6,025,697,879 602,569,787,900 8.84 PT Bhakti Panjiwira 5,262,220,112 526,222,011,200 10.05 5,262,220,112 526,222,011,200 7.72 Charlton Group Holdings Ltd 3,982,085,217 398,208,521,700 7.61 3,982,085,217 398,208,521,700 5.84 UOB Kay Hian (Hong Kong) Ltd 2,842,553,000 284,255,300,000 5.43 2,842,553,000 284,255,300,000 4.17 Public (below 5%)* 20,989,312,146 2,098,931,214,600 40.11 20,989,312,146 2,098,931,214,600 30.79

Standby buyer:

Caravaggio Holdings Limited - - - 8,321,109,800 832,110,980,000 12.21 New Ascend Limited - - - 7,506,340,200 750,634,020,000 11.01


68,168,154,070 6,816,815,407,000 100

Treasury Shares 376,473,646 37,647,364,600 376,473,646 37,647,364,600

Total Issued and Paid-Up Capital 52,717,177,716 5,271,717,771,600

68,544,627,716 6,854,462,771,600

Shares in Portfolio 152,282,822,284 15,228,282,228,400

136,455,372,284 13,645,537,228,400

Performance Post Right-Issue

BOARD OF COMMISSIONER

Hary Tanoesoedibjo

President Commissioner

Liliana Tanoesoedibjo

Hary has over 17 years of experience in media industry. Hestarted his career at PT Global Mediacom in 2002 asPresident Director. Recently, he was appointed PresidentCommissioner of MNC Investama in September 2016.

Liliana has over 10 years of experience in the media indus try,where she held the first Commisioner position at PT StarMedia Nusantara in 2007. Her previous role within MNCGroup as a President Director of MNC Pictures since 2009 –present.

Commissioner

Kardinal AlamsyahKarim

Independent CommissionerKardinal is an expert in the field of Audit, where he held anumber of strategic positons since 1970. He joined theGroup in 2006. He was appointed as Co mmissioner in July2015 His previous role within Group as an IndependentDirector of Global Mediacom since 2006-2015.

Angela Herliani Tanoesoedibjo

CommissionerAngela started her career in MNC Group in 2014 asManaging Director PT Global Informasi Bermutu (GTV).Recently, she was appointed as as Commissioner of MNCInvestama as of September 2016. Her previous role withinMNC Group as a Commissioner of PT MNC Pictures since2017-present.

Ricky Herbert P. Sitohang

Independent CommissionerRicky has strategic positions in Indonesian National Policefor over 25 years. Recently, he was appointed as MNCInvestama Independent Commissioner as of June 2018.

Valencia Herliani Tanoesoedibjo

CommissionerValencia started her career in MNC Group in 2015 asExecutive Assistant to Group CEO Okezone. Recently, shewas appointed as a Commissioner of MNC Inves tama as ofJune 2017. Her previous role within MNC Group as a Directorof PT Star Media Nusantara since 2017-present.

*Added with MESOP that has not been converted amounted to 778,042,132 shares




Source : BHIT

Exhibit 27. Board of Directors of BHIT

Financial Highlights: Superior Performance with Positive Bottom Line

BHIT managed to book a positive net profit of IDR441.22 billion in 1Q19, after booking a negative net profit in 1Q18 of around IDR-811 million. Meanwhile, its revenue in 1Q19 reached IDR3.64 trillion, or up by 10.07% YoY. The media business as the largest composition of revenue was around 79.95%, and could conceivably increase by 12.89% YoY, while the financial institutions displayed flat growth at 1.29% YoY to IDR644.51 billion (17.72% of revenue). Gross profit reached IDR1.63 billion, representing an increase of 2.97% YoY. Therefore, Gross Profit Margin (GPM) marked 44.89% in 1Q19 (vs 47.99% in 1Q18), while net profit margin was better at 12.13% in 1Q19, compared to -0.02% in 1Q18.

Source : BHIT

Exhibit 28. BHIT Revenue Breakdown in 1Q18 and 1Q19 (in billions of IDR)

BOARD OF DIRECTOR

Darma Putra

President Director

Susanty Tjandra Sanusi

Darma joined the Group in 2008 as Director of MNCInvestama and MNC Kapital both since 2008-2014. Since hejoined MNC, Darma has multiple positions as a CommisionerPT MNC Sekuritas (2009), Commisioner PT MNC Finance in2008 and recently held the President Commissioner PT MNCKapital Indonesia in 2016.

Susanty joined the Group in 2013 where she started as thedirector for 1 year. She has over 32 years of experience inBanking. She was appointed as Vice President Director &Independent Director in April 2014.

Vice President Director

Jiohan Sebastian

DirectorJiohan started his career in MNC Group in 1997 as ManagerOrigination & Syndication PT Bhakti Securities. Recently, hewas appointed as Director of MNC Investama as of April2014. His previous role within MNC Group as a Senior VicePresident Treasury & Investment since 2012-2014.

Henry Suparman

DirectorHenry joined the Group in 2005 where he started as theCorporate Finance Manager at PT Bhakti Securities. He heldthe various director positions within MNC Group companiesmostly in media sector. His Previous role within MNC Groupas a President Director of iNews since 2013-2014.

Natalia Purnama

DirectorNatalia has over 22 years of experience in Corporate Financewhere she joined the Group since 1996. Her previous rolewithin MNC Investama as Senior Vice President, Treasuryand Corporate Finance Group CEO Office since 2012-2014

Tien

DirectorTien started her career in MNC Group in 1997 as theCorporate Finance Manager Recently, she was appointed asDirector of as of April 2014. Her previous role within MNCGroup as a Director of MNC Sekuritas (2004-2014) and hasbeen twice as Director of MNC Kapital Indonesia in 2000-2003 and 2014-2016.

Mashudi Hamka

DirectorMashudi is an expert in the field of Information Technologywith 20 years of experience working in Japan and 3 years inHong Kong. He has been a pioneer in the InformationTechnology and Integrated System Business Developmentspace for 16 years. Recently, Mashudi became MNC Kapital’sCommissioner in May 2018

2,575.20 2,907.27

636.31 644.51 92.37 84.78

1Q18 1Q19

Media Financial Institutions Others




Stable and Healthy Balance Sheet

Total assets remained stable, with 0.09% YoY growth to IDR56.89 trillion, linked to lower cash at IDR1.93 trillion, while inventories and other financial assets related to investment grew by 8.88% YoY and 11.35% YoY in 1Q19, respectively. Meanwhile, loan disbursement carried out by Bank MNC International (BABP) grew by 5.27% YoY. BHIT managed to maintain a healthy balance sheet with DER stable at 0.56x in 1Q19, with a current ratio at 1.10x (vs 1.06x in 1Q18).

Source : BHIT

Exhibit 29. BHIT Balance Sheet in 1Q18 and 1Q19 (in IDR billion)

Source : BHIT

Exhibit 30. BHIT Financial Summary in 1Q19 and 1Q18 (in IDR billion)

Balance Sheet 1Q19 1Q18 Growth

Total Asset 56,890.53 56,384.82 0.90%

Total Equity (LHS) 24,985.87 24,190.95 3.29%

Total Liabilities (LHS) 31,904.66 32,193.88 -0.90%

Consolidated Statement of Profit or Loss and Other Comprehensive Income

1Q19 1Q18 Growth

Media 2,907.27 2,575.20 12.89%

Financial Institutions 644.51 636.31 1.29%

Others 84.78 92.37 -8.22%

Revenue 3,636.56 3,303.88 10.07%

Direct Cost (2,004.08) (1,718.42) 16.62%

Gross Profit 1,632.48 1,585.46 2.97%

Operational Expense (776.53) (828.53) -6.28%

Profit Before Tax 582.62 170.61 241.49%

Tax Expense (141.40) (171.42) -17.51%

Net Profit 441.22 (0.81) 54,571.60%

55.87

58.61

40

45

50

55

60

-

10,000

20,000

30,000

40,000

50,000

60,000

1Q18 1Q19

(%)(IDR bn)

Total Equity (LHS) Total Liabilities (LHS) Long-term Debt to Equity (RHS)




Two categories of risk can affect the Company’s financial condition: external and internal factors. External Factors : 1. Weakening of USD/IDR Exchange Rate The weakening of the USD/IDR exchange rate against foreign currencies will exert a negative impact, especially on the Company’s ability to fulfill its USD obligations. As of March 29, 2019, the Rupiah exchange rate against the USD stood at IDR14,244/USD (vs IDR13,756/USD as of March 29, 2018). This displays a foreign exchange loss that affects the financial condition of the Company. 2. Fluctuation in Interest Rates Loans in floating and fixed interest rates mean the Company and subsidiaries are exposed to interest rate risk. This form of risk can bulk up the Company's cost of funds, and this will affect the Company’s operational activities and financial performance. Internal Factors : 1. Thin Liquidity Problem in liquidity can occur in certain work units when estimates of funding requirements for operations are not calculated correctly, resulting in existing funds of the Company failing to meet Company needs. 2. Potential Credit Risk from Subsidiaries Providing a significant amount of credit to a given group of companies or industries will raise potential credit risk from subsidiaries, due to the inability of a debtor to fulfill debt obligations to the Company.

Main Business Risks

Based on Company data, 1Q19 BV of BHIT is IDR481.06 per share. The stock is trading at 0.17x of trailing PBV FY19. Along with an integrated business model applied in all businesses, focus on digital infrastructure & product and newly operated lifestyle property, hospitality & entertainment project, the Company is confident it can deliver with solid catalysts ahead. MNCS is affiliated with the company. However, MNCS doesn’t give any recommendation related to company prospect. Recommendation: NOT RATED.

Valuation: Attractive at only 0.17x of PBV




Exhibit 31. Financial Summary FY15-1Q19

Source: Company, MNCS

Cash Flow Ratios

IDR Billion 2015 2016 2017 2018 1Q19 Ratio 2015 2016 2017 2018 1Q19

Net Income (570.32) 847.94 524.71 945.20 441.22 Growth Year on Year

Depreciation 1,399.35 1,477.40 1,506.27 1,565.93 406.97 Revenue Growth (%) 3.58% 0.13% 5.32% 8.44% 10.07%

Change in Working Capital (4,920.39) (674.65) (2,031.94) 2,509.66 (331.63) Gross Profit Growth (%) -10.53% 10.22% 12.21% 24.43% 2.97%

Change in others 7,824.95 (2,008.44) 514.69 (2,275.06) 554.88 EBITDA Growth (%) -21.11% 5.35% 3.45% 42.22% 10.31%

CFO Total 3,733.59 (357.75) 513.73 2,745.73 1,071.44 Net Income Growth (%) -148.77% 248.68% -38.12% 80.14% 54,504.69%

Capital Expenditure (3,067.53) (1,615.14) (2,816.39) (2,700.01) (456.31) Current Ratio (x) 1.75 1.78 1.74 1.77 1.78

Others (352.34) (359.98) 806.66 (930.48) (399.59) Quick Ratio (x) 1.33 1.29 1.35 1.30 1.28

CFI Total (3,419.87) (1,975.12) (2,009.73) (3,630.49) (855.90)

Asset/Liablities (x) 3.56 3.75 4.11 3.20 3.37

Dividend Paid (116.25) - - - - Liabilities/Equity (x) 1.33 1.29 1.35 1.30 1.28

Net Change in Debt 1,978.95 354.62 3,175.33 (1,057.64) (734.19)

Equity Fund Raised 64.71 1,690.52 - 446.44 - GPM (%) 36.15% 39.79% 42.39% 48.65% 44.89%

Others (1,877.42) (128.27) (2,587.63) 1,068.36 177.10 OPM (%) 15.83% 16.63% 16.50% 25.56% 23.54%

CFF Total 49.99 1,916.87 587.70 457.16 (557.09) EBITDA Margin (%) 26.70% 28.09% 27.59% 36.19% 34.73%

NPM (%) -4.43% 6.58% 3.86% 6.42% 12.13%

Net Cash Increase 363.71 (416.01) (908.30) (427.60) (341.55) ROA (%) -1.07% 1.53% 0.93% 1.68% 0.78%

Closing Balance 4,024.81 3,608.81 2,700.51 2,272.91 1,931.36 ROE (%) -2.50% 3.51% 2.18% 3.86% 1.77%

Income Statement Balance Sheet

IDR Billion 2015 2016 2017 2018 1Q19 IDR Billion 2015 2016 2017 2018 1Q19

Revenue 12,878.19 12,894.52 13,580.26 14,725.85 3,636.56 Cash and cash equivalents 4,024.81 3,608.81 2,700.51 2,272.91 1,931.36

Cost of sales 8,222.93 7,763.59 7,823.07 7,561.95 2,004.08 Financial Assets 4,298.34 5,068.32 4,620.47 4,712.73 5,063.98

Gross Profit 4,655.26 5,130.93 5,757.19 7,163.90 1,632.48 Trade Receivables 3,552.58 3,221.03 3,359.62 3,137.06 3,188.51

Other Current Assets 9,465.95 8,634.42 9,515.17 9,062.47 8,758.42

Operating Expenses 2,616.22 2,986.02 3,516.07 3,400.47 776.53 Total Current Assets 21,341.68 20,532.58 20,195.77 19,185.17 18,942.27

Operating Profit 2,039.04 2,144.91 2,241.12 3,763.43 855.95 Fixed Assets-net 9,496.46 9,925.62 12,801.85 14,211.19 14,246.66

Other Non-Current Assets 22,461.13 24,834.75 23,526.19 23,025.61 23,701.60

Interest Income 62.69 32.37 12.46 20.60 2.48 Total Non-Current Assets 31,957.59 34,760.37 36,328.04 37,236.80 37,948.26

Foreign Exhange(loss) (1,407.16) 370.47 (160.59) (899.59) 165.59 TOTAL ASSETS 53,299.27 55,292.95 56,523.81 56,421.97 56,890.53

Other income (expenses) (1,121.68) (948.92) (887.54) (1,362.16) (441.40) Trade Payables 1,832.09 1,413.07 1,482.79 1,176.47 1,108.28

Short-term Debt 4,592.96 5,305.00 3,185.40 5,610.89 5,077.51

Profit Before Tax (427.11) 1,598.83 1,205.45 1,522.28 582.62 Other current liabilities 12,706.38 12,278.92 16,023.92 10,384.48 11,074.78

Tax Expenses (143.21) (750.90) (680.75) (577.09) (141.40) Total Current Liabilities 19,131.43 18,996.99 20,692.11 17,171.84 17,260.57

Long-term Debt 10,397.45 9,440.37 10,578.86 12,027.92 11,807.32

Other Long-term liabilities 936.04 2,692.10 1,166.65 2,725.45 2,836.77

Net Income (570.32) 847.93 524.70 945.19 441.22 Total Long-term Liabilities 11,333.49 12,132.47 11,745.51 14,753.37 14,644.09

Total Equity 22,834.35 24,163.49 24,086.19 24,496.76 24,985.87

EPS (fullamount) (22.02) 5.50 3.14 1.78 1.52 TOTAL LIABILITY AND EQUITY 53,299.27 55,292.95 56,523.81 56,421.97 56,890.53

Disclaimer This research report has been issued by PT MNC Sekuritas, It may not be reproduced or further distributed or published, in whole or in part, for any purpose. PT MNC Sekuritas has based this document on information obtained from sources it believes to be reliable but which it has not independently verified; PT MNC Sekuritas makes no guarantee, representation or warranty and accepts no responsibility to liability as to its accuracy or completeness. Expression of opinion herein are those of the research department only and are subject to change without notice. This document is not and should not be construed as an offer or the solicitation of an offer to purchase or subscribe or sell any investment. PT MNC Sekuritas and its affiliates and/or their offices, director and employees may own or have positions in any investment mentioned herein or any investment related thereto and may from time to time add to or dispose of any such investment. PT MNC Sekuritas and its affiliates may act as market maker or have assumed an underwriting position in the securities of companies discusses herein (or investment related thereto) and may sell them to or buy them from customers on a principal basis and may also perform or seek to perform investment banking or underwriting services for or relating to those companies.


www.mncsekuritas.id MNC Sekuritas 1-500-899 [email protected]


MNC SEKURITAS RESEARCH TEAM Edwin J. Sebayang Head of Retail Research, Technical [email protected] (021) 2980 3111 ext. 52233

I Made Adi Saputra Head of Fixed Income Research [email protected] (021) 2980 3111 ext. 52117

Victoria Venny Telco, Consumer, Poultry, Small-Mid Cap [email protected] (021) 2980 3111 ext. 52236

Rr. Nurulita Harwaningrum Banking, Auto, Plantation [email protected] (021) 2980 3111 ext. 52237

Atikah Yusriyah Research Associate [email protected] (021) 2980 3111 ext. 52313

Ikhsan Hadi Santoso Junior Analyst of Fixed Income [email protected] (021) 2980 3111 ext. 52235

Thendra Crisnanda Head of Institutional Research, Strategy [email protected] (021) 2980 3111 ext. 52162

MNC Research Investment Ratings Guidance BUY : Share price may exceed 10% over the next 12 months

HOLD : Share price may fall within the range of +/- 10% of the next 12 months SELL : Share price may fall by more than 10% over the next 12 months

Not Rated : Stock is not within regular research coverage

PT MNC SEKURITAS MNC Financial Center Lt. 14 – 16

Jl. Kebon Sirih No. 21 - 27, Jakarta Pusat 10340 Telp : (021) 2980 3111 Fax : (021) 3983 6899 Call Center : 1500 899

MNC SEKURITAS EQUITY SALES TEAM

Andi Abidin Associate Director Institution & High Networth [email protected] (021) 2980 3111 ext. 52170

Okhy Ibrahim Manager Equity Institution [email protected] (021) 2980 3111 ext. 52180

Nesya Kharismawati Manager Equity Institution [email protected] (021) 2980 3111 ext. 52182

Harun Nurrosyid Manager Equity Institution [email protected] (021) 2980 3111 ext. 52187

Ibnu Ramadhan Institutional Equity Sales [email protected] (021) 2980 3111 ext. 52178

Wesly Andri Rajaguguk Head of Institutional Equity Sales [email protected] (021) 2980 3111 ext. 52341

Agus Eko Santoso Manager Equity Institution [email protected] (021) 2980 3111 ext. 52185

Gina Purnama Sari Institutional Equity Sales [email protected] (021) 2980 3111 ext. 52181

Muhamad Rudy Setiawan Property, Construction [email protected] (021) 2980 3111 ext. 52317

T. Herditya Wicaksana Technical Specialist [email protected] (021) 2980 3150 ext. 52150

Page 25

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