BNIS Daily Report of July 22, 2021
AALI: Seeds of Opportunity under ESG Lenses
We downgrade our rating to HOLD (from BUY) and reduce our target price for AALI to IDR8,500 (from IDR13,500) as we lower our FY21FFY22F CPO sales volume estimates.
- The slower replanting program is main driver of lower earnings estimates.
- La-Nina, pest, and maturing tree profile to still pressure AALI’s operational outlook.
- AALI’s long-term view is still positive from its good-quality seeds production and that the currently high CPO price looks sustainable in the next two years.
Analyst: Firman Hidayat (email@example.com)