AALI posted revenue of IDR5.52 trillion in 4Q24 (-7.46% QoQ; +9.18% YoY), supported by the CPO and derivatives segment at IDR5.09 trillion (-6.66% QoQ; +7.79% YoY). Despite a 20.15% QoQ decline in the cost of revenue, rising raw material costs (+24.76% QoQ; +44.82% YoY). However, efficiency in harvesting costs (-39.46% QoQ) helped boost gross profit to IDR1.33 trillion (+84.86% QoQ; +62.58% YoY).

Net profit rose to IDR346 billion in 4Q24 (+15.43% QoQ; +35.68% YoY), driven by an improved cost structure. Cumulatively, FY24 net profit surged 43.24% YoY to IDR1.14 trillion, with net profit margin improving to 5.26% (vs. 5.09% in FY23).

The biodiesel sector continues to drive CPO demand, with a 5-year CAGR of 22.73%, supported by the B20-B35 transition. In 2023, CPO consumption for biodiesel reached 10k tons (46% of total domestic consumption). The planned B40 implementation in 2025 is expected to further boost demand.

We initiate a BUY with a TP of IDR7,000, backed by strong CPO demand. However, risks include potential B40 delays, declining FFB production, and rising raw material costs impacting margins.

By PHINTRACO SEKURITAS | Research
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