INDF booked revenue growth of 3.66% YoY to IDR115.78 trillion in FY24. The growth was driven by an increase in branded consumer products (CBP) segment sales by 6.88% YoY to IDR73.32 trillion in FY24. On a quarterly basis, CBP segment sales decreased 5.52% QoQ to IDR17.75 trillion in 4Q24 due to purchasing power pressure. We estimate CBP segment sales to potentially recover in 1Q25, driven by increased demand during Ramadan and Eid al-Fitr period.

INDF booked operating profit by segment growth of 16% YoY in FY24. The growth was driven by Agribusiness segment operating profit, which increased significantly by 88.28% QoQ to IDR1.78 trillion in 4Q24 so that cumulatively, Agribusiness segment operating profit increased by 73% YoY to IDR3.66 trillion in FY24. This increase was in line with the high CPO price in 4Q24, which caused the Agribusiness segment’s sales to increase.

INDF’s net profit increased by 13.78% YoY to IDR13.07 trillion in FY24. The increase in net profit was in line with solid operating performance driven by an increase in operating profit of all INDF’s business segments on a quarterly and cumulative basis.

We estimate INDF’s net profit to potentially increase by 5.57% YoY to IDR13.8 trillion in FY25F. This estimate aligns with the potential for stable operational performance so that profitability can be maintained. In the future, fluctuations in the rupiah exchange rate need to be considered as they could potentially affect INDF’s profitability.

Using the Discounted Cash Flow method with a Required Return of 7.77% and Terminal Growth of 2.95%, we estimate INDF’s fair value at IDR9,000 per share. Therefore, we maintain our Buy rating on INDF with a higher target and potential upside of 30.43%.