INTP reported FY24 revenue of IDR 18.55 trillion (+3.34% YoY), broadly in line with our expectations (Phintas: 104%) and consensus (Cons: 99%). Despite softer growth in 4Q24 due to seasonal factors such as regional elections and increased rainfall, the company managed to maintain volume growth, supported by the consolidation of Semen Grobogan. Total cement sales volume reached 18.92 million tons (+8.35% YoY), underscoring INTP’s ability to sustain operational scale in a still-fragmented and oversupplied market. INTP recorded a robust net profit of IDR 2.01 trillion in FY24 (+2.96% YoY), surpassing both our and consensus estimates (Phintas: 141%; Cons: 125%). The significant quarterly jump in 4Q24 earnings (+53.25% QoQ) further reinforces INTP’s operational leverage and margin resilience, even in the face of softer seasonal demand.

INTP’s gross profit margin (GPM) expanded to 37.83% in 4Q24 (vs 34.35% in 3Q24), reflecting stronger contribution from higher-margin tier-1 cement products. This margin improvement was further supported by disciplined cost control, particularly in fuel and power costs which declined to IDR 1.36 trillion (-6.96% YoY) in 4Q24. The company’s increasing adoption of alternative fuels—reaching 21.4% usage in FY24 (vs 18.3% in FY23)—demonstrates a tangible shift toward more efficient and environmentally responsible operations.

Despite continued structural overcapacity in the cement industry (utilization rate: ~53%), we believe INTP still has moderate growth potential in FY25–26. This is underpinned by the anticipated progress of the government’s 3-million-housing development initiative, which could provide a much-needed demand tailwind. We conservatively project domestic sales volume growth of +0.60% YoY in FY25F and +1.60% YoY in FY26F, supported by a moderate recovery in pricing (blended ASP growth: +2.00% in FY25F, +1.50% in FY26F). Revenue is expected to grow at a low-single-digit pace (1.35%/2.95%), while net profit is projected to dip slightly in FY25F (–3.0% YoY) before recovering in FY26F (+4.0% YoY), backed by cost efficiencies and better fuel mix optimization.

We maintain our BUY rating on INTP with a lower TP of IDR 6,500 (from IDR 8,100), implying FY25F/FY26F EV/EBITDA forward 12-M of 5.43x/4.79x and EV/ton of USD 62.71/USD 57.08. Despite the downward revision, valuation remains attractive as INTP is currently trading at a 6-year trailing EV/EBITDA of 3.38x and EV/ton of USD 35.70 reflecting steep discounts of 71% and 74% to its 6-year historical average of 11.79x and USD 135.88. We see room for performance improvement post low season effect (4Q24–1Q25), supported by cost efficiency, higher alternative fuel usage, and expected demand from national housing and infrastructure projects, paving the way for gradual margin recovery.

By PHINTRACO SEKURITAS | Research
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