PT Berlina tbk - Q2 2009
Posted on Friday, October 9, 2009
Filed under
Berlina,
Keep the Value,
Value Stalking
Let's start this value stalking journey by stalking PT. Berlina tbk
Who is PT Berlina Tbk?
an Indonesian plastic manufacturer, specialized in:
BOTTLES, TOOTHBRUSH, CLOSURES / CAP, INJECTION PARTS
for some well known brands for instance:
Dettol, Dove, Citra, Betadine, Pepsodent etc
Price @ 9 Oct 09 = Rp 660 KEEP THE VALUES (see the above tabulation image for reference)
From the tabulation, you may notice that the NAV is around Rp 1330/share
What is NAV?
NAV is the value of the company.
or in other word, if the company is to close down today, it can sell itself for Rp 1330 per share (this is based on the rough calculation).
Now, you also see that the stock price @ 9 Oct 2009 is Rp 660 per share.
What does this mean?
It basically tells you that Mr Market (trader) values the company at Rp 660 per share. So, the market value is only half of company value.
I reckon this as Margin of Safety.
If you have read “playing with risk”, you will notice that we are trying to reduce the risk, to get control of the game.
How can it be done?
Now, if you think of it, you are betting Rp 660 to strike Rp 1330.
What could go wrong?
The debt level is high, 77% way higher than the healthy <30%.
But having said that, the debt are mostly long term debt.
There is no issue for short term debt, as the cash held is more than enough to pay it off.
What could be the catalyst?
Profit margin improvement will be the key factor for the company to grow.
The company must focus on work efficiency and cost cutting to improve the profit margin.
If that is so, one day, market will value this company to its real value.
End of the year diagnosis on the company:
the obvious:
Price at 30 Dec 2011: Rp. 1770.
Rough calculation:
If your initial investment was Rp 100Million, the value is now Rp 268Million.
Good enough for you?