September 27, 2002 11:18:39 AM
AALI Plans To Diversify Its Product

PT Astra Agro Lestari Tbk (AALI) is planning to diversified its product to soap and margarine as a way to increase sales because the addition of new area is blocked by the new policy from local government.

Whereas in fact, the addition of new area is very important regarding the productive period from the ripe plant will end in the next 4-5 years.

As reported by Bloomberg, Astra Agro is looking for a new partner in consumer goods in the next 3-5 years with the estimation of expansion cost by US$20M.

Astra Agro also report to the authority of Jakarta Stock Exchange (JSX) that the company had gained commercial loan from the bank worth Rp150B to plug the capital expenditure.

The new loan is a replacement from the bond issuance plan worth Rp500B that have been cancelled. The loan will be used to build the CPO refinery factory in East Kalimantan.

From the valuation side, we have conduct a revision for the FY02 projection and AALI’s fair value based on the decrease of DCF to Rp1,600 (from Rp2,200). However, the number still offer 28% upside.