ASII income decreased by 9.4% in 1Q20, driven by the increase selling expenses and foreign exchange loss each by (18.3% YoY, 243.0% YoY). Nationally, car sales are still sluggish as the effect of large-scale social restrictions (PSBB) caused some of ASII’s factories to stop productions, which dampens the car sales in the second quarter of 2020. However, during the pandemic, ASII managed to close the divestment of its subsidiary BNLI valued at IDR16.83 tn to strengthen its cash position. We estimate an FY20 income of approximately IDR211.6 trillion with ratio of P/E Forward on level 15.3x and based on that we recommend Hold with target price of IDR5,350.
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