Astra International (ASII.IJ Rp 4,700; BUY TP Rp 5,900) 4Q24E Earnings Preview: In-line with ours, slightly above consensus

Stock Code	Last Price	Change	Change %
MFIN	4,600	920	25.00%
DCII	167,400	650	0.39%
GGRM	10,225	375	3.81%
FORU	1,690	335	24.72%
LIFE	6,600	300	4.76%
JSMR	4,590	250	5.76%
UNVR	1,725	230	15.38%
INKP	5,275	225	4.46%

Astra International (ASII IJ)

4Q24E Earnings Preview: In-line with ours, slightly above consensus

We expect ASII to meet our FY24F revenue and earnings estimation, which are currently 4% and 3% above consensus, respectively.
We expect higher-than-expected Komatsu sales, sustained Pama margin, and stable financial segment profit to drive the 4Q24F figures.
We tweak our auto margin assumption from 1.5% to 1% in 4Q24F, reducing EPS by 0.4%. Reiterate BUY with an unchanged TP of Rp5,900.

Revenue: lower auto revenue due to weak 2W, yet UNTR remains strong

We expect ASII to report in-line revenue with ours, yet 4% higher than cons for FY24F at Rp332tr (+5% yoy), with 4Q24F revenue expected at Rp85.7tr (-1% qoq/+13% yoy). This is driven by the following expectations: 1) 8% qoq lower auto revenue in 4Q24F, as 4W/2W recorded 1%/14% qoq lower sales; 2) Financial segment to remain strong (+3% qoq/+11% yoy) in 4Q24F due to spillover of strong 4W/2W sales in FY23; 3) 9% qoq growth in heavy equipment segment due to higher-than-expected Komatsu sales. Our UNTR revenue estimate is 6% higher than cons.

Auto margin is expected to decline, yet earnings are still sustained due to strong Pama margin and stable financial segment profitability

We tweak our auto margin expectation, and we expect margin to reach 1% (vs our prev. est at 1.5% in 4Q24F (-20 bps qoq/+20 bps yoy), bringing FY24F auto margin to 1.2% (vs our prev. est at 1.3%). Our forecast revision was due to weak 2W sales in 4Q24 and lower 4W higher-end models demand in 4Q24 (i.e., Innova sales declined by 13% qoq in 4Q24). Nevertheless, we expect ASII to still meet our net profit expectation of Rp33.3tr in FY24F (-2% yoy), with 4Q24F net profit at Rp7.4tr (-26% qoq/-9% yoy). Despite our lower auto margin expectation, we only lowered our EPS estimation by 0.4%. Our earnings est. is also still slightly above cons., which results from: 1) higher Pama margin sustaining, leading to a 12% qoq EBIT growth in heavy equipment segment for 4Q24F; 2) Operating profit from the financial segment is expected to stabilize at ~Rp2.2tr in 4Q24F, similar to the run rate in 1Q-3Q24.

Expecting in-line revenue and earnings, but slightly above cons

Overall, we expect ASII to meet our expectations on both revenue and earnings, which are 4%/3% above cons. We reiterate BUY rating on ASII with an unchanged TP of Rp5,900. Downside risks: 1) Disappointing IIMS 2025 final number; 2) Lower 4W/2W sales due to rising VAT and opsen implementation.

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