CIMB upgrades Semen Indonesia

CIMB upgrades Semen Indonesia
14 September 2014

Analysts at CIMB has upgraded Semen Indonesia to an add rating and lifted its target price from IDR17400 (US$1.46) to IDR18300 following a substantial government-mandated increase to dividend payouts of cash-generative state-owned enterprises.

"While it remains to be seen if such high payout would continue into 2016, Semen Indonesia can afford to do so if asked, in our calculation, with marginal impact on profit-and-loss and balance sheets," CIMB writes.

It calculates that the company's fiscal 2015 dividend yield will rise to around 4.4 per cent. "The new payout, which represents some 35% higher than currently estimated, should go through unless the new government has a change of heart," CIMB says.

Published under Cement News