Beruflich Dokumente
Kultur Dokumente
Syndicate 8
RM Dimas Radithya Pratomo - 29114364
Hafidz Syahrial - 29114365
Sonia Kasella - 29114396
Ridono Caesar Suhud - 29114456
EXECUTIVE SUMMARY
I. Objective
In this case, Bambang Supriyatno who is an is an investor with a
moderate risk profile want to invest a big amount on his money on the
right stock. Checking the background and the financial record of a
company are several things that he always do before deciding to invest
his money on certain stocks.
Currently Bambang has been considering on investing on Krakatau
Steels stock. What he knows is that this company is the largest steel
manufacturer in Southeast Asia. So he intends to do a background check
on the company. Bambang decides to compare it to the financial
performance of PT Gunawan Dianjaya Steel and PT Jaya Pari Steel as the
steel companies which were already settled in BEI before PT Krakatau
Steel.
II. Analysis
Bambang
wants
to
compare
PT
Krakatau
Steels
financial
Revenue
Gross Profit
Margin
Operating
Profit Margin
Net Profit
Margin
COGS to
Revenue
Operating
Expenses to
Revenue
Market
Earnings per
share
Book value per
share
Return
Return on
Assets (ROA)
11.95%
13.16%
7.01%
5.34%
6.59%
0.15%
2.11%
2.23%
2.94%
88.09%
86.84%
92.99%
6.68
%
7.15
%
84.96
%
6.60%
6.57%
6.86%
8.36
%
Rp
31.00
2,537,
166
Rp
46.00
2,719,
881
Rp
39.00
2,902,
919
Rp
38.02
589
N/A
2.82%
2.99%
3.87%
6.18%
8.45%
8.52%
11.43
%
Debt to Equity
118.79
%
181.94
%
119.69
%
Debt to Capital
54.30%
64.53%
44.25%
87.78
%
46.75
%
CAGR
Krakatau
Steel
Revenue ratio
Gross profit margin
Operating profit margin
Net profit margin
COGS to revenue
Operating expenses to revenue
Market ratio
Earning per share
Book value per share
6.15%
Rp
81.00
6.04
%
Return on
Equity (ROE)
Debt
Rp
25.98
N/A
Rp 82
3.97
%
38.02
%
24.59
%
N/A
N/A
N/A
N/A
Jaya Pa
2008
16.17
%
15.75
%
12.82
%
9.60
%
83.83
%
13.42
%
6.71
%
84.25
%
5.31
%
3.35
%
2.32
%
Rp
20.91
Rp
79
Rp
55.42
Rp
295
Rp
65.54
Rp
360
15.95
%
15.46
%
12.31
%
20.91
%
55.41
%
65.54
%
66.42
%
39.91
%
21.84
%
17.92
%
48.03
%
32.45
%
5.22%
Rp
24.59
18.19
%
2007
15.46
%
25.98
%
104.6
7%
51.14
%
Gunawan
Dianjaya
Jayapari
Steel
8%
8%
50%
-1%
8%
-6%
-6%
9%
2%
-5%
-7%
-11%
-12%
1%
5%
38%
-89%
-92%
-
-12%
11%
Return ratio
Return on assets
Return on equity
Debt ratio
Debt to equity
Debt on capital
29%
23%
-4%
-
-24%
-21%
-10%
-5%
19%
15%
total
score,
Operational
and
administration
aspect
with
Gunawan
Steel
ratio
score
11.43
Dianjaya
ratio
score
26.64
Jaya Pari
ratio
score
9.31
Return on equity
Return on
%
11.29
16
%
30.44
20
%
13.37
14
investment
%
60.51
15
12
Cash ratio
%
177.29
1%
169.03
12%
Current ratio
Collection period
Inventory turnover
total asset
%
29.1
160.92
5
%
5
19.19
3 118.87
5
5
4
2.77
79.87
99.58
5
4.5
4
Criteria
turnover
total equity/total
asset
Rating
(Classification)
0.84
52.85
3.5
1.59
4.5
1.04
8.5
55
A
0.601
8
61.5
AA
0.73
7.5
53
A
(Healt
hy)
(Healt
(Healt
hy)
hy)
In the meantime, Gunawan Dianjaya Steel has a total score 61.5 Grade
AA , that means also a healthy company. Jaya Pari Steel has a total score
Grade A, that means also healthy company but the score is lesser than
Krakatau Steel. Gunawan Dianjaya is the most welfare company.
c. DuPont Formula
DuPont formula is a common model to measure a companys
financial performance. DuPont analysis calculates the ROE where in
business world it is one of the important ratios for investors since it
gives a brief look on how profitable the company to the investors
interest.
ROE is affected by three things:
1. Operating Efficiency (represented by the Profit Margin
Ratio)
2. Asset used
efficiency
(represented
by
Total
Asset
Turnover)
3. Financial Leverage (represented by the Equity multiplier)
KRAKAT
GUNAWA
AU
STEEL
11.43%
7.15%
DIANJAYA
26.64%
10.06%
9.31%
6.53%
TURNOVER
FINANCIAL
0.84
1.59
1.04
LEVERAGE
1.89
1.66
1.37
ROE
PROFIT MARGIN
TOTAL ASSET
JAYA PARI
III.
3.1 Conclusion
By looking at the analysis result, our conclusions is:
Krakatau steels profit margin ratio (7,15%) is too small. Probably because
they had a lot of operating cost created by high debt interest or maybe
management inefficacy.
Total asset turnover at Krakatau steel is 84,49%. Its means that asset usage
efficiency to create revenue is the lowest compare to GD at 159,13% and JP
at 104,01%, the asset use is not efficient enough.
3.2 Recommendation :
Based on our fundamental analysis we recommend that Bambang should
NOT make an investment at Krakatau Steel. First of all, Krakatau Steels ROE is
far from optimum value if compared with GD. This gap is showing management
inefficiency at KS part.
Even though BUMN Financial Framework states that Krakatau steel is a
healthy company, current KS management will make their performance declining
even more in the future. KS need to find and implement more efficient management
strategy especially for managing their assets. However, assuming that they will
continue with current management and management system, its hard for them to
prevail in the future.
Second, the financial leverage for Krakatau steel at 1.89 is too high. It
indicates that this company has a lot of debt, now the question is how the company
can pay dividend to investors if they do have small ROE and a lot of debt? The
answer is they cannot. And if the investor didnt get dividend most probably they will
withdraw their investment that will cause the company to decline or even collapse.