PT Hatten Bali Tbk produces and sells grape wines in Indonesia. It offers wines under the Hatten Wines, TWO Islands, Dragonfly Wines, and Dewi Sri brands. The company was founded in 1994 and is based in Bali, Indonesia. PT HATTEN BALI Tbk operates as a subsidiary of PT Gotama Putra.

Indonesia

PT HATTEN BALI Tbk

Consumer Defensive

The company pays dividends irregularly. There have only been a few years with dividend payments in the past ten years. Dividend per share (DPS) has grown yearly, but the dynamics are somewhat mixed. In the past 12 months, the dividend yield has been low and below its peers. 

WINE.JK reported revenue of IDR 283 976mn in the last 12 months, up 12% from FY23. At the same time, the dynamics of cash flow, as measured by free cash flow (FCF), were drastically different. EPS grew 6% from FY23 to IDR 16.53.

Over the last six months, the stock performance has varied, with an increase following a drop. The stock's price trend wasn't definitive when matched against its global counterparts from the same sector and industry (as depicted above). Within the past six months, its performance has trailed this peer group's by 28ppts and its growth accelerated by 7ppts in the past month. This is equally valid for peers from the same country and industry. Given the stock's valuation versus its peers, its total price movement is neither favourable nor unfavourable.

The company has reported average EBITDA margins compared to its global peers in recent years. EBITDA margin amounted to 24.9% in the last 12 months, a decline from 27.5% in FY23. 

Historically, WINE.JK has reported strong net margins compared to its global peers. Specifically, in the last 12 months, this metric equalled 15.8%, down from 16.7% in FY23. 

PT HATTEN BALI Tbk reported a return on equity (RoE) of 15.7% in the last 12 months, down from 20.5% in FY23. 

Another important profitability metric, return on assets (RoA), amounted to 10.7% in the last 12 months, a decrease from 12.3% in FY23. 

In the last 12 months, the return on capital employed (RoCE) declined to 13.1%, above the peers. 

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been 1.8 in the past several years. This ratio implies a good shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are close to minimal. In combination with rigorous business standards, shareholder rights are well protected.

WINE.JK has very poor trading liquidity. It will take considerable time for the average private investor to sell a common position under normal market conditions. Liquidity is unstable and becomes extremely unfavourable on the days with the lowest activity. The trading volume mostly stays the same even under highly turbulent market conditions. The stock has a tiny market capitalisation, which usually makes its trading liquidity erratic and unpredictable. 

No other major risks have been identified.

The risk of default is moderate. We note resilient historical revenue growth, robust profitability, solid return on capital, and an favourable capital structure, among the positive credit factors. Among the negative credit factors, we point to weak positions in its industry, excessive margin volatility, and poor working capital management.

In highly turbulent market conditions, WINE.JK is volatile. In other words, the stock will fall much more than the index in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be large. 

In normal market circumstances, WINE.JK is exceptionally volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will change quite unpredictably. The stock's losses on its worst days (less than 1-5% of the time) will range from large to immense. 

Based on key historical and expected multiples, the stock is fairly valued relative to its peers. Specifically, the stock is fairly valued on P/E, neutral on EV/EBITD. 

PT HATTEN BALI Tbk

IDR 252

3

PT HATTEN BALI Tbk

IDR 252

3

Risk factor

Profitability factor

Risk / Profitability

Risk factor

Profitability factor

IDR 252

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