Markets Mining & Energy

BUY: ADRO

  • The industry has reached the bottom.
  • ADRO has a lot of cash.
  • ADRO paid for large dividend.

After rising rapidly from 700 IDR to 1.200 within 2 months, Adaro Energy tbk (ADRO)’s share movement became stagnant. In fact, ADRO Fundamental is among the best, with cash pilling up waiting for a project that increases share value. Moreover, now the coal industry has reached a new balance so the companies are easier to calculate and plan long-term strategies.

Other than that, ADRO has a lot of cash, reaching US$ 709,4 million at the end of June 2016, which means that the cash will support the upcoming plan like buying 75% of IndoMet Coal’s share from BHP Billiton. ADRO is also planning to fund 2×1.000MW power plant project at Batang, and also many other power plant projects.

And as for good news, ADRO paid for large dividend this year. ADRO’s dividend is US$ 40,3 million or 49,52% from net profit.

About the author

Rowena Suryobroto


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