Hartadinata Abadi (HRTA.IJ Rp2,200; BUY TP Rp3,200): FY26F Volume Trim from Softer 2Q26 Demand; Gold Prive Recovery to Support 2H26/FY27 Outlook

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Hartadinata Abadi (HRTA IJ)

FY26F Volume Trim from Softer 2Q26 Demand; Gold Prive Recovery to Support 2H26/FY27 Outlook

2Q26 gold demand normalizes; mgmt. is now guiding 25-28 tons gold sales vol with 40-60% rev growth and 2% net margin for FY26F.
Despite 10.2/11.1% earnings cuts, we remain positive on HRTA’s long-term outlook, with FY26/27F earnings growth at 39.8/26.7% yoy.
Reiterate Buy with new TP of Rp3,200, based on 20% disc from its regional peers at 10.8x.

2Q26: Gold demand normalizes; FY26F guidance revised

According to Gold Council data, national gold demand moderated to 17 tons in 2Q26 (from 27 tons in 1Q26) as gold prices softened and the strong buying momentum seen in 1Q26 gradually eased. The softer market demand was also reflected in HRTA’s gold volume, which declined to 5.17 tons in 2Q26 (from 7.83 tons in 1Q26). Following the softer 2Q26 performance, mgmt. now targets FY26F gold sales volume of 25-28 tons, while remains cautiously positive on gold prices, supported by geopolitical uncertainty, potential monetary easing, and continued central bank demand. Accordingly, management lowered FY26F revenue growth guidance to 40-60% yoy (from 60-80% prev) with net margin target of 2%.

Bullion banks remain the growth driver

Wholesale remained HRTA’s key growth engine, contributing ~89% to total rev in 1H26, with ~80% coming from bullion banks, primarily Pegadaian and BRIS. Looking ahead, the potential onboarding of new bullion banks from conventional banks by year-end should provide an additional growth catalyst, with a more meaningful contribution from next year onwards.

Steady demand outlook to drive medium-term growth

We trimmed our FY26/27F net profit estimates by -10.2/-11.1%, mainly reflecting 5.0%/ unchanged trim on our gold sales volume assumptions. We also reduce our FY26F gold price assumption to US$4,289/oz, before improving to US$4,463/oz in FY27F. We expect overall margins to soften in FY26F amid higher contribution from lower-margin bullion bank segment and elevated gold prices, before recovering modestly in FY27F. Despite our earnings revisions, we remain positive on HRTA’s long-term growth prospects, with earnings still projected to grow strongly by 39.8/26.7% yoy in FY26/27F.

Reiterate Buy rating with lower TP of Rp3,200

We maintain our Buy rating with new TP of Rp3,200, based on 10.8x FY26F PE, applying 20% discount to regional peers’ avg multiples to reflect HRTA’s lower net margin profile. Currently, HRTA trades at attractive 7.4x FY26F PE (vs. avg peers’ 12.4x). Key risks are weaker-than-expected gold demand, delays in onboarding new bullion bank members into the ecosystem, and lower-than-expected gold price.

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