Aspirasi Hidup Indonesia (ACES IJ)

Lowering Estimates and TP on Conservative FY25 Outlook Amid Soft Consumption Trends

• Weak consumer confidence along with global and domestic uncertainties have led to mgmt conservative FY25 guidance.
• We project FY25F net profit growth of 5.3% yoy, with lower margins due to soft SSSG and higher opex.
• We believe 34% share price decline YTD has priced in the weak outlook, and thus, maintain Buy rating but with a lower TP of Rp600.

AHI sets conservative FY25 targets amidst cautious view

AHI has provided its FY25 guidance, targeting sales growth of ≥+5%, SSSG of ≥+1%, and the opening of 25–30 new stores, primarily in second- and third-tier cities. The company also aims to maintain a dividend payout ratio above 50%. AHI has set a modest SSSG target in light of global and domestic uncertainties and weak consumer confidence. However, it expects a sustainable long-term SSSG level of around mid-single digits. For 1Q25, AHI indicated still positive revenue growth, mainly driven by solid performance in the last two weeks of Mar25. It’s worth noting that in Feb25, AHI reported a -1.3% SSSG, down from +3.4% in Jan25. ACES also expects a slowdown in April sales compared to the previous year due to the shifting Ramadhan period.

Soft revenue may lead to lower margins, we project +5.3% FY25 NP growth

Following the release of the FY24 results, we have trimmed our FY25F revenue by 3.3%, reflecting expectations of softer SSSG of 1.7% (vs. 5% prev.), while maintaining our assumption of 18 new store openings. We project FY25 revenue growth of 7.5% yoy. The company aims to preserve its gross margin despite providing cautious guidance. However, we conservatively estimate a 30bps decline in gross margin due to the soft SSSG outlook. With higher operating expenses from rebranding activities—mostly incurred in 1H25—we estimate FY25 net profit to reach Rp939bn, representing +5.3% yoy increase. As a result, we lowered our FY25 net profit forecast by 1.9%.

Stock trades near -1.5SD avg 3y PE; Maintain Buy with lower TP of Rp600

By the end of Dec24, ACES’ inventory days reached 248, staying within the management target of below 250 days. Online sales contributed around 11% to AHI’s revenue, while 80% of total sales came from members, indicating a strong base of repeat and loyal customers. While continued pressure on purchasing power could weigh on retail performance, AHI’s share price has already declined 34% YTD, currently trading at a FY25F PE of 8.9x. We maintain our Buy rating with a lower TP of Rp600, based on -1SD of the 3-year average PE of 11x (vs. 15.9x previously). Downside risks are negative SSSG and lower than expected in store expansion.

… Read More 20250416 ACES