Financial Highlights

SMSM’s net sales increased by 8.8% (yoy) in 6M25 vs. 6M24, while core net profit expanded by 18.5% (yoy) during the same period. Excluding net sales of body maker segment, all other segments’ net sales have registered positive growth in 6M25 vs. 6M24 – particularly the top three segments: filter, trading and radiator. On the balance sheet side, the Company’s total assets have grown by 1.8% (ytd) while its core equity gained 5.3% (ytd). Total liabilities however, fell by 11.5% (ytd) as SMSM’s interest-bearing debts (IBD) declined by 8.1% (ytd). 

In terms of key financial metrics, ROA (TTM) and ROE (TTM) have both eked out small increases to 22% and 30%, respectively as of the end of June 2025 vs. their respective standings at the end of FY24 when they were at 21% and 29%, respectively. Likewise, profitability margins have also improved broadly, albeit slightly in 6M25 vs. 6M24.

Valuation

On the back of improving financial performance in 6M25, SMSM’s share price has also rebounded from its low of Rp1,630 per share seen last March to as high as Rp2,050 per share in August before it drifted lower to the current Rp1,880 per share. At Rp1,880 per share, SMSM is being traded at 2.0x Price-to-Sales ratio (TTM), 9.8x Price-to-Earnings ratio (TTM), and 3.0x Price-to-Book Value (MRQ). We value SMSM based on price multiples, Dividend Discount Model (DDM) and DCF which resulted in the blended target price of Rp2,325 per share. This target price implies PSR, PER, and PBV of 2.5x, 12.1x, and 3.7x, respectively based on TTM and MRQ figures, which then represents 24% upside potential from the current price. Key risks associated with our valuation include the lethargic performance of the automotive industry, weaker purchasing power, and uncertainties regarding global economy as well as geopolitics.