Jakarta, CNBC Indonesia – The Ministry of Energy and Mineral Resources (ESDM) through the Directorate General of Mineral and Coal (Ditjen Minerba) recently issued a policy prohibiting coal mining companies from exporting coal from January 1, 2022 to January 31, 2022..
The policy is stated in a letter with NoB-1605/MB.05/DJB.B/2021issued on December 31, 2021.
This will be a negative sentiment for coal issuers whose sales are mostly from exports. That’s because the issuer must be willing to reduce its income.
Several issuers that have the potential to be negatively affected are HRUM, ITMG, ADRO, and INDY. The contribution of coal export sales from the four, on average, reached one-third of the total revenue.
PT Harum Energy Tbk (HRUM) is estimated to be the issuer most affected by this policy. This is because exports are the backbone of the company’s income. Its contribution is very significant, reaching 94.8% of the total revenue.
In the January-September 2021 period, HRUM’s export revenue reached US$ 194.93 million. The majority of HRUM’s export sales are to East Asia such as China, South Korea, and Japan. From East Asia, HRUM managed to achieve revenue of US$ 180.8 million.
The revenue of PT Indo Tambangraya Megah Tbk (ITMG) did not escape the impact of the policy of a month-long ban on coal exports. This is because the contribution of income from exports reaches 77 percent of the total.
In the January-September 2021 period, ITMG’s revenue from exports reached US$ 1.02 billion. Southeast Asia, India and Pakistan were the biggest contributors to export revenue with US$ 408.7 million. This amount is equivalent to 39.9% of ITMG’s total exports.
Next is PT Adaro Energi Tbk (ADRO) whose majority of revenue comes from exports. Its contribution reaches 76% of total revenue.
In the January-September 2021 period, ADRO’s revenue from exports reached US$ 1.96 billion. China is the largest contributor to export revenue with US$ 607 million. This amount is equivalent to 28% of ADRO’s total exports.
Meanwhile, PT Indika Energy Tbk (INDY) felt a shock in revenue from exports through its subsidiary Kideco. Kideco itself is the third largest coal producer in Indonesia.
Currently, INDY owns 91% of Kideco’s shares since 2017. In the January-September 2021 period, Kideco contributed 64.3% to INDY’s revenue.
Of the total sales of Kideco’s coal, 66% are sold abroad, aka exports. The largest destination country is China with a contribution of 32% of Kideco’s total sales.
(ras / ras)
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