Nov 8, 2010

Gajah Tunggal aims output expansion

Indonesia's largest tire player PT Gajah Tunggal Tbk (GJTL) is planning to build 2 new tire production plants in a bid to jack up production.
In the presentation material submitted to Indonesia Stock Exchange late last week, Gajah Tunggal aims to set up one new plant for radial tire to boost production capacity from 30,000 tires per day to 45,000 tires.
A new plant for motorcycle tires are intended to lift up motorcycle tire capacity from 37,000 tires per day to 105,000 tires as well as tube tire from 74,500 tube tires per day to 162,000.
The company currently manages several main production plants. Radial facility operates 37,000 tires capacity with the utilization rate of 78% as of September 2010.
Motorcyle tire facility with the production capacity of 69,000 tires per day is now having the utilization rate of 84%.
Bias tire facility witj 13,000 tires capacity is operated at 88% rate.
Synthetic rubber and tire cored facilities are managed with the utilization rate at 73% and 83% respectively.
Gajah Tunggal reported a 21.63% increase in sales for the first 9 months of this year to Rp7.10 trillion from Rp5.84 trillion a year earlier.
Sales coming from the local tire market remained the biggest main driver for Gajah Tunggal's total sales, counting 62.79%.
Java market contributed Rp2.82 trillion, a 26.15% growth, while outside Java market made Rp1.63 trillion in sales.
The tire export market made 37.21% sales of Gajah Tinggal consolidated sales or Rp2.64 trillion with US as the largest lucrative destination market.
For the period ended September 2010, Gajah Tunggal enabled to jack up its income from operations 29.38% higher to Rp981.30 billion from the same period last year of Rp758.48 billion.
The bottom line rose 10.67% to Rp664.15 billion in 9M 2010 compared to the same period last year of Rp600.09 billion.
The company has set a net sales target of Rp9.92 trillion for this year, a 20%-25% increase from last year's level of Rp7.94 trillion.

Disclosure: No position at the stock mentioned above.  

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