HMSP - Profit reaches IDR6.6tn in FY25

HMSP - Profit reaches IDR6.6tn in FY25 PT HM Sampoerna Tbk (HMSP) recorded a net profit of IDR6.6 tn in FY25, a slight decrease of 0.60 percent from the same period of last year.. Following those results, the basic earnings per share of the Dji Sam Soe cigarette producer were at IDR57. Meanwhile, net sales were IDR112.17 tn, slightly corrected by 4.84 % from the same position the previous year, which was IDR117.88 tn. The cost of goods sold was IDR91.55 tn, a slight decrease from IDR99.34 tn. The company's gross profit amounted to IDR20.61 tn, an increase from the previous year's IDR18.53 tn. Selling expenses were IDR7.96 tn, up from IDR7.89 tn. General and administrative expenses amounted to IDR3.36 tn, up from IDR2.94 tn. Meanwhile, financial income was IDR346.71 bn, down from IDR720.73 bn. Then, financial expenses were IDR38.65 bn, down from IDR39.56 bn. (Source: CNBC Indonesia) Comment: The decline in sales is anticipated on the continuing down trend sector. Yet in all we like HMSP’s ability to grow gross profit in a shrinking market shows powerful pricing power and cost management. For investors, the stable EPS of IDR 57 and a strengthened balance sheet suggest that HMSP remains a reliable dividend payer, even in a challenging regulatory environment. For a "Yield Hunter," HMSP remains a top-tier pick in 2026. While the cigarette industry faces long-term structural volume declines, HMSP’s transition into Hand-Rolled Kretek (SKT) and IQOS is a "high-margin" play that supports this dividend-heavy business model. The zero-percent excise hike for 2026 is the final piece of the puzzle, as it prevents "margin squeeze". Maintain BUY HMSP, DCF valuation of IDR 10,010 (13.2x ‘26F P/E).