KLBF - Sustaining growth further, after solid 1H25 results
KBVS Update
Thursday, 28 August 2025
KLBF - Sustaining growth further, after solid 1H25 results
(Maintain BUY, with TP of IDR1,740)
Kalbe Farma’ (KLBF) has anticipated Indonesia’ current economic conditions with weaker purchasing power and adjusted its ‘25F revenue’ and earnings’ growth guidance to around 6-8% yoy. Yet, we still maintain our ‘25F revenue' (+10.4% yoy) and earnings' (+10.7% yoy) growth with a 10bps net margin expansion for KLBF on higher ASP with better sales, products mix and costs management, amidst unpredictable weather.
KLBF' earnings reached IDR898 bn (+7.3% yoy/-16.6% qoq) in 2Q25, despite softer qoq sales and continued high A&P expenses. Thus, KLBF’ 1H25 earnings still reached IDR1.98 tn (+9.4% yoy), on better product mix and cost management with higher interest and other operating income, which came above ours’ (55.1%) and cons’ (55.6%) expectation.
KLBF’ revenue reached IDR8.23 tn (+3.4% yoy/-6.9% qoq) in 2Q25 on higher products ASP and improved sales volume from new product launches, despite softer qoq sales post Lebaran festivities amidst weaker consumer purchasing power. As a result, KLBF’ revenue reached IDR17.08 tn (+4.6% yoy) in 1H25, which came in-line with ours’ (47.4%) and cons’ (48.8%) expectation.
All in all, KLBF' gross, EBIT and net margin expanded to 41.1% (+150bps yoy), 14.3% (+30bps yoy), and 11.6% (+50bps yoy), respectively in 1H25 on better product mix and cost management with higher interest and other operating income, yoy, despite soft sales growth and high A&P expense. Moreover, KLBF would surely continue its efforts to convert the payments to its suppliers from USD to RMB as to ease costs pressure.
Maintain BUY on KLBF with TP of IDR 1,740/share (+34.9% upside from yesterday closing price) at 22.7x '25F P/E, as we still expect KLBF to perform well in 2H25F amidst unpredictable weather and a potential recovery in Indonesia’ economic condition. Currently, KLBF is trading at 16.9x ‘25F P/E or at -1.5stdev of its 5 years’ mean P/E.
Regards,
Andre Suntono – KBVS Research Team