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Swift Sips & Bites

Starting the day with a delicious breakfast is undoubtedly everyone's dream. Many say that breakfast is the key to kick starting the day with abundant energy.

But what if time and routine don't allow us to indulge in a luxurious or hearty breakfast every morning? 

Back in my student days, I could relish hearty breakfasts like ‘lontong sayur’ or ‘nasi uduk’, which were not only filling but also a feast for the senses. Those moments were pure joy, with plates brimming with colors and aromas that tantalized the senses.

Now, as a hard worker, reality tells a different story. Mornings feel incredibly short, and the hustle and bustle seem to consume every second. Thus, luxurious or hearty breakfasts have become a memory.

Take a peek into my desk drawer! It's now stocked with instant breakfast options that have become my morning saviors. While they might not rival the elaborate morning feasts of yore, these quick fixes at least provide the essential burst of energy needed to kickstart the day.

Hold on a second, did you notice that all my breakfast choices come from a single brand? Yes, Mayora. So, Mayora, if you're looking for someone to endorse, I'd be over the moon, haha!

No wonder all my breakfast items are from Mayora; it turns out they hold the lion's share of the market at 69% for breakfast cereal.

Source: Sucor Research

Mayora's reign over the instant breakfast market is no fluke. The year 2023 marked a milestone in success for Mayora, with promising financial reports lighting the way.

The fourth quarter saw a sharp increase in earnings, soaring to IDR 1.2 tn, a hefty 44.5% jump from the same period the previous year. This boost was largely due to a significant cut in advertisement and promotion costs by 42.4%


Source: Company, Sucor Research

Perhaps their fame has reached such heights that they've decided to dial back on promotions. It seems people are likely to reach for Mayora products off the shelves even without the lure of advertisements, a testament to the brand's stronghold in the hearts and breakfast tables of consumers.

This achievement isn't just a fleeting moment but part of an impressive upward trend in annual revenue, skyrocketing by 64.4% to reach a total of IDR 3.2 tn.

But the story doesn't end there. Mayora isn't just focusing on the domestic market but also casting its net wider into international waters with its export business. The export market has made a tangible contribution, growing by 6.4% to IDR 13.7 tn, marking significant expansion and raising its share to 43.6% of total sales.

Source: Company, Sucor Research

Mayora's prospects seem to be getting brighter by the day. It's estimated that Mayora will record a profit growth of 11% CAGR over the next five years. Net profits are expected to reach IDR 3.5 tn and IDR 3.9 tn for 2024-2025, showing yoy increases of 8.2% and 12.0%, respectively.

Source: Company, Sucor Research

How do they plan to achieve this? One key strategy is through contributions from 8-10% of new product launches in 2023 and those slated for 2024. Furthermore, a 10% capacity increase from a new wafer factory is also expected to bolster growth.

Source: Company, Sucor Research

Examining the chart below, with the current stock price (yesterday's last price: 2,370), it's evident that the stock remains undervalued when considering the substantial margin of safety between current price vs its intrinsic value. This gap not only underscores the stock's undervaluation but also signals a compelling buying opportunity.

Source: Company, Sucor Research

Considering the positive potential surrounding MYOR and its current undervalued status, we advocate a BUY recommendation with a target price of IDR 3,300.


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