AKR Corporindo (AKRA IJ) (Buy) - A proven track record of shareholder value creation

A proven track record of shareholder value creation

AKR Corporindo (AKRA) has demonstrated a strong track record of shareholder value growth, and we believe a runway for growth still exists. The group has reinvented its growth drivers from chemicals trading to fuel distribution and logistics, then to JIIPE (Java Integrated Industrial and Port Estate [unlisted]), and sees potential for future growth in liquefied natural gas (LNG). AKRA’s net profit has recorded significant growth from around IDR17.5bn in 1994, and our estimate pegs its net profit at ~IDR2.7tn in FY26F – which translates roughly into a 17% CAGR over three decades.

The earnings compounding has flowed straight into shareholder returns: on a split-adjusted basis the share price has risen from IDR18 as of end-2003 to the current level of IDR1,200, and with dividends the cumulative total shareholder return is ~119x as cash, or ~183x if dividend was reinvested – about 26% p.a. over 22 years. Dividends have compounded alongside profits, with payout now at ~80–85% and the stock yielding ~8%. We expect the next leg of growth to come from industrial estate, recurring income, and mid- to long-term growth in the LNG business, underpinning ~10% profit growth, and ~8% yield. We maintain our Buy rating.

Five decades of reinventing the growth engine

AKRA's shareholder value creation story does not center on one product but its repeated reinvention. From its 1960 roots as a Surabaya chemicals trader (incorporated as Aneka Kimia Raya in 1977; listed in 1994), the group built Indonesia's largest private basic-chemicals and fuel distribution and logistics network — storage terminals across 15-plus ports and a barge-and-truck fleet serving 2,000-plus industrial customers. It then layered on the JIIPE at Gresik, a high-margin land-and-utilities business and is now adding LNG into its growth engine.

Dividends and TSR ~183x reinvested since 2003

AKRA management has consistently returned the bulk of earnings: the payout ratio rose from ~40% in the mid-2010s to ~80% in FY25; based on our ~IDR2.7tn FY26F earnings, and assuming an ~85% payout and the dividend keeps growing, the stock would yield ~8% at ~IDR1,300/share, in our estimate.

Shareholder value has grown by 119x over the past two decades in two ways (see Fig. 1); if IDR100mn was invested at end-2003 it is worth ~IDR11.9bn as of 26 June, taking dividends as cash — a 119x cumulative TSR (~24% CAGR) — rising to ~IDR18.3bn, or 183x (~26% CAGR), if every dividend was reinvested; price appreciation alone was ~72x (~21% CAGR).

Maintain Buy; compounding shareholder returns for the future

Despite the challenges across multiple decades, AKRA has proven its execution capabilities in expanding its business – with strong moat in each segment (e.g., infrastructure & scale). We maintain our Buy rating and TP of IDR1,700 (based on 13x FY26F P/E). The stock is currently trading at a FY26F P/E of 9x. Risks to our call include: lower-than-expected trading volume, unfavorable oil supply/price dynamics, lower chemical ASP, and delayed JIIPE customer acquisition.

We analyze AKRA’s cumulative TSR since 2003 in three ways – share price only, price plus dividends, and price plus reinvested dividends. Price-only compounding ran at 21% p.a. over the period; adding dividends lifts the 22-year CAGR by 3-5pp to 24-26%. This showcases AKRA’s capability to grow.

INVESTMENT RATINGS
A rating of ‘Buy’, indicates that the analyst expects the stock to outperform the Benchmark over the next 12 months. A rating of ‘Neutral’, indicates that the analyst expects the stock to perform in line with the Benchmark over the next 12 months. A rating of ‘Reduce’, indicates that the analyst expects the stock to underperform the Benchmark over the next 12 months. A rating of ‘Suspended’, indicates that the rating, target price, and estimates have been suspended temporarily to comply with applicable regulations and/or firm policies. Securities and/or companies that are labelled as ‘Not Rated’ or ‘No Rating’ are not in regular research coverage. Benchmark is Indonesia Composite Index (‘IDX Composite’). A ‘Target Price’, if discussed, indicates the analyst’s forecast for the share price with a 12-month time horizon, reflecting in part of the analyst’s estimates for the company’s earnings, and may be impeded by general market and macroeconomic trends, and by other risks related to the company or the market in general.

GENERAL DISCLOSURE/DISCLAIMER
This report is prepared by PT Verdhana Sekuritas Indonesia (“PTVSI”) a securities company registered in Indonesia, supervised by Indonesia Financial Services Authority (OJK) and a member of the Indonesia Stock Exchange (IDX).

This report is intended for client of PTVSI only and no part of this document may be (i) copied, photocopied or duplicated in any form or by any means or (ii) redistributed without the prior written consent of PTVSI.

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This report is not to be construed as an offer or a solicitation of an offer to buy or sell any securities or financial products. PTVSI and its associates, its directors, and/or its employees may from time to time have interests in the securities mentioned in this report or it may or will engage in any securities transaction or other capital market services for the company (companies) mentioned herein.

ANALYST CERTIFICATION
The research analyst primarily responsible for the content of this report and certifies that the views about the companies including their securities expressed in this report accurately reflect his/her personal views. The analyst also certifies that no part of his/her compensation was, is, or will be, directly, or indirectly, related to specific recommendations or views expressed in this report.

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Rating Table

Rating Remains	Buy
Target price Remains	IDR 1,700
Closing price 25 June 2026	IDR 1,290

Research Analysts

Jupriadi Tan (jupriadi.tan@verdhana.id)

David Tjahjadi (david.tjahjadi@verdhana.id)

Tags: POWER AND UTILITIES, AKR Corporindo, AKRA, AKRA JK, AKRA IJ, Jupriadi Tan, David Tjahjadi, Gerald Hugo

AKR Corporindo (AKRA IJ) (Buy) - A proven track record of shareholder value creation

A proven track record of shareholder value creation

Fig. 1: AKRA TSR scenarios – proven track record of compounding earnings from multiple complementary businesses with strong moat

Fig. 2: Strong CAGR of profit and dividend – on to next growth driver in the next few years

Rating Table

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AKR Corporindo (AKRA IJ) (Buy) - A proven track record of shareholder value creation

Fig. 1: AKRA TSR scenarios – proven track record of compounding earnings from multiple complementary businesses with strong moat

Fig. 2: Strong CAGR of profit and dividend – on to next growth driver in the next few years

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