Astra International Stock Draws Interest as Analysts Highlight Undervalued Opportunity

JAKARTA, investortrust.id - Analysts spotlight the growing appeal of PT Astra International Tbk’s stock as its price slides, signaling a potentially undervalued opportunity for investors. The multi-sector giant, a heavyweight in Indonesia’s automotive industry, has faced a recent downturn in its share value, drawing attention from market watchers.

“Every price drop makes Astra International, or ASII, more enticing due to its undervaluation potential,” said Capital Market Observer Wahyu Tri Laksono in an interview with Investortrust on Thursday, Feb. 20, 2025. He framed the decline as a window for investors to accumulate shares, despite projections of further short-term softening.

The company posted solid financials through the third quarter of 2024, according to disclosures filed with the Indonesia Stock Exchange (BEI). Net profit edged up 0.63%, rising from Rp 25.69 trillion ($1.63 billion) in Q3-2023 to Rp 25.85 trillion over the first nine months of 2024. Yet, its stock price continued to test lower levels, mirroring broader pressure on the Jakarta Composite Index (IHSG).

 “The weakening of ASII isn’t surprising given the IHSG’s recent struggles, but for the long term, it remains attractive,” Wahyu noted. He pegged its trajectory toward the Fibonacci 78.6% retracement level, a technical indicator suggesting further declines before a potential rebound.

Global headwinds loomed large in the analysis. Wahyu pointed to uncertainties from a slowing Chinese economy, Trump-provoked trade wars, and tariff disputes as challenges for the firm, led by President Director Djony Bunarto Tjondro. A robust U.S. economy and Wall Street’s allure also triggered capital flight, a trend he deemed unavoidable.

Domestic monetary policies from Bank Indonesia (BI), he argued, played a secondary role to these global fundamentals in driving purchasing power declines affecting listed firms like PT Astra International Tbk (ASII).

“The current softening could persist, but it’s nearing a ‘buy on weakness’ zone for long-term investors,” Wahyu emphasized. He projected ASII’s stock could hit Rp 6,000 ($0.38) this year, with a medium-term floor around Rp 5,400.

Separately, Senior Market Analyst at Mirae Asset Sekuritas Indonesia, Muhammad Nafan Aji Gusta, acknowledged the stock’s technical downtrend. He recommended a “trading buy” with a target of Rp 4,920 ($0.31). “ASII faces weaker consumer purchasing power, but any healthcare expansion must account for rupiah-dollar volatility,” Nafan cautioned over a phone call. He flagged the sector’s reliance on imported medical equipment and drug materials as a risk to stock performance amid currency fluctuations.

Astra pursued strategic diversification to counter these pressures. In 2023, it partnered with U.S.-based Equinix to enter the data center business. Its subsidiary, PT United Tractors Tbk (UNTR), invested in renewable energy projects like geothermal, solar photovoltaic, and mini-hydro. 

In healthcare, stakes in digital platform Halodoc and hospital chain RS Hermina underscored a pivot toward growth sectors. “Astra continues to adapt creatively, focusing on technology, sustainability, and health,” Wahyu said.

Djony Bunarto Tjondro outlined these priorities late in 2024. He confirmed a shift in the heavy equipment and mining division toward non-coal minerals, exemplified by acquisitions like PT Stargate Pasific Resources and Nickel Industries Limited. “We’ll keep exploring opportunities to expand our non-coal mineral portfolio,” he said.

Infrastructure, notably toll roads, emerged as another growth engine. Since entering the sector in 2005, Astra managed eight toll road segments, mostly in Java and metro Jakarta, with plans to prioritize further investments.

Healthcare also ranked high on Djony’s agenda. “We see strong growth prospects and aim to enhance affordable healthcare access,” he explained. Investments in Halodoc, RS Hermina, and medical equipment production via PT Astra Otoparts Tbk bolstered this push. Alongside these, toll road revenues already contributed significantly, with rising traffic volumes tied to Indonesia’s economic growth offering future upside.

“We’ve rigorously reviewed these investments to ensure positive outcomes,” Djony asserted, though he withheld specifics on upcoming acquisitions. Several projects remained under evaluation, he added.