Bisnis.com, JAKARTA — Indonesia’s coal exports slumped in the January–July 2025 period, but analysts say several catalysts could help coal producers regain momentum toward the end of the year.

Statistics Indonesia (BPS) data show both value and volume of coal exports declined during the seven-month period. Export value reached only $13.82 billion, down 21.74% year-on-year (YoY) from $17.66 billion, while export volume contracted 6.96% to 214.71 million tons from 230.76 million tons.

According to Mirae Asset Sekuritas senior market chartist Nafan Aji Gusta, stocks linked to coal may see renewed steam during the winter as coal demand rises. Throughout the year, coal miners’ earnings have been pressured by low coal average selling prices (ASP).

“Coal demand is expected to rise in the winter. On top of that, economic recovery in India and China would provide further support,” he said on Sunday (7/9).

Nafan added that coal firms should also begin diversifying their portfolios into other businesses such as gold, nickel, and green energy. This, he said, could provide new growth drivers in the face of weakening coal prices and exports.

Coal stocks in Indonesia have been slumping this year. Shares of PT Adaro Andalan Indonesia (AADI) have fallen 14.45% year-to-date (YtD) to IDR 7,250, PT Indo Tambangraya Megah (ITMG) dropped 16.29% YtD to IDR 22,350, and PT Alamtri Resources Indonesia (ADRO) and PT United Tractors (UNTR) each down 27.57% and 5.32%, respectively.

Capital market observer Reydi Octa believes that while coal exporters remain pressured by weak demand from India and China, the coming winter could trigger a rebound.

“The winter still provides opportunities for a surge in demand that could improve performance ... If winter can push prices higher and revive demand, a rebound is quite likely,” he said.

Reydi also stressed that efforts by coal producers to tap new export markets would help offset weakness. Southeast Asian markets such as Vietnam, Brunei, and the Philippines could provide new export opportunities.

On portfolio diversification, Reydi argued that coal companies should move toward clean energy. Domestically, Indonesia’s electricity supply business plan (RUPTL) for 2025–2034 requires renewable energy to account for the largest share of the national power mix.

“We can’t ignore the global energy transition. Companies that fail to diversify into green energy, downstream operations, and sustainable businesses risk being left behind,” he said.

Despite the continued stock rout, Reydi is upbeat on the outlook of several miners with target prices of IDR 9,438 for AADI, IDR 23,479 for ITMG, IDR 27,119 for UNTR, and IDR 2,179 for ADRO.

Nafan from Mirae Asset Sekuritas also recommended adding AADI with a target price of IDR 9,225, and UNTR with a target of IDR 26,525. He further advised accumulating PT Bumi Resources (BUMI), PT Petrindo Jaya Kreasi (CUAN), PT Bukit Asam (PTBA), and ITMG. His targets include IDR 145 for BUMI, IDR 1,925 for CUAN, IDR 25,800 for ITMG, and IDR 2,590 for PTBA.

CHEAP VALUATIONS

Amid headwinds and projected rebound, several coal stocks are said to be trading at attractive valuations. Bloomberg data shows ITMG, part of the Banpu Group, is priced at a discount. Its price-to-book value (PBV) stands at 0.82 times, below the five-year average of 0.92 times. The stock also trades at a price-to-earnings ratio (PER) of 4.51 times, under its five-year average of 4.87 times.

ITMG’s earnings has weakened on both the top and bottom lines, mainly due to falling ASP, which the company’s expansion efforts fail to offset. In the first half of 2025, the company posted net revenue of $919.4 million (IDR 14.9 trillion) or down 12.4% YoY from $1.04 billion.

ITMG’s production and sales volume, however, rose during the period. Sales volume climbed 8% YoY to 11.7 million tons, while production increased 12% YoY to 10.4 million tons. The drop in revenue was attributed to a 19% decline in ASP from $97 per ton in the first half of 2024 to $78 per ton in the first half of 2025 as global coal benchmarks weakened, especially the Indonesia Coal Index (ICI).

As a result, net profit fell 29.51% year-on-year to $90.9 million (approximately IDR 1.47 trillion).

Another coal producer, PT ABM Investama (ABMM), backed by veteran investor Lo Kheng Hong, is also trading at low valuations. ABMM’s PBV is 0.58 times, below its five-year average of 0.72, while its PER stands at 6.49 times, higher than its five-year average of 4.66.

ABMM’s net profit fell sharply in the first half of 2025, dropping 69.59% year-on-year to $27.74 million (IDR 450.04 billion).