Fortune Indonesia, Tbk - PT. PEFINDO

Fortune Indonesia, Tbk
Secondary Report
Historical Chart
JCI
5,000
4,500
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
JCI FORU
Feb-12 Apr-12 Jun-12 Aug-12 Oct-12 Dec-12
Source: Bloomberg
Stock Information
Contact:
Equity & Index Valuation Division
Phone: (6221) 7278 2380
info-equityindexvaluation@pefindo.co.id
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integral part of this report”
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FORU
300
200
100
0
IDR
Ticker code FORU
Market price as of March 7, 2013 139
Market price – 52 week high 182
Market price – 52 week low 121
Market cap – 52 week high (bn) 85
Market cap – 52 week low (bn) 56
Stock Valuation Last Current
High 230 295
Low 210 270
Market Value Added & Market Risk
MVA
-82
-84
-86
-88
-90
-92
-94
-96
-98
9M11 9M12
Market Value Added Market Risk
Source: Bloomberg, Pefindo Equity & Index Valuation Division
Shareholders
0.8
0.7
0.6
0.5
0.4
0.3
0.2
0.1
0
Market Risk
(%)
PT Grhaadhika Fortune 38.82
PT Fortune Daksa Pariwara 6.32
Public (each below 5% ownership) 54.86
*Note: as of September 30, 2012
Ready to Pursue Stronger Growth
Equity Valuation
March 8, 2013
Target Price
Low High
270 295
Marketing Communication
Established in 1970, PT Fortune Indonesia Tbk (FORU) is the only
integrated marketing communication services company listed in the
Indonesia Stock Exchange (IDX). At the end of 2012, FORU sold its
majority ownership in PT Fortune Travindo (Travindo), a travel agency, to
focus on its core business. FORU is now supported by three subsidiaries:
PT Fortune Pramana Rancang (public relations), PT Pelita Alembana
(advertising) and PT Fortune Adwicipta (graphic design). Through its 41year
experience, FORU has gained the trust of major companies from
different sectors, including the Agung Podomoro Group, Astra Honda
Motor, Bank Madiri, Djarum, Campina, XL Axiata (Excelcomindo),
Breadtalk, Johnny Andrean, Indocement, Indofood, Pertamina, Optik
Melawai, Taman Impian Jaya Ancol, Sinarmas Group, Tupperware,
Mustika Ratu, Ultrajaya, Lenovo and Oriflame.
Page 1 of 9

INVESTMENT PARAMETERS
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Target Price Adjustment
Fortune Indonesia, Tbk
We have made several adjustments to our previous forecast and adjust our
Target Price upward to the range of IDR270 – IDR295 per share, based on the
following considerations:
Optimism on domestic advertising industry. In 2012, national spending on
advertising increased by 24% year-on-year (YoY) to IDR107 trillion, mainly
due to the aggressive promotion strategy of many business sectors. In line
with the 2014 national election, which will see campaigning begin in the first
half of 2013, we forecast national spending on advertising this year to
increase 16% YoY.
FORU’s financial performance. During 9M12, FORU managed to post a 9%
YoY revenue growth to IDR361 billion, thanks to soaring advertising revenue.
However, for FY2012, we’ve adjusted our revenue projection to only IDR481
billion, lower than our projection in the previous report, because of the sale
of FORU’s majority stake in travel agency PT Fortune Travindo (Travindo).
Assumption of risk free rate, equity premium and beta reach 5.4%, 7.2% and
0.4x, respectively.
Business Prospects
With Indonesia’s sound economic indicators, as seen in its strong domestic
consumption, inflation rate below 5% and low benchmark interest rate (BI rate)
of 5.75%, we believe many business sectors will seek to take advantage by
increasing production and expanding their markets. This, in turn, would further
boost the advertising industry. Accordingly, national spending on advertising this
year is predicted to climb by 16% YoY to IDR124 trillion. Further, leading up to
the national elections and World Cup in 2014, we are confident that the
advertising industry will benefit from those two big events. Given all these
opportunities along with FORU’s strong image in the domestic advertising
industry, we expect FORU to grow its revenue by a compound annual growth
rate (CAGR) of 9% during 2011–2016.
Table 1: Performance Summary
2009 2010 2011 2012P 2013P
Revenue (IDR bn) 408 489 506 481 530
Pre-tax Profit (IDR bn) 10 14 18 15 17
Net Profit (IDR bn) 7 10 13 11 12
EPS (IDR) 14.1 20.7 27.8 24.6 26.7
EPS Growth (%) (27.7) 46.6 34.3 (11.7) 8.7
P/E (x) 6.4 5.4 5.2 5.7* 5.2*
PBV (x) 0.4 0.5 0.6 0.7* 0.6*
Source: PT Fortune Indonesia Tbk., Pefindo Equity & Index Valuation Division Estimates
Notes: * Based on Share Price as of March 7, 2013 – IDR139/share
March 8, 2013 Page 2 of 9

GROWTH VALUE MAP
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Fortune Indonesia, Tbk
The Growth-Value Map below provides an overview of the market expectations
for the companies listed on the IDX. The Current Performance (CP) metric,
running along the horizontal axis, is a portion of current stock market value that
can be linked to the perpetuity of a company’s current performance in
profitability. The Growth Expectations (GE) metric, plotted on the vertical axis, is
the difference between the current stock market value and the value of current
performance. Both metrics are normalized by the company’s book value.
Growth-Value Map divides companies into four clusters:
Excellent Value Managers (“Q-1”)
Market expects companies in Q-1 to surpass their benchmark in
profitability and growth.
Expectation Builders (“Q-2”)
Market has relatively low expectations of profitability from companies in Q-
2 in the short term, but has growth expectations exceed the benchmark.
Traditionalists (“Q-3”)
Market has low growth expectations of companies in the Q-3, although
they showed a good profitability in the short term.
Asset-loaded Value Managers (“Q-4”)
Market has low expectations in terms of profitability and growth for
companies in Q-4.
Figure 1: Growth-Value Map of FORU (Advertising, Printing
& Media Industry)
Growth Expectations
6
5
4
3
2
1
0
-1
-2
-3
-4
Q-2
Q-4
0 1 2 3 4 5 6
Current Performance (CP)
March 8, 2013 Page 3 of 9
FORU
EMTK
MNCN
Source: Bloomberg, Pefindo Equity & Index Valuation Division
Based on its financial report and market data, FORU is classified in the Assetloaded
Value Managers (Q-4) cluster, which means the market has low
expectations of its profitability and growth. However, by taking advantage of the
prospect available to the domestic advertising industry, we believe FORU can
gradually move to the Excellent Value Managers (Q-1) cluster. It also needs to
strengthen its internal systems and regularly update the public about its
economic success.
JTPE
SCMA
Q-1
Q-3

BUSINESS INFORMATION
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Fortune Indonesia, Tbk
Optimism on Advertising Industry in 2013
Indonesia is one of the most attractive investment destinations today due to its
young and productive population base and rising income levels. As a result,
plenty of local and international companies alike take advantage of the wealth of
opportunities presented by the country through aggressive promotions. National
advertising spending is currently dominated by companies involved in
telecommunications, fast-moving consumer goods, banking and automotive,
among others. The upcoming 2014 national elections will also bode well for the
industry, as the political climate is likely to heat up. We believe that the industry
will begin working on political campaigns, specifically for the legislature, in April
2013, with actual campaigns beginning in July 2013. Hence, national spending on
advertising is predicted to reach IDR124 trillion this year, a 16% growth over
2012.
Figure 2: Spending Advertising in Indonesia
(IDR trillion)
140
120
100
80
60
40
20
0
49
March 8, 2013 Page 4 of 9
60
86
107
124
2009 2010 2011 2012 2013P
National Advertising Spending
Source: PT Fortune Indonesia Tbk,, Pefindo Equity & Index Valuation Division Estimates
More Focus on Core Business
At the end of 2012, FORU sold its majority ownership in PT Fortune Travindo
(Travindo), a travel agency. The move was taken in order to focus more on its
core business of advertising. Without PT Fortune Travindo (Travindo), we
forecast FORU’s revenue in 2012 to reach IDR481 billion. Currently, FORU is still
supported by three subsidiaries: PT Fortune Pramana Rancang (Fortune PR, on
public relations), PT Fortune Adwicipta (Adwicipta, on graphic design) and PT
Pelita Alembana (Pelita, on advertising).
Figure 3: Some FORU’s Subsidiaries
Source: PT Fortune Indonesia Tbk,, Pefindo Equity & Index Valuation Division

FINANCE
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Fortune Indonesia, Tbk
Positive Revenue Growth, but Bottom Line Slashed
During 9M12, FORU posted a revenue growth of 9% YoY, which is modest when
compared to its 12% average annual growth from 2009–2011. Meanwhile, we
view FORU’s gross profit margin (GPM) was stable at 15.2%. Nevertheless,
higher selling expenses led to a lower operating profit of 1.1% and net profit of
0.9% from 2.5% and 2.0%, respectively, in 9M11. But with a high potential
increase in revenue in the fourth quarter, we foresee FORU’s operating and net
margins to reach 3.1% and 2.4%, respectively, by the end of 2012.
Figure 4: FORU’s Revenue and Gross, Operating, Net
Margin
(IDR billion)
600
500
400
300
200
100
0
2010 2011 9M11 9M12
March 8, 2013 Page 5 of 9
18,00%
16,00%
14,00%
12,00%
10,00%
8,00%
6,00%
4,00%
2,00%
0,00%
Revenue Gross Margin Operating Margin Net Margin
Source: PT Fortune Indonesia Tbk, Pefindo Equity & Index Valuation Division
Sound Balance Sheet
It is worthwhile to note FORU’s efforts to better manage its financial condition, as
seen in its increasing liquidity and decreasing leverage. We noted that during
9M12, FORU’s current ratio was at 2.16x, compared to 1.96x in 9M11, mainly due
to declining short-term bank debts. Accordingly, FORU’s debt-to-equity ratio
(DER) and interest-bearing debt-to-equity ratio also improved to 0.85x and
0.02x, respectively, in 9M12, compared to 1.08x and 0.07x in 9M11.
Figure 5: FORU’s Current Ratio, DER and Interest
Bearing Debt
2.50
2.00
1.50
1.00
0.50
0.00
1.63
1.63
1.74
1.29
1.96
1.08
2.16
0.85
0.02 0.06 0.07 0.02
2010 2011 9M11 9M12
Current Ratio DER Interest Bearing Dent to Equity
Source: PT Fortune Indonesia Tbk,, Pefindo Equity & Index Valuation Division

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Fortune Indonesia, Tbk
FORU Business Prospect
We are optimistic about the prospects for the national advertising industry in the
years to come, mainly due to sound economic indicators such as strong domestic
consumption, a manageable inflation rate below 5% and a low benchmark
interest rate (BI rate) of 5.75%, which would boost business activity.
Accordingly, national spending on advertising this year is predicted to grow 16%
YoY to IDR124 trillion. Leading up to the national elections and World Cup in
2014, we are confident that the advertising industry will benefit from campaign
and football promotion activities. Given all these opportunities along with FORU’s
strong image in the domestic advertising industry, we expect FORU to grow its
revenue by a compound annual growth rate (CAGR) of 9% during 2011–2016.
(IDR billion)
900
800
700
600
500
400
300
200
100
0
Figure 6: FORU’s Revenue Estimation
506
March 8, 2013 Page 6 of 9
481
530
637
703
775
2011 2012P 2013P 2014P 2015P 2016P
Revenue Estimation
Source: PT Fortune Indonesia Tbk., Pefindo Equity & Index Valuation Division Estimates

TARGET PRICE
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VALUATION
Methodology
Fortune Indonesia, Tbk
We applied the Discounted Cash Flow (DCF) method as the main valuation
approach, considering that income growth is a value driver in FORU instead of
asset growth.
We did not combine the DCF method with the Guideline Company Method
(GCM) as there are no similar companies eligible to be compared with FORU
in the IDX.
This valuation is based 100% on FORU’s share price as of March 7, 2013,
using FORU’s financial report as of September 30, 2012, for our fundamental
analysis.
Value Estimation
We use Cost of Capital of 7.9% and Cost of Equity of 7.9% based on the
following assumption:
Table 2: Assumption
Risk free rate [%]* 5.3
Risk premium [%]* 7.2
Beta [x]* 0.4
Cost of Equity [%] 7.9
Marginal tax rate [%] 25.0
Interest Bearing Debt to
Equity Ratio [x] 0.02
WACC [%] 7.9
Source: Bloomberg, Pefindo Equity & Index Valuation Division Estimates
Notes: *As of March 7, 2013
The target price for 12 months based on the valuation as of March 7, 2013
using the DCF method with a 7.9% discount rate assumption ranges between
IDR270 - IDR295 per share.
Table 3: Summary of DCF Method Valuation
Conservative Moderate Aggressive
PV of Free Cash Flows [IDR bn] 20 21 22
PV Terminal Value [IDR bn] 81 86 90
Non-Operating Assets- [IDR bn] 27 27 27
Net Debt [IDR bn] (2) (2) (2)
Total Equity Value [IDR bn] 127 132 137
Number of Share [mn shares] 465 465 465
Fair Value per Share [IDR] 270 285 295
Source: Pefindo Equity & Index Valuation Division Estimates
March 8, 2013 Page 7 of 9

Table 4: Consolidated Statements of Comprehensive
Income
(IDR bn) 2009 2010 2011 2012P 2013P
Sales 408 489 506 481 530
COGS (354) (427) (424) (400) (441)
Gross Profit 55 62 82 81 89
Operating Expense (46) (50) (64) (67) (72)
Operating Profit 9 12 18 15 17
Other Income (Charges) 1 1 0 0 (0)
Pre-tax Profit 10 14 18 15 17
Tax (3) (4) (5) (4) (4)
Net Profit 7 10 13 11 12
Source: PT Fortune Indonesia Tbk., Pefindo Equity & Index Valuation Division Estimates
Table 5: Consolidated Statements of Financial
Position
Assets
(IDR bn) 2009 2010 2011 2012P 2013P
Current Assets
Cash & cash equivalents 34 43 29 26 27
Receivables 118 165 155 132 136
Other short-term assets 59 52 62 74 83
Fixed Assets 10 9 10 10 16
Other Assets 9 8 10 13 13
Total Assets 230 276 266 254 275
Liabilities
Trade payables 113 144 118 99 109
Short-term liabilities 1 2 7 6 6
Other Short-term
liabilities
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9 14 17 12 12
Long-term liabilities - - 0.3 - -
Other Long-term
liabilities
10 12 8 12 12
Total Liabilities 133 171 150 129 139
Total Equity 97 105 116 125 135
Source: PT Fortune Indonesia Tbk., Pefindo Equity & Index Valuation Division Estimates.
Figure 7: Historical P/E and P/BV
Fortune Indonesia, Tbk
March 8, 2013 Page 8 of 9
7.00
6.00
5.00
4.00
3.00
2.00
1.00
0.00
2009 2010 2011
P/E (x) P/BV (x)
Source: PT Fortune Indonesia Tbk., Pefindo Equity & Index Valuation Division
Figure 8 : Historical ROA, ROE and TAT
(%)
10.00
9.00
8.00
7.00
6.00
5.00
4.00
3.00
2.00
1.00
0.00
2009 2010 2011
ROA (%) ROE (%) TAT (x)
Source: PT Fortune Indonesia Tbk., Pefindo Equity & Index Valuation Division
Table 6: Key Ratio
Ratio 2009 2010 2011 2012P 2013P
Growth (%)
Sales 13.1 19.8 3.3 (4.9) 10.3
Operating Profit (20.2) 37.4 44.5 (15.1) 12.7
Net Profit (27.7) 46.6 34.3 (11.7) 8.7
Profitability (%)
Gross Margin 13.4 12.7 16.2 16.9 16.8
Operating Margin
(x)
1.95
1.90
1.85
1.80
1.75
1.70
2.2 2.5 3.5 3.1 3.2
EBITDA Margin 2.3 2.6 3.7 3.6 3.7
Net Margin 1.6 2.0 2.6 2.4 2.3
ROA 2.9 3.5 4.9 4.5 4.5
ROE 6.8 9.2 11.2 9.1 9.2
Solvability (X)
Debt to Equity 1.4 1.6 1.3 1.0 1.0
Debt to Asset 0.6 0.6 0.6 0.5 0.5
Liquidity (X)
Current Ratio 1.7 1.6 1.7 1.9 1.9
Quick Ratio 1.2 1.3 1.3 1.3 1.3
Source: PT Fortune Indonesia Tbk., Pefindo Equity & Index Valuation Division Estimates

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DISCLAIMER
Fortune Indonesia, Tbk
This report was prepared based on trusted and reliable sources. Nevertheless, we do not
guarantee its completeness, accuracy and adequacy. Therefore, we are not responsible for any
investment decisions made based on this report. All assumptions, opinions and predictions were
solely our internal judgments as of the reporting date, and those judgments are subject to
change without further notice.
We are not responsible for any mistakes or negligence that occur by using this report. Recent
performance cannot always be used as a reference for future outcome. This report does not
offer a recommendation to purchase or hold particular shares. This report might not be suitable
for some investors. All opinions in this report have been presented fairly as of the issuing date
with good intentions; however, they could change at any time without further notice. The price,
value or income of each share of the Company stated in this report might be lower than
investor expectations, and investors may obtain returns lower than the invested amount.
Investment is defined as the probable income that will be received in the future; none theless
such returns may fluctuate. As for companies whose shares are denominated in a currency
other than Rupiah, foreign exchange fluctuation may reduce their share value, price or the
returns for investors. This report does not contain any information for tax considerations in
investment decision-making.
The share price target in this report is a fundamental value, not a fair market value or a
transaction price reference required by regulations.
The share price target issued by thePefindo Equity & Index Valuation Division is not a
recommendation to buy, sell or hold particular shares . It should not be considered as
investment advice from the Pefindo Equity & Index Valuation Division and its scope of service to
some parties, including listed companies, financial advisors, brokers, investment banks,
financial institutions and intermediaries, does not correlate with receiving rewards or any other
benefits from such parties.
This report is not intended for any particular investor and cannot be used as part of an
objective investment analysis of particular shares, an investment recommendation, or an
investment strategy. We strongly recommend investors to consider the suitability of the
situation and conditions before making a decision in relation with the figures in this report. If
necessary, consult with your financial advisor.
PEFINDO keeps the activities of the Equity Valuation Division separate from its Ratings Division
to preserve the independence and objectivity of its analytical processes and pr oducts. PEFINDO
has established policies and procedures to maintain the confidentiality of non -public information
received in connection with each analytical process. The entire process, methodology and the
database used in the preparation of the Reference Share Price Target Report as a whole are
different from the processes, methodologies and databases used by PEFINDO in issuing ratings.
This report was prepared and composed by the Pefindo Equity & Index Valuation Division with
the objective of enhancing the transparency of share prices of listed companies in the Indonesia
Stock Exchange (IDX). This report is also free of influence from any other party, including
pressure or force either from IDX or the listed company reviewed . Pefindo Equity & Index
Valuation Division earns a reward amounting to IDR20 million from IDX and the reviewed
company for issuing this report twice a year. For further information, please visit our website at
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This report was prepared and composed by the Pefindo Equity & Index Valuation Division. In
Indonesia, this report is published in our website and in the IDX website.
March 8, 2013 Page 9 of 9