This is a research paper that I (Romario Justinus) and Destanti Lakstiarini regarding the valuation of stock prices RALS and LPPF. This paper is organized as a prerequisite at the Indonesia Investment Banking Competition.

1. Prasetiya Mulya School of Business and Economics
Valerian
Trisakti School Of
Management

2. Disclosures:
Ownership and material conflicts of interest:
The author(s), or a member of their household, of this report does not hold a financial interest in the
securities of this company.
The author(s), or a member of their household, of this report does not know of the existence of any
conflicts of interest that might bias the content or publication of this report.
Receipt of compensation:
Compensation of the author(s) of this report is not based on investment banking revenue.
Position as a officer or director:
The author(s), or a member of their household, does not serve as an officer, director or advisory board
member of the subject company.
Market making:
The author(s) does not act as a market maker in the subject company’s securities.
Disclaimer:
The information set forth herein has been obtained or derived from sources generally available to the
public and believed by the author(s) to be reliable, but the author(s) does not make any
representation or warranty, express or implied, as to its accuracy or completeness. The information is
not intended to be used as the basis of any investment decisions by any person or entity. This
information does not constitute investment advice, nor is it an offer or a solicitation of an offer to buy
or sell any security.

3. 1. An Executive Summary
Indonesia has shown a significant increase in the retail industry over the last few
years. The fact that retail sales have increased since 2008 at 10% CAGR to US $ 400
billion in 2014, the industry is still expecting to grow over the next two years.
With a high and positive competition comes from industry for the long term, the
expansion plan seems to be a must-do-list for retail players to gain a higher market
share. However, the implementation of an aggressive expansion to date also has the
potential to produce a low SSG, which can cause temporary cannibalization effect.
Growth of Revenue’s Modern Retailer in Indonesia
source: Aprindo
Additionally, retailers are required to put more attention on the stock. Retailers with
low inventories will result in poor efficiency, such as the bottom line would produce a
smaller margin. Although, high inventory levels also reflect the investment rate of
return of zero, as the company lost investment opportunities. Distribution and
transportation costs are also a major concern for retailers. Logistics costs in Indonesia
has become one of the highest in the whole world. Consequently, if domestic fuel
prices still low, supported by better infrastructure, lower logistics costs will be spread
retailers' margin.

4. 2. I. Company Overview–LPPF.IJ
a. Company Profile
PT Matahari Department Store Tbk (Matahari) is a retailer of apparel, accessories,
beauty products and homeaware that targets fashion conscious, value-minded
consumers. Backed by a trusted network of local and international suppliers,
Matahari’s mix of affordable fashion, quality and modern, visually appealing stores
delivers an exciting and dynamic shopping experience, making Matahari as the
department store of choice for Indonesia’s burgeoning middle class.
b. Business Profile
In 2011, Matahari Department Store merged with Meadow Indonesia, enabling
Matahari to streamline its corporate structure. However, this corporate action also
led to the company's negative equity (liabilities exceed assets) and therefore the
company cannot pay dividends yet.
c. Company’s Investment Plan
Issuers Lippo Group, PT Matahari Department Store Tbk. (LPPF) will open 77-79 new
stores by 2016 to meet the needs of the middle class whose economies continue to
be strong in the country. This particular year, the company will open 12-14 new
stores. Lippo Group in collaboration with Matahari Department Store launched e-
commerce MatahariMall.com. According to the Director of Lippo Group, John Riady,
this project has been planned since 9 months ago. MatahariMall.com claimed to be
the largest e-commerce in Indonesia like Alibaba in China. II. Company
Overview–RALS.IJ
a.Company Profile
Ramayana Being One of the most prominent department stores in Indonesia,
positioned to cater to the lower- to lower middle market, Ramayana has grown and

5. prospered with the increased disposable income of average Indonesians, numbering
in the tens of million families. First established as a modest effort in 1978, today
Ramayana stands as a market leader in its retail segment. With the good growth of
the store, new lines of products were added to compliment the original focus of the
business, which was garment and clothing.
.b. Business Profile
OWNERSHIP STRUCTURE
PT Ramayana Makmursentosa : 55.88%
Paulus Tumewu : 3.66%
Free float : 40.46%
c. Company’s Investment Plan
PT Ramayana Lestari Sentosa Tbk (RALS) took the Dutch retail company Spar
supermarket Spar International to build 15 this year. Finance Director Ramayana
Lestari Sentosa, Suryanto said, in improving the services business, particularly retail
business daily necessities and food products, the company has been working
exclusively with Spar International, Amsterdam-based retail network with 12,000
stores worldwide. Ramayana rename Robinson became Spar supermarket.
3.Macroeconomic and Industry Overview
a.Macroeconomic Overview
Indonesian macroeconomic conditions showed significant progress in January 2015.
The increased seasonal demand for consumer goods from various countries of export
destinations in December amid the trend of the weakening rupiah, the catalyst for
the trade balance recorded a surplus of USD186.80 million, slightly above forecasts
consensus amounted to USD173 million, and has also increased from a deficit of
USD425.40 million in November

6. Historical Inflation in Indonesia in 2014
source: bps.go.id
Inflation is expected to reach an average of 4.2% in the second half of 2015 and will
likely reach an average of 5.8% for the full year due to the increase in electricity
tariffs and the pressure rises in food prices due to drought at the end of 2014.
Inflation is projected to rise for a while until it reaches an average of 6.9% in 2015,
assuming the government raised fuel prices 30% -50%.
Rupiah exchange rate in the range of IDR12,388 - IDR12,735 per USD before finally
closed at IDR12,672 per USD. Rupiah depreciated by 1.91% compared to the end of
December 2014 at a level IDR12,434 per USD.
3.b.Industry Overview
i. Industry Growth
The growth of retail business in 2014 will be particularly many challenges. Because,
first, retail businesses have to face a number of challenges such as the weakening of
the rupiah against the dollar will increase the selling price of goods and ultimately
can reduce people's purchasing power.

7. The second challenge is the tightening of licensing the opening of new stores which
refers to a circular letter of the Minister of Trade No. 1310 / M-DAG / SD / 12/2014
issued on December 22, 2014 which asked the governors, regents and mayors in
order to temporarily not issue business licenses Stores Modern before the regulation
of the Spatial Plan (RTRW) and the Detailed Spatial Plan (RDTR), including zoning
regulations enacted or issued. ii. Market Share Between Competitors
Market Share of Retail
source :AC Nielsen

8. Market Share Of Retail
Source : Aprindo
Until now Matahari Department Store still controls a market share of 32.8%, followed
by the Ramayana by 22.4%. While MAPI, YOGA, and CENTRO each hold not more
than 10% market share.
iii. Porter’s 5 Forces
1.LPPF.IJ
1.THREAT OF NEW ENTRANTS
The threat of new entrants candidates essentially "moderate" because of the existing
market Now this has been so dominated by big players both local and foreign. To be
able to get into this industry at least needed capital, experience, and extensive
distribution network which is quite difficult for potential new entrants.
Analysis of the threat of new entrants candidates:
a. Economies of scale in the retail industry is quite high and prospective new entrants
should be able to get an adequate financial return in order to continue to make new
investments.

9. b. The need for capital is quite large depending on the format that will be entered.
Prospective newcomers who have capital more have the opportunity to be able to
expand the business to compete with existing players or entering new markets.
2. THREAT OF SUBSTITUTE PRODUCTS
The threat of substitute products or substitutions in the retail industry can be said is
"strong enough" because it was present long before the modern retail industry,
namely form of traditional markets and shops. Therefore, modern retailers
determine the segment itself is the upper middle class..
3. BARGAINING POWER OF SUPPLIERS
Matahari Department Store retail company that has had big names have strong
bargaining position against the manufacturers and distributors so that they can
obtain a larger margin and get discount price. Analysis power of suppliers :
a. The number of suppliers is expected to continue to grow in the future especially in
the era of free trade that have been opened so that the retailer can enter the goods
of foreign products. This leads to dependency retailers to one supplier to be low and
the increasing number of products that will be used as an alternative option.
b. Retailers can just replace the supply of one type of goods from one supplier to
another.
4. BARGAINING POWER OF BUYERS
The strength of consumers are "strong" because they usually tend to be loyal at a
particular retail and easily transform the shopping habits to their liking. Analysis
power of buyers :
a. Number of main buyers are likely to continue to increase due to the growth in the
number of women who work / career and also the number of men who come to shop
because they also can find their needs.

10. b. Purchasing power is expected to increase along with the improving economy of
Indonesia.
5. RIVALY AMONG EXISTING FIRMS
Competition among companies that occurred in the retail business format that is
between traditional and modern retail formats, or competition between local and
foreign retailers can said to be "strong." On the one hand, the low purchasing power
so that the level of consumption was low while increasing the number of outlets.
Competition in the retail industry is also characterized by the presence of a variety of
new retail formats that arise because consumers are looking for other shopping
alternatives tailored to their abilities. New retail format in question is a form of
factory outlets, specialty stores, and online retailers.
2. RALS.IJ
4.2.1 Analisis Porter 5 Forces
1.Competition In The Industry
For middle-class market segments, Ramayana Department Store to compete with
Matahari and Pasaraya. Ramayana become a leader in the retail segment of medium.
In the supermarket sector, Ramayana has Robinson is still unable to compete with
other supermarkets such as Carrefour or Hypermart belonging to the Matahari Dept
Store. PT Ramayana Lestari Sentosa Tbk has a total of 118 outlets Ramayana and
Robinson throughout Indonesia. Of total outlets, only 98 outlets that have a service
supermarket in it. On September 1, 2014, announced a partnership with the Dutch
supermarket company, SPAR International BV But that will be converted into SPAR
supermarket just 30 stores within the next three years.
2.Threats New Entries
Barriers to entry in the Indonesian retail industry is relatively small, especially for new
players who are ready to be capital and concepts. Moreover Ramayana own many

11. outlets throughout Indonesia. If a new player or an existing player in this industry
managed to build and develop a business model that is more acceptable in the
market, the market share held by the company will certainly decrease.
3.Threats Product Substitution
In the modern retail business, the threat of substitute products or substitutions can
be said to be "quite strong." The threat of substitute products is derived from the
market as well as traditional stores. Which provides a variety of basic needs required
by consumers for everyday life such as food, snacks, soft drinks, equipment / home
appliances, and others. The advantages of the traditional markets and shops are
relatively cheaper price and also the location that is closer to the residence of the
population, especially for the middle to lower. Besides the other replacement
product that began to develop at this time, namely in the form of shopping system
through telephone lines, internet, and catalog shopping.
4.Bargaining Power Of Suppliers
Almost all products sold by the company are local products company even has a
private label. On the average, Ramayana has 2000 suppliers both permanent and
seasonal. Suppliers have an important role in the promotion strategy, but the
company has a stronger position than the supplier. If one supplier out, there are
many suppliers are willing to cooperate with the company.
5.Bargaining Power Of Buyers
Generally all the products sold and in production by the company are common
products. A variety of different brands with different quality and price in the market
selling a competitive product for the company. So that consumers can choose which
products they want to buy or consume. In this case the general buyer or consumer
more has a strong position compared to the company.

12. iv. SWOT Analysis
1.LPPF.IJ
Strength :
a. Has the largest sales area and has a very good track record in the field of retail
industry
b. Has a good brand awareness
c. Has a membership program that attracts many customers
Weakness :
a. Prices tend to be more expensive than competitors' products
b. Less rapid adaptation to competitors and lack of customer loyalty.
c. Prone to theft of goods companies and consumer goods because there is no
daycare goods to customers
Opportunity :
a. Indonesia's economic growth increasing
b. Market share of retail business in Indonesia are quite large
Threats :
a. many emerging competitors with cheaper price and moving in the same plane
b. Minimum Wage and price of products from suppliers who continue to rise
2. RALS.IJ
Strengths
a. Has a high reputation by receiving numerous award, Ramayana stands as a market
leader in its retail segment.

13. b. Sell products at affordable prices with good quality and has discount programs that
attract consumers
Weakness
a. Monotonous outlets layout that makes customers do not linger in the store
b. The lack of use of the website for consumers
c. Low quality of human resources that make Ramayana unable to compete with
other department stores in terms of human resources
Opportunity
a.The weakening of the rupiah at the end of the year, giving an increase in sales,
especially in Java, because the money sent by the international labor (TKI) back to
Indonesia contributed positively to the increase in sales of Ramayana in the region.
b.The company plans to open 15 supermarkets SPAR during 2015 both within and
outside of Java
Threats
a. Decline in purchasing power due to rising fuel prices
b. Increased regional minimum wage set by the government
c. Increasing public awareness of the Internet makes e-commerce more attractive.
d. Competitive pricing and more product choice makes people interested in shopping
via the internet.
V. Business Risk
1. LPPF.IJ
Problems that occur in the PT Matahari Department Store Tbk (LPPF) has delayed
payments of dividends to investors, delays occurred in 2012 and in 2013. The
condition occurs, indicated that PT Matahari the Department Store Tbk (LPPF) have a
high level of debt ratio, it is strengthened by the expression Nasril Janson (2010),
capital market analysts from AmCapital Indonesia, which revealed that, PT Matahari

14. the Department Store Tbk (LPPF) will make payment of the debt to the Lippo Group
le CVC Capital Partners. So to increase investors' confidence back then in 2014 the
Matahari Dept Store decided to distribute a dividend amount Rp 157,6 per share.
Besides the risk of Matahari Department Store Business also refers to the variation of
EBIT, the EBIT change the company from time to time. Investors are strongly
considering this case because the business risks can be a parameter on the level of
risk.
LPPF
Year EBIT mean (EBIT - Mean)^2
2.010 692.916 1.483.470 624.974.994.473
2.011 1.241.301 1.483.470 58.645.630.826
2.012 1.584.351 1.483.470 10.177.056.866
2.013 1.814.868 1.483.470 109.824.899.523
2.014 2.083.912 1.483.470 360.531.075.718
Total 7.417.348 1.164.153.657.405
average 1.483.470 232.830.731.481
Business Risk = 0,3253
2. RALS.IJ
RALS
Year EBIT mean (EBIT - Mean)^2
2.010 365.122 378.109 168.662.169
2.011 377.582 378.109 277.729
2.012 446.417 378.109 4.665.982.864
2.013 403.012 378.109 620.159.409
2.014 298.412 378.109 6.351.611.809
Total 1.890.545 11.806.693.980
average 378.109 2.361.338.796
Business Risk = 0,1285

15. 4. I. Financial Projection
Sales variability is the prime determinant of operating earnings variability. In turn, the
variability of sales is mainly caused by a firm’s industry and is largely outside the
control of management. In this research, we use sales volatility as the basic of
increase in companies sales.
Financial Projection–LPPF.IJ
LPPF
Year Sales mean (Sales - Mean)^2
2014 7.925.547 5.662.843 5.119.828.486.534
2013 6.754.326 5.662.843 1.191.334.702.696
2012 5.616.932 5.662.843 2.107.838.285
2011 4.700.712 5.662.843 925.696.446.013
2010 3.316.699 5.662.843 5.504.392.607.194
Total 28.314.216 12.743.360.080.723
average 5.662.843 2.548.672.016.145
Sales Volatility = 0,2819
a.Statement of Financial Position
LPPF
Balance Sheet
2013 2014 2015 2016
Cash and Equivalents 772.217 785.895 980.011 1.222.074
Account & Notes Receivable 671.770 867.759 1.082.095 1.349.373
Inventories 723.809 955.231 1.191.173 1.485.393
Fixed Assets 767.073 799.487 996.960 1.243.209
Total Assets 2.936.882 3.408.372 4.250.240 5.300.049
Account Payable 1.358.879 1.559.485 1.944.678 2.425.013
Other Current Liabilities 531.302 959.036 1.195.918 1.491.310
Other Non-Current Liabilities 1.828.073 712.261 888.189 1.107.572
Total Liabilities 3.718.254 3.230.782 4.028.785 5.023.895
Total Equity (781.372) 177.590 221.455 276.154
Total Liabilities and Equity 2.936.882 3.408.372 4.250.240 5.300.049

16. b. Statement of Comprehensive Income
c. Statement of Cash Flows
II. Financial Projection –RALS.IJ
RALS
Year Sales mean (Sales - Mean)^2
2014 5.861.348 5.484.640 141.908.766.581
Statement Of Comprehensive Income
2013 2014 2015 2016
Revenue 6.754.326 7.925.547 9.883.157 12.324.297
COGS (2.391.274) (2.877.507) (3.588.251) (4.474.549)
Gross Profit 4.363.052 5.048.040 6.294.906 7.849.748
Operating Expenses (2.548.184) (2.964.128) (3.696.268) (4.609.246)
EBIT 1.814.868 2.083.912 2.598.638 3.240.502
Finance Income/Cost (291.246) (233.368) (262.307) (327.097)
EBT 1.523.622 1.850.544 2.336.331 2.913.405
Tax (373.462) (431.426) (467.266) (582.681)
Profit for the year 1.150.160 1.419.118 1.869.065 2.330.724
Other Comprehensive Income
Comprehensive Income 1.150.160 1.419.118 1.869.065 2.330.724
EPS 394 486 641 799
Statement of Cash Flows
2013 2014 2015 2016
CF from Operating Activities
Receipt from customers 13.937.039 15.927.265 14.932.152 15.429.709
Payment to suppliers (9.244.711) (10.477.757) (9.861.234) (10.632.853)
Payment to empolyees and others (2.568.884) (3.219.894) (4.750.220) (3.985.057)
Cash generated from operation 2.123.444 2.229.614 2.176.529 2.203.072
Interest received 17.928 22.583 20.256 20.256
Tax paid (470.437) (377.795) (424.116) (528.873)
Net Cash Flows from operating activities 1.670.935 1.874.402 2.093.367 2.506.253
CF from investing activities
Acquisition of fixed asset (162.307) (171.197) (166.752) (168.975)
Advanced payment for purchase fixed asset (76.965) (99.523) (88.244) (93.884)
Proceeds from sale of fixed asset 1.355 1.723 1.539 1.631
Net Cash Flow used in Investing Activities (237.917) (268.997) (253.457) (261.227)
Cash Flow from financing activities 0
Repayment of Bank Loans (1.650.000) (2.647.253) (2.148.627) (2.397.940)
Proceeds frm Bank Loan-net 250.000 1.659.200 954.600 1.306.900
Dividend Payment (460.156) (230.078) (690.234)
Payment Interest and Bank charge (274.281) (169.097) (221.689) (221.689)
Net Cash Flow used in financing activities (1.674.281) 1.617.306 (1.645.794) (2.002.963)
Net decrease in cash and and equivalents (241.263) (11.901) 194.116 242.063
Cash and cash equivalent at beginning of year 1.039.059 797.796 785.895 980.011
Cash and cash equivalent at ending of year 797.796 785.895 980.011 1.222.074
Restricted cash and equivalents (25.579)
Cash and Cash Equivalent at the end of year 772.217 785.895 980.011 1.222.074

17. 2013 6.000.818 5.484.640 266.439.521.213
2012 5.699.709 5.484.640 46.254.588.733
2011 5.086.158 5.484.640 158.788.063.717
2.010 4.775.168 5.484.640 503.350.802.573
Total 27.423.201 1.116.741.742.817
average 5.484.640 223.348.348.563
Sales Volatility = 0,0862
d. Statement of Financial Position
e. Statement of Comprehensive Income
RALS
Balance Sheet
2013 2014 2015 2016
Cash and Equivalents 869.000 625.373 747.187 908.089
Account & Notes Receivable 1.191.995 1.745.323 1.468.659 1.784.927
Inventories 872.064 808.569 840.317 1.021.274
Fixed Assets 1.445.497 1.375.402 1.410.450 1.714.183
Total Assets 4.378.556 4.554.667 4.466.612 5.428.474
Account Payable 894.785 889.070 891.928 1.084.000
Other Current Liabilities 68.582 78.474 73.528 89.362
Other Non-Current Liabilities 198.018 227.676 212.847 258.683
Total Liabilities 1.161.385 1.195.220 1.178.303 1.432.044
Total Equity 3.217.171 3.359.447 3.288.309 3.996.430
Total Liabilities and Equity 4.378.556 4.554.667 4.466.612 5.428.474
Statement Of Comprehensive Income
2013 2014 2015 2016
Revenue 6.000.818 5.861.348 7.123.560 8.657.584
COGS (3.860.568) (3.813.511) (4.634.732) (5.632.798)
Gross Profit 2.140.250 2.047.837 2.488.829 3.024.785
Operating Expenses (1.737.238) (1.749.425) (2.126.155) (2.584.012)
EBIT 403.012 298.412 362.674 440.773
Finance Income/Cost 54.686 89.712 72.199 72.199
EBT 457.698 308.124 434.873 512.972
Tax (67.163) (33.049) (86.975) (102.594)
Profit for the year 390.535 355.075 347.898 410.378
Other Comprehensive Income (2.369) 81 (1.144) (1.144)
Comprehensive Income 388.166 355.156 346.754 409.234
EPS 55,04 50,04 48,87 57,67

18. f.Statement of Cash Flows
5. Valuation
a. Discounted Cash Flow
In this study, we use the Free Cash Flow To The Firm because of the composition of
the non-current liabilities to Ramayana and Matahari Department Store unstable. For
WACC, we use the RDT of long-term debt and k using CAPM. RFR used is the average
return movement JIBOR daily basis during 2014, we did not use because it is less SBI
rate reflecting actual market conditions. Market Return (Rm) is the movement of the
JCI return on a daily basis during 2014. eta regression between daily with JCI Return
Return Return Ramayana or the daily newspaper The Matahari Department Store.
We use growth to growth based on Return On Investment Capital
LPPF
LPPF
Year EBIT Tax rate Depreciation
&
Capex Change in
Working
FCFF
Statement of Cash Flows
2013 2014 2015 2016
CF from Operating Activities
Receipt from customers 7.963.835 7.925.361 8.338.433 8.353.706
Payment to suppliers (6.470.240) (6.463.904) (6.467.072) (6.465.488)
Payment to empolyees and others (586.360) (570.223) (578.292) (574.257)
Cash generated from operation (40.279) 329 (19.975) (9.823)
Interest received 52.663 87.100 69.882 78.491
Tax paid (88.335) (56.007) (72.171) (64.089)
Net Cash Flows from operating activities 831.284 922.656 1.270.805 1.318.540
CF from investing activities
Acquisition of fixed asset (421.664) (126.809) (274.237) (200.523)
Other Cash Flows from investing (500.508) (826.594) (663.551) (745.073)
Proceeds from sale of fixed asset 3.352 1.676 838
Net Cash Flow used in Investing Activities (918.820) (953.403) (936.112) (944.757)
Cash Flow from financing activities
Repayment of Bank Loans
Proceeds frm Bank Loan-net
Dividend Payment (212.880) (212.880) (212.880) (212.880)
Payment Interest and Bank charge
Net Cash Flow used in financing activities (212.880) (212.880) (212.880) (212.880)
Net decrease in cash and and equivalents (300.416) (243.627) 121.814 160.902
Cash and cash equivalent at beginning of year 1.169.416 869.000 625.373 747.187
Cash and cash equivalent at ending of year 869.000 625.373 747.187 908.089
Restricted cash and equivalents
Cash and Cash Equivalent at the end of year 869.000 625.373 747.187 908.089

19. Amortization Capital
2010 692916 25% 109282 160689 413517 54763
2011 1241301 25% 159557 215378 -213681 1088835,75
2012 1584351 25% 180127 248497 -285015 1404908,25
2013 1814868 20% 212620 243523 238871 1182120,4
2014 2083912 20% 234983 232475 -213900 1883537,6
LPPF
Year ROIC Reinvestment
Rate
[(ROICt-ROICt-1)/ROICt-
1]
Growth
2010 0,231467443 1,104907377
2011 0,384308157 0,001822819 0,660311929 0,000700524
2012 0,405584927 -0,030732247 0,055363825 -0,012464536
2013 0,49436593 0,332251436 0,218896209 0,16425379
2014 0,48912783 0,011141905 -0,010595592 0,005449816
total 0,157939594
average growth 0,039484899
RALS
RALS
Year EBIT Tax rate Depreciation &
Amortization
Capex Change in
Working
Capital
FCFF
2010 365122 20% 250853 354026 126839 62085,6
2011 377582 20% 279822 166479 93193 322215,6
2012 446417 20% 380072 170056 232129 335020,6
2013 403012 20% 448631 421664 -36520 385896,6
2014 298412 20% 464125 126809 316183 259862,6

20. RALS
Year ROIC Reinvestment
Rate
[(ROICt-ROICt-
1)/ROICt-1]
Growth
2010 0,083792056 1,646247693
2011 0,080357048 0,859654327 -0,040994435 0,02808485
2012 0,087675325 1,12614719 0,091071994 0,189807315
2013 0,073633773 1,194579814 -0,160153973 -0,072192554
2014 0,052414282 1,855622428 -0,28817607 -0,190914953
total -0,045215343
average growth -0,011303836
WACC LPPF and Ramayana
Year Wd We rd tax rdt% k% WACC %
RALS 2014 0,063470363 0,936529637 0,083 20% 6,64 5,622794128 5,687356554
LPPF 2014 0,159635886 0,840364114 0,083 20% 6,64 5,700176139 5,850205754
Valuation of Company (in million Rupiah except valuation/share)
Valuation
2014 RALS LPPF
FCFF 259862,6 1883537,6
WACC 0,056873566 0,058502058
Growth -0,011303836 0,039484899
Firm Value 3768479,75 102954857,1
Total Liability 1195220 3230782
outstand share 7096000000 2917918080
Valuation/share 362,6352522 34176,44786

21. b. Relative Valuation
LPPF
LPPF P/E Ratio P/CF Ratio P/BV Ratio P/Sales Ratio
2014 30,86419753 23,23753516 11,67315403 5,522492164
2013 27,60373096 26,84574068 11,37222456 4,69845514
2012 10,11185606 5,544468724 4,243569031 1,38678372
2011 14,83075 6,359073139 6,503147957 1,472965408
2010 117,8309524 131,8452677 12,00251079 2,176936283
RALS
RALS P/E Ratio P/CF Ratio P/BV Ratio P/Sales Ratio
2014 15,7873701 21,57232322 1,668679399 0,95640798
2013 18,79269622 19,01998515 2,281429119 1,223124514
2012 19,64093117 24,83997987 2,735772378 1,460057866
2011 12,47622627 14,61987117 1,657899463 0,92619037
2010 15,04309657 86,17296378 1,995981311 1,120400405
6. Conclusion and Recommendation
Matahari Department Store is a giant retail company that takes the upper middle
segment with a market share of 32.8%, while the Ramayana is a retail company with
a market share of middle to lower and control of 22.4%. Results of valuation with
Free Cash Flow yield value LPPF stock is Rp 34176.44786 per share and stock value
RALS is Rp 362.6352522 per share.
The acquisition of Matahari Department Store implementation of the Ramayana
would not have a significant impact on the profitability of the Matahari due to
differences in market segmentation. It will increase the cost of the company, the
merger costs related to the change of ownership and legal entities.
Instead Merger Matahari Department Store of the Ramayana is actually beneficial
because it increases the Ramayana despite create EPS EPS Matahari Department

22. Store down. The increase in EPS Ramayana remains favorable because of Ramayana
has acquired by Matahari. Comparison LPPF stock declines than gains RALS clearly
shows that the increase in EPS RALS is greater than the decrease in LPPF. It should be
implemented merger between the Matahari Department Store on Ramayana Lestari
Sentosa.
Merger EPS EPS
Stockholders Before Merger After Merger
LPPF 486 466,3106965
RALS 50,04 93,2621393
1 Share LPPF swap 8 Share RALS

23. Attachment
http://csimarket.com/Industry/Industry_Growth.php
http://ekbis.sindonews.com/read/972173/34/ramayana-gandeng-perusahaan-belanda-
bangun-15-toko-spar-1425477908
http://market.bisnis.com/read/20150218/192/403947/aksi-lppf-matahari-dept.-store-kejar-
79-gerai-baru
http://www.infovesta.com/infovesta/news/readnews.jsp?id=ee95e544-09af-4f31-bd20-
bec75a0cd0fb
http://www.idx.co.id/id-id/beranda/anggotabursaamppartisipan/profilanggotabursa.aspx
http://www.idx.co.id/id-
id/beranda/anggotabursaamppartisipan/laporankeuangananggotabursa.aspx
http://finance.yahoo.com/quotes/RALS,JK;_ylc=X3oDMTIzaDYwOGdsBGtleXcDUkFMUyxKSw
RtaWQDbWVkaWFxdW90ZXNzZWFyY2gEc2VjA2dldHF1b3Rlc2J0bgRzbGsDbXVsdGlfcXVvdGU
-

24. http://finance.yahoo.com/q;_ylt=AgZADNoxGMY9pRsTk_ZiJ2jkNbkF;_ylu=X3oDMTI0YzhxMn
BwBHNlYwNVSCAzIERlc2t0b3AgU2VhcmNoIDExBHNsawNVSCAzIERlc2t0b3AgQXNzaXN0ZWQ
gVmVydGljYWwgU2VhcmNo;_ylc=X1MDMjE0MjQ3ODk0OARfcgMyBGZyA3VoM19maW5hb
mNlX3dlYl9ncwRmcjIDc2EtZ3AEZ3ByaWQDBG5fZ3BzAzMEb3JpZ2luA2ZpbmFuY2UueWFob28
uY29tBHBvcwMxBHBxc3RyAwRxdWVyeQNMUFBGLkpLLARzYWMDMQRzYW8DMQ--
?p=http%3A%2F%2Ffinance.yahoo.com%2Fq%3Fs%3DLPPF.JK%26ql%3D0&uhb=uhb2&fr=uh
3_finance_vert_gs&s=LPPF.JK
http://www.idx.co.id/id-id/beranda/publikasi/factbook.aspx
http://www.euromonitor.com/grocery-retailers-in-indonesia/report
http://www.euromonitor.com/retailing-in-indonesia/report
http://www.perpustakaan.depkeu.go.id/FOLDERJURNAL/indonesia%20retail%20report.pdf
bps.go.id/inflasi-2014