Equal
…
…
ROE = tax × interest × margin × turnover × leverage
| FY2021 | FY2022 | FY2023 | FY2024 | FY2025 | |
|---|---|---|---|---|---|
| Tax burdendriver | 0.76x | 0.74x | 0.92x | 0.98x | 2.16x |
| Interest burden | 0.99x | 0.99x | 0.98x | 0.95x | 0.92x |
| Operating margin | 23.2% | 23.1% | 24.8% | 6.5% | 3.9% |
| Asset turnover | 0.39x | 0.44x | 0.42x | 0.30x | 0.30x |
| Leverage (equity mult.) | 1.15x | 1.13x | 1.14x | 1.16x | 1.21x |
| = Return on Equity (consolidated) | 7.7% | 8.5% | 10.7% | 2.1% | 2.7% |
| Return on Invested Capital (ROIC) | 7.8% | 8.6% | 10.9% | 2.2% | 1.4% |
Consolidated (pre-minority-interest) basis; the headline ROE in the ratio grid is owners’ basis.
| FY2021 | FY2022 | FY2023 | FY2024 | FY2025 | |
|---|---|---|---|---|---|
| Current Ratio(Current Assets / Current Liabilities) | 4.97x | 5.65x | 4.77x | 3.81x | 2.07x |
| Quick Ratio((Current Assets − Inventory) / Current Liabilities) | 4.00x | 4.76x | 4.05x | 3.25x | 1.54x |
| Cash Ratio(Cash / Current Liabilities) | 3.02x | 3.62x | 3.22x | 2.56x | 1.04x |
| Working Capital(Current Assets − Current Liabilities) | $ 668 M | $ 815 M | $ 816 M | $ 741 M | $ 387 M |
| FY2021 | FY2022 | FY2023 | FY2024 | FY2025 | |
|---|---|---|---|---|---|
| Debt to Equity (DER)(Total Debt / Total Equity) | 0.00x | 0.00x | 0.00x | 0.00x | 0.00x |
| Liabilities to Equity(Total Liabilities / Total Equity) | 0.15x | 0.13x | 0.14x | 0.16x | 0.21x |
| Debt to Assets(Total Debt / Total Assets) | 0.00x | 0.00x | 0.00x | 0.00x | 0.00x |
| Net Debt(Total Debt − Cash) | -$ 504 M | -$ 628 M | -$ 690 M | -$ 667 M | -$ 373 M |
| Interest Coverage(EBIT / Interest Expense) | 80.12x | 71.44x | 43.92x | 18.58x | 12.04x |
| Equity Multiplier (Assets ÷ Equity) | 1.15x | 1.13x | 1.14x | 1.16x | 1.21x |
| FY2021 | FY2022 | FY2023 | FY2024 | FY2025 | |
|---|---|---|---|---|---|
| Gross Margin(Gross Profit / Revenue) | 26.1% | 26.6% | 28.2% | 11.4% | 11.2% |
| Operating Margin(EBIT / Revenue) | 23.2% | 23.1% | 24.8% | 6.5% | 3.9% |
| Net Margin(Net Income / Revenue) | 17.4% | 17.0% | 22.3% | 6.1% | 7.7% |
| EBITDA(EBIT + D&A) | $ 377 M | $ 436 M | $ 474 M | $ 222 M | $ 202 M |
| EBITDA Margin(EBITDA / Revenue) | 39.5% | 36.9% | 38.5% | 23.3% | 20.4% |
| Return on Assets (ROA)(Net Income / Total Assets) | 6.7% | 7.5% | 9.4% | 1.8% | 2.3% |
| Return on Equity (ROE)(Net Income (Owners) / Equity (Owners)) | 7.7% | 8.5% | 10.7% | 2.1% | 2.7% |
| Tax Burden (Net ÷ Pretax) | 0.76x | 0.74x | 0.92x | 0.98x | 2.16x |
| Interest Burden (Pretax ÷ EBIT) | 0.99x | 0.99x | 0.98x | 0.95x | 0.92x |
| Return on Invested Capital (ROIC) | 7.8% | 8.6% | 10.9% | 2.2% | 1.4% |
| Turnover | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
| Asset Turnover(Revenue / Total Assets) | 0.39x | 0.44x | 0.42x | 0.30x | 0.30x |
| Inventory Turnover(COGS / Inventory) | 4.35x | 5.56x | 5.68x | 5.67x | 4.58x |
| Receivables Turnover(Revenue / Receivables) | 9.35x | 8.34x | 12.10x | 11.26x | 13.43x |
| Payables Turnover(COGS / Payables) | 5.76x | 7.49x | 6.29x | 4.93x | 4.31x |
| Conversion Period | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
| Days Inventory Outstanding (DIO)(365 × Inventory / COGS) | 84.0 days | 65.7 days | 64.3 days | 64.4 days | 79.7 days |
| Days Sales Outstanding (DSO)(365 × Receivables / Revenue) | 39.1 days | 43.8 days | 30.2 days | 32.4 days | 27.2 days |
| Days Payable Outstanding (DPO)(365 × Payables / COGS) | 63.4 days | 48.7 days | 58.1 days | 74.0 days | 84.6 days |
| Cash Conversion Cycle (CCC)(DIO + DSO − DPO) | 59.7 days | 60.7 days | 36.4 days | 22.8 days | 22.3 days |
| FY2021 | FY2022 | FY2023 | FY2024 | FY2025 | |
|---|---|---|---|---|---|
| Free Cash Flow(Operating Cash Flow − Capex) | $ 154 M | $ 129 M | $ 135 M | -$ 125 M | -$ 251 M |
Price Rp 5,275 · market cap Rp 56 T ($ 3.1 B at the cited rate; statements are filed in USD)
| Multiple | INCO | Peer median | vs median |
|---|---|---|---|
| P/E | 40.48x | 16.25x(15/16) | +149% |
| P/B | 1.11x | 1.68x | -34% |
| P/S | 3.11x | 1.92x | +62% |
| EV/EBITDA | 13.37x | 10.31x | +30% |
| EV/EBIT | 70.35x | 14.25x | +394% |
| EV/Sales | 2.73x | 2.27x | +20% |
| FCF Yield | -8.16% | 0.01% | -77,560% |
| Dividend Yield | 1.48% | 5.27%(11/16) | -72% |
EV = mkt cap $ 3.1 B + debt $ 3.5 M − cash $ 376 M = $ 2.7 B
not computable: negative or zero base-year FCF. Shown as-is rather than estimated.
Reverse DCF: single-stage FCF, terminal growth 2.5%, discount band 9.3–13.3% (β=1; build cited in Methodology). Not a forecast.
This model projects the operating cash the whole business generates, discounts it back at the blended cost of capital, and subtracts net debt. What remains is the equity value, stated per share. Every input below comes from the company's own audited record or from cited market data, and you can adjust each one yourself.
Cyclical normalization: Commodity/cyclical name: the trailing years are a sample drawn from the price cycle, not a trend. Defaults are therefore normalized, using the full-window mean margin with no cycle-position growth extrapolation. That normalized margin is itself the embedded commodity-price assumption.
| Assumption | Value | Basis |
|---|---|---|
| Rf (risk-free) | 4.66% | US 10Y Treasury, 10 Jul 2026 |
| ERP (Rm − Rf) | 6.69% | Damodaran Indonesia, Jul 2026 (Baa2, CRP 2.46%) |
| β | 0.96 → 0.96 | Metals & Mining (unlevered) relevered at own D/E 0.00 |
| Cost of equity | 11.09% | Rf + β × ERP |
| Cost of debt | 20.00% | FY2025 interest expense ÷ total debt (clamped to a 3–20% sane band) |
| Tax rate | 16.0% | median effective rate, FY2021–FY2025 (pretax ≈ EBIT − interest) |
| WACC | 11.09% | 100% E × CoE + 0% D × Kd × (1 − t) |
| Revenue growth (yr 1, fading) | 2.5% | terminal growth from year 1, cyclical normalization: the delivered 4-yr CAGR (1.0%) reflects cycle position, not a trend |
| EBIT margin | 16.3% | full-cycle mean EBIT margin, FY2021–FY2025 (cyclical normalization: this margin is the embedded commodity-price assumption) |
| D&A / revenue | 15.7% | mean D&A/revenue, last 3 FYs |
| Capex / revenue | 35.7% | mean capex/revenue, last 3 FYs, for the explicit years; in the terminal year capex falls to replacement level (equal to depreciation, 15.7% of revenue) because holding a build-phase or pause-phase ratio in perpetuity misprices the company in whichever direction that phase points |
| ΔNWC / Δrevenue | 8.5% | median ΔNWC/Δrevenue across the seeded years (NWC = AR + inventory − AP) |
| Terminal growth | 2.5% | BI inflation-target midpoint (2.5% ± 1%) |
| Year | +1 | +2 | +3 | +4 | +5 | T∞ |
|---|---|---|---|---|---|---|
| Growth | 2.5% | 2.5% | 2.5% | 2.5% | 2.5% | 2.5% |
| Revenue | $ 1.0 B | $ 1.0 B | $ 1.1 B | $ 1.1 B | $ 1.1 B | $ 1.1 B |
| EBIT | $ 165 M | $ 170 M | $ 174 M | $ 178 M | $ 183 M | $ 187 M |
| NOPAT | $ 139 M | $ 142 M | $ 146 M | $ 150 M | $ 153 M | $ 157 M |
| + D&A | $ 159 M | $ 163 M | $ 167 M | $ 171 M | $ 176 M | $ 180 M |
| − Capex | $ 363 M | $ 372 M | $ 381 M | $ 391 M | $ 400 M | $ 180 M |
| − ΔNWC | $ 2.1 M | $ 2.2 M | $ 2.2 M | $ 2.3 M | $ 2.3 M | $ 2.4 M |
| FCFF | -$ 67 M | -$ 69 M | -$ 70 M | -$ 72 M | -$ 74 M | $ 155 M |
| PV | -$ 60 M | -$ 56 M | -$ 51 M | -$ 47 M | -$ 44 M | $ 1.1 B |
Check it yourself: revenue × margin = EBIT · NOPAT = EBIT × (1 − tax) · FCFF = NOPAT + D&A − Capex − ΔNWC · PV = FCFF ÷ (1+WACC)^yr · TV = FCFF(T∞) ÷ (WACC − g), discounted from year 5
EV = PV(explicit) -$ 258 M + PV(TV) $ 1.1 B = $ 807 M · TV 132% of EV · − net debt -$ 373 M − minority $ 0
Model output: Rp 2,021/share (-62% vs price Rp 5,275)· exit-multiple check (10.3x): Rp 3,936
Under these assumptions the model lands 62% below today's price. The market, in other words, is paying for faster growth, a fatter margin, or a lower discount rate than the inputs here assume.
| g \ WACC | 10.1% | 11.1% | 12.1% |
|---|---|---|---|
| 2.0% | 2,187 | 1,900 | 1,675 |
| 2.5% | 2,345 | 2,021 | 1,770 |
| 3.0% | 2,527 | 2,158 | 1,876 |
Model output under the stated assumptions. Every input above comes from the company's own audited record or from cited market data, and every one can be adjusted. This is not a price target and not advice.
Educational analysis. Multiples pair today’s price with the latest audited fiscal year (trailing-FY convention); peer figures are the covered peer sample, not the whole market. Never a price target.
| FY2021 | FY2022 | FY2023 | FY2024 | FY2025 | |
|---|---|---|---|---|---|
| Revenue | $ 953 M | $ 1.2 B | $ 1.2 B | $ 950 M | $ 990 M |
| Cost of Goods Sold | $ 704 M | $ 866 M | $ 885 M | $ 842 M | $ 879 M |
| Gross Profit | $ 249 M | $ 314 M | $ 347 M | $ 108 M | $ 111 M |
| Operating Income (EBIT) | $ 221 M | $ 273 M | $ 305 M | $ 62 M | $ 38 M |
| Interest Expense | $ 2.8 M | $ 3.8 M | $ 6.9 M | $ 3.3 M | $ 3.2 M |
| Net Income | $ 166 M | $ 200 M | $ 274 M | $ 58 M | $ 76 M |
| Net Income Attributable to Owners | $ 166 M | $ 200 M | $ 274 M | $ 58 M | $ 76 M |
| Depreciation & Amortization | $ 156 M | $ 163 M | $ 169 M | $ 159 M | $ 164 M |
| FY2021 | FY2022 | FY2023 | FY2024 | FY2025 | |
|---|---|---|---|---|---|
| Cash & Equivalents | $ 508 M | $ 634 M | $ 699 M | $ 675 M | $ 376 M |
| Accounts Receivable | $ 102 M | $ 141 M | $ 102 M | $ 84 M | $ 74 M |
| Inventory | $ 162 M | $ 156 M | $ 156 M | $ 149 M | $ 192 M |
| Current Assets | $ 837 M | $ 990 M | $ 1.0 B | $ 1.0 B | $ 749 M |
| Total Assets | $ 2.5 B | $ 2.7 B | $ 2.9 B | $ 3.2 B | $ 3.3 B |
| Accounts Payable | $ 122 M | $ 116 M | $ 141 M | $ 171 M | $ 204 M |
| Current Liabilities | $ 168 M | $ 175 M | $ 217 M | $ 263 M | $ 362 M |
| Total Liabilities | $ 318 M | $ 303 M | $ 361 M | $ 444 M | $ 571 M |
| Total Interest-Bearing Debt | $ 4.8 M | $ 5.7 M | $ 8.6 M | $ 8.0 M | $ 3.5 M |
| Total Equity | $ 2.2 B | $ 2.4 B | $ 2.6 B | $ 2.7 B | $ 2.8 B |
| Equity Attributable to Owners | $ 2.2 B | $ 2.4 B | $ 2.6 B | $ 2.7 B | $ 2.8 B |
| FY2021 | FY2022 | FY2023 | FY2024 | FY2025 | |
|---|---|---|---|---|---|
| Operating Cash Flow | $ 335 M | $ 348 M | $ 421 M | $ 207 M | $ 235 M |
| Capital Expenditure | $ 181 M | $ 219 M | $ 286 M | $ 332 M | $ 486 M |
INCO gross margin: 26.1 % (2021) → 26.6 % (2022) → 28.2 % (2023) → 11.4 % (2024) → 11.2 % (2025). OPM: 23.2 % → 23.1 % → 24.8 % → 6.5 % → 3.9 %. Net margin: 17.4 % → 17.0 % → 22.3 % → 6.1 % → 7.7 %. ROE: 7.7 % → 8.5 % → 10.7 % → 2.1 % → 2.7 %. ROIC: 7.8 % → 8.6 % → 10.9 % → 2.2 % → 1.4 %. EBITDA margin: 39.5 % → 36.9 % → 38.5 % → 23.3 % → 20.4 %. D/E: ~0.002 throughout; effectively debt-free, with net cash of −USD 0.37 B to −0.69 B every year. Current ratio: 5.0× → 5.7× → 4.8× → 3.8× → 2.1×. FCF (USD): +154 M → +129 M → +135 M → −125 M → −251 M. Revenue (USD): 0.95 B → 1.18 B → 1.23 B → 0.95 B → 0.99 B. Two facts define INCO: (1) an immaculate balance sheet; no debt, always net cash, so no financial-stress risk whatever nickel does; and (2) structurally modest returns; even the 2023 peak was only 10.7 % ROE, and the nickel crash took 2024–2025 to ~2–3 %. The heavy asset base and matte-price-taker model cap through-cycle ROE well below the coal miners’ supercycle numbers. FCF turned negative in 2024–2025 not from operating weakness but from the ramp into a multi-billion-dollar growth-capex phase: funded comfortably from cash and partners, not leverage. INCO is a quality-balance-sheet, low-return, high-capex transition asset whose earnings are a near-pure play on the LME nickel price.
INCO owns its Sorowako laterite reserves and, critically, generates most of its own smelting power from captive hydro (Larona/Balambano/Karebbe dams), insulating it from fuel-price swings. Mining and processing inputs are competitively sourced. The growth JVs bring partner-supplied technology (Huayou HPAL) but on negotiated terms.
Implication → Captive hydro is a durable cost advantage: it keeps Sorowako low on the nickel cash-cost curve and is why INCO stayed profitable through the 2024–2025 price crash where higher-cost NPI/HPAL bled.
Matte is LME-benchmarked and sold almost entirely to two related parties (Vale Canada, Sumitomo): concentrated offtake with no seller pricing power. The related-party structure guarantees volume but also means transfer pricing follows LME formulas rather than negotiated premiums. Battery-grade output (future) will sell into a Chinese/Korean-buyer-heavy market.
Implication → Earnings are a near-pure LME-nickel play with guaranteed offtake: low commercial risk, but no pricing upside beyond the benchmark and volume.
Sorowako’s integrated mine-plus-hydro-plus-smelter complex took decades and billions to build and cannot be quickly replicated. New nickel capacity is entering elsewhere (Chinese-backed HPAL/RKEF at IMIP/IWIP), that is the oversupply that crashed prices, but replicating INCO’s specific captive-hydro, low-carbon position is hard. IUPK, RKAB and AMDAL gate any entrant.
Implication → INCO’s asset is protected, but the broader nickel market is not: new low-cost Chinese-backed supply sets the price INCO receives. Its edge is cost/carbon quality, not scarcity of supply.
Class-1 nickel demand for batteries faces LFP-chemistry substitution (LFP uses no nickel and has gained share versus NMC), softening the long-run nickel-demand slope. Stainless steel (the traditional nickel sink) has no substitute at scale. The battery-grade pivot (HPAL/MHP) is INCO’s attempt to ride the surviving NMC/high-nickel demand while stainless underpins the base.
Implication → Nickel carries a chemistry-substitution risk that copper/gold do not: the reason INCO’s downstream bet is on high-nickel battery chemistries and low-carbon credentials rather than volume alone.
INCO competes in a global nickel market flooded post-2020 by Chinese-backed Indonesian NPI/HPAL (Tsingshan/IMIP-IWIP, Harita/NCKL): the direct cause of the price crash. Domestically it sits alongside ANTM and the Chinese-JV complexes. INCO’s differentiation is low-carbon, hydro-powered, integrated production: increasingly valued if Western/Korean buyers pay for traceable, low-carbon nickel.
Implication → INCO can’t out-scale the Chinese-backed complexes; its play is the low-carbon, ESG-traceable premium plus balance-sheet durability to outlast the oversupply cycle.
Curated narrative (educational interpretation), backed by the linked sources. The figures above are deterministic. Not investment advice.
Indonesia controls >60 % of global nickel supply and is the world's largest thermal-coal exporter; hilirisasi mandates in-country ore processing, reshaping value chains from raw ore to battery-grade products.